Raising the age of Medicare eligibility. “Medicare provides health insurance to almost everyone who is 65 or older. If the eligibility age was raised above 65, fewer people would be eligible for Medicare, and outlays for the program would decline relative to those projected under current law. CBO expects that most people affected by the change would obtain health insurance from other sources, primarily employers or other government programs, although some would have no health insurance.” – Congressional Budget Office

Providers brace for Medicare pre-payment audits. “CMS last month published national plans to increase the number of reviews to 2.7 million claims a year, up from 1.2 million claims, according to American Medical News. Some providers voiced concerns about the audits, including the American Medical Association…” – FierceHealthCare

Update about the Texas Medicaid waiver. “The waiver allows Texas to keep drawing down billions of federal dollars even as the state expands Medicaid managed care programs designed to curb costs and make care more efficient for Texas’ neediest patients.” – Texas Tribune

Texas Democrats filed brief in support of health care reform law. “Opponents of the federal law, like Republican Texas Attorney General Greg Abbott, have argued that the key tenet of the reform — forcing people to carry health insurance — is an unconstitutional overreach.” – Texas Tribune

“Doctors have to make the difficult decision whether to continue to treat these patients even though it doesn’t make any financial sense,” said Steve Levine, a spokesman for the Texas Medical Association.

Sen. Wendy Davis, D-Fort Worth, has asked Texas Health and Human Services Commissioner Tom Suehs to re-evaluate the impact of these cuts and restore coverage for cancer patients.

“These cuts are about to put at risk the lives of some of our most vulnerable Texans,” Davis said in a prepared statement. “These are poor, elderly patients who have no health care options other than Medicare and Medicaid, and if the state fails to help maximize those funds, then these dual-eligible patients may be denied treatment that would save their lives.”

But the savings will come at the expense of some of the state’s most vulnerable citizens, Bruce Malone, president of the Texas Medical Association, told the Texas Health and Human Service Commission at a public hearing in November.

He said it’s already difficult to find physicians willing to accept new Medicare patients.

A Texas Medical Association survey conducted earlier this year found that 25 percent of physicians limit the number of new Medicare patients, and 8 percent will accept no new Medicare patients. The percentages are even higher for primary-care physicians.

The problem will get worse as the health care reform law takes effect and millions more people are added to the Medicaid rolls. As the article notes, the lower-income population in Texas is growing, and the state already has one of the lowest Medicaid reimbursement rates. Where will the money come from to pay for the coverage?

CLASS CSAs, CLASS DSAs, and CDSAs:

Effective January 1, 2012, a CMA and DSA can bill for pre-enrollment assessment activities on the same day. (Letter)

ICF/MRs:

DADS issued this letter to guide providers on using video surveillance cameras to monitor common areas. An excerpt:

There is no state rule or federal requirement that specifically addresses the use of video surveillance cameras in ICFs/ID; however, 42 Code of Federal Regulations (CFR) §483.420(a) (W122), §483.420(a)(5) (W127), §483.420(a)(7) (W129 and W130) and §483.420(a)(9) (W133) require an ICF/ID to protect the privacy and rights of the individuals who reside in the facility. When an ICF/ID chooses to use video surveillance cameras to monitor common areas, it must:

1. Obtain approval before implementation from the facility’s specially constituted committee (SCC). 42 CFR §483.440(f)(3) (W262) requires the facility’s SCC (sometimes referred to by CMS as the Human Rights Committee or the Constituted Advisory Committee) to review and approve programs and practices that might involve risks to individual rights before implementation. This is intended to ensure individual’s rights are fully protected. Therefore, the facility’s video surveillance camera policies and procedures must be reviewed and approved by its SCC before cameras may be installed.

• Cost reporting information for CBA HCSS, CLASS CMA/DSA, and PHC

• Cost reporting information for HCS, ICF/MR, and TxHmL

• Cost reporting information for Adult Day Care, ALRC, CBACCAD, DBMD, NF, and RC

DAHS:

DADS clarified procedures for documenting information on Form 3682, DAHS Daily Transportation Record, and the activities DAHS facility may bill as part of transportation services. (Letter)

CDS for PHC, CAS, and FC:

DADS is adjusting the calculation of the Annual Service Plan for PHC, CAS and FC to be consistent with calculations made by the Service Authorization System. (Letter)

All Community Services 1915(c) Waiver providers:

An excerpt:

In accordance with Section 3309 of the Affordable Care Act, effective January 1, 2012, individuals receiving Medicaid 1915(c) waiver services and enrolled in a Medicare Part D prescription drug plan (PDP), will no longer be responsible for Medicare Part D prescription co-payments. This change will impact individuals enrolled in Community Based Alternatives (CBA), Community Living Assistance and Support Services (CLASS), Medically Dependent Children Program (MDCP), Deaf Blind with Multiple Disabilities (DBMD), Home and Community-based Services (HCS) and Texas Home Living (TxHmL).

