September 26, 2023 12:07 pm

• Agencies lagging in donations, transplants may lose contracts
• Congress seeks more oversight and presses for reform

In the pre-dawn hours of August 7, tearful family members of Orlando Rios followed the gurney that carried his body down the hallways of an Albuquerque, N.M., hospital lined with mournful friends and staff.

The “honor walk” for the 28-year-old Rios marked both the tragic end of a life cut short by drug overdose and the beginning of efforts to sustain other lives through organs he donated.

Within days, New Mexico Donor Services, one of the nation’s 56 organ procurement organizations, helped arrange for an Illinois man to receive Rios’ heart. His kidneys would go to a woman in Maryland and a man in California.

Increased outreach to minorities, rising drug overdose deaths, and closer work with hospitals pushed the New Mexico agency into the top 25% of all OPOs nationwide in 2021 when it came to the number of donated organs they recovered.

But in another crucial metric—how many of those organs end up being transplanted—NDMS lagged. Its roughly 33% transplant rate on donated organs placed the organization among the nation’s lowest-performing OPOs in that category, according to the Centers for Medicare & Medicaid Services.

And if the number doesn’t quickly improve, it could be out of the organ donation business altogether.

OPOs that rank in the lowest-performing category, called Tier 3, next year face losing their exclusive federal contracts, typically worth tens of millions of dollars, in 2026. NMDS is one of 24 organizations nationwide in that danger zone, but the only one to simultaneously rank highest in one category and lowest in another.

Although the CMS has never decertified an OPO for poor performance, “that is a likely potential outcome due to these new measures” according to the rule that finalized the updated baseline metrics.

The tougher standards, and their potential to trigger mass decertifications, are the most significant developments in decades to the much-maligned process of procuring lifesaving organs for needy patients. And the situation is drawing increasing scrutiny from Congress and the Biden administration.

Some 104,000 people are on the national waiting list for an organ transplant, and 17 die every day. Another 13 fall from the list daily, too sick to survive the surgery. At the same time, researchers estimate 28,000 donated organs go unused in the US each year.

If every OPO met or exceeded the tougher CMS donation and transplant rate measures, there would be 5,600 more organs a year recovered, and transplant operations would rise from about 33,000 a year in 2018 to 41,000 by 2026, the agency estimates.

“We are not going to slow down to accommodate underperforming OPOs—tens of thousands of Americans need transplants every year, and they deserve better,” a Health and Human Services Department spokesperson said in a statement to Bloomberg Law.

The challenge of meeting the new performance metrics has created “significant concern” about what will happen next year, said Jill Grandas, executive director of the nonprofit DCI Donor Services, which operates the New Mexico agency and two other procurement organizations.

To increase their odds for more