If an individual, as described above, is asked to make a co-payment for a Part D prescription after December 31, 2011, the individual (or the individual’s guardian) should inform his or her prescription drug plan (PDP) that he or she is receiving waiver services. The individual should provide documentation to the PDP confirming enrollment in a waiver. The PDP must forward the documentation to the Centers for Medicare & Medicaid Services (CMS) for use in updating its systems.

This earlier letter appears to be a duplicate of the above.

Proposed Rules

HHSC proposed new §351.507, adverse licensing, listing, or registration decisions by HHS agencies, in Chapter 351, Coordinated Planning and Delivery of Health and Human Services. The changes would permit agencies that license or regulate certain specified entities to consider adverse licensing decisions made by other HHS licensing agencies when considering a license application or renewal filed with that agency by another agency’s licensees. See the Texas Register for more information.

Adopted Rules

HHSC adopted amendments to §354.1041, Benefits for Medicare/Medicaid Recipients; §354.1143, Coordination of Title XIX with Parts A and B of Title XVIII; and §354.1149, Exclusions and Limitations. The new rules align Medicaid policies on cost sharing payments and limit Medicare Part B payments for services dual eligibles to no more than the Medicaid payment amount for the same service, with the exception of renal dialysis services. For details, see the Texas Register.

• On DADS’ Behalf

State Mental Retardation Authority Responsibilities – HHSC adopted the repeal of Subchapter I, In-Home and Family Support Mental Retardation Program, in Chapter 1, State Mental Retardation Authority Responsibilities, to remove those rules.

Mental Retardation Authority Responsibilities – HHSC adopted an amendment to §2.315, MRA administrative functions, in Chapter 2, Mental Retardation Authority Responsibilities, to remove the requirement that a MRA administer the In-Home and Family Support Program–Mental Retardation in its local service area.

Licensing Standards For Assisted Living Facilities – HHSC adopted an amendment to §92.2, concerning definitions, in Chapter 92, Licensing Standards for Assisted Living Facilities, to revise the definition of a “controlling person.”

States test health care reform flexibility. Essential benefits, which must be offered by insurers in most policies sold to individuals and small businesses, are one of the key flash points in the federal health law.  Patient advocates have called for a broad national standard covering a wide range of treatments, while business groups have said affordability must be a top consideration, even if it means a more limited package.” – Kaiser Health News

Texas gets approval for expanded managed care. “The five-year waiver from the Centers for Medicare and Medicaid Services (CMS) allows [Governor Rick] Perry to move almost 1 million additional Medicaid enrollees into privately run managed care plans, while still pulling down billions in federal matching funds for hospitals.” – Kaiser Health News

Federal labor laws now cover home health care aides: “The move would boost living standards for nearly 2 million employees who help the elderly and disabled with daily tasks such as taking medication, caring for wounds or preparing meals. But some health service companies warned that higher pay could also mean higher costs for clients who can least afford it.” AP

FAQs about the “Doc Fix” dilemma: “For doctors, the nail-biter has become a familiar but frustrating rite. Lawmakers invariably defer the cuts prescribed by a 1997 reimbursement formula, which everyone agrees is broken beyond repair. But the deferrals are temporary, and the doc fix has become increasingly difficult to push through a divided and deficit-wary Congress. Last year, Congress delayed scheduled cuts five times, with the longest patch lasting one year.” – Kaiser Health News

• Medicare to open up database for consumer and employee access. “In particular, the federal agency will relax its restrictions on the release of information about individual doctors who participate in Medicare, the $524 billion federal program for the elderly and disabled, reversing a three-decade position that doing so would violate physicians’ privacy rights. – Wall Street Journal

• Arizona court upholds Medicaid enrollment freeze: “Challengers had argued that the freeze violates a voter-approved 2000 law increasing eligibility in the Medicaid program. The law had also required the Legislature to pay for the increase by using ‘any other available’ money to supplement dollars from tobacco industry payments.” – MSNBC

• Gaps persist in state Medicaid spending: “On the other end, the 10 lowest-spending states — Utah, Arizona, Georgia, Idaho, Nevada, Texas, Colorado, Arkansas, California and Alabama — had lower average income and, by extension, more residents who were uninsured. Yet they also tended to have younger populations that were healthier overall, with lower rates of obesity and fewer smokers, the report noted.” – Governing

The controversial law has been challenged numerous times. Some courts have ruled the law constitutional; others have ruled it unconstitutional. Perhaps the most controversial provision is the individual mandate, which requires uninsured individuals to purchase insurance or face fines. Earlier this week, the U.S. Supreme Court agreed to hear arguments in the case. From Reuters:

The Obama administration asked the highest U.S. court to uphold the insurance provision, the centerpiece of the law, after 26 states separately asked that the entire law be struck down. Oral arguments would take place in March.
…
Here is a look at what the case could mean on several fronts…

* PROVIDERS – The healthcare law is expected to give hospitals a flood of revenue from newly insured patients. It also cuts the cost of emergency care for uninsured patients, which hospitals are legally bound to provide. Hospitals are banking on that offsetting the payment cuts they have already started taking under the law. Obama’s legislation increases payments to physicians, although hospitals get lower payments from Medicare and Medicaid.

• Medicare cuts lead to nursing home layoffs. “According to a new survey from Avalere Health, nursing homes plan to lay off about 20,000 workers because of the Medicare cuts. Nursing homes also said they plan to cancel a total of 400 expansion projects that could have created 20,000 new jobs nationwide.” – the Hill
• Will reducing price differences among hospitals lead to lower costs? “One way to reduce a difference like the $7,700 for back surgery, according to experts, would be to move toward a bundled payment model for health care. Rather than pay providers per procedure, which is known as fee-for-service, providers would be paid per health care episode — for example, the treatment of a heart attack. Several health care systems across the country are currently testing bundled payments, as is the Center for Medicare and Medicaid Services.” – Kaiser Health News
• Displease a patient, face a penalty. “Medicare’s new rule, mandated in the Affordable Care Act, pits hospitals against one another in a competition to best satisfy patients; those with the best scores will receive more money.” – Kaiser Health News
• Long term care dilemma. “Without a national solution, consumers are left on their own to plan for the possibility that someday they might need outside help to remain in their homes or to spend time in a nursing home. It’s planning that many of us avoid.” – Baltimore Sun

No one expects lawmakers to allow the axe to fall, but 48 million beneficiaries and their doctors are looking on nervously.

Temporary reprieves have created a recurring problem that gets harder and harder to fix. A 1990s budget law called for automatic cuts to doctors if Medicare costs kept rising. Congress has issued so many waivers that a permanent fix would now cost more than $300 billion over 10 years.

In related news, home health agencies face a 2.3 percent cut in 2012, which would decrease funding by about $430 million. Kaiser Health News reports:

Home health advocates decried the cut, saying it would lead some agencies to close. The decreased funding, announced Monday, lowers the average base payment to home health agencies for a 60 days “episode of care” to $2,138 in 2012 from $2,192 in 2011. In 2006, the average reimbursement was $2,337, according to the National Association for Home Care and Hospice.

About half the cut in the payment rate in 2012 and 2011 was the result of a provision in the 2010 health law that lowered the fees.

“We have not seen the closures of agencies, but we are reaching that breaking point,” said Bill Dombi, an association vice president.

The health care industry is bracing itself for waves of retiring Baby Boomers, some of whom eventually will need long-term care. If a significant percentage of this huge cohort opts for home care, the lower rates of reimbursement for these agencies doesn’t bode well for providers.

The Medicare Payment Advisory Commission has drafted recommendations to Congress that would block a 29.5% pay cut scheduled for 2012 and future across-the-board Medicare rate reductions, but the plan would pay for the changes by lowering rates for nonprimary care services. Supporters of the proposal said it could provide more stability to future payments under the Medicare program. But detractors warned that the concept would split the physician community and pit primary care physicians against specialists.

MedPAC policy analysts explained the proposal during a Sept. 15 meeting. Recommendations would set two fee schedules — one for primary care services and another for all other services. Payment rates for primary care would remain flat over 10 years, while payments for nonprimary care services would decline 5.9% a year for three years and then remain flat.

The 15-member commission is scheduled to vote on the proposal in October. If approved, the nonbinding recommendations would be delivered to lawmakers.

Total annual Medicare payments to physicians would rise from $60 billion in the first year of the decade to $120 billion in the 10th year. However, the conversion factor used for the primary care fee schedule would be about 20% higher than the conversion factor used to calculate final rates for all other services.

Specialists typically earn more than primary care physicians, and this fact partly accounts for the shortage of primary care physicians, as more medical students opt to specialize. MedPAC  seeks to lessen the impact reduced payments would have on these doctors, but at what cost to specialties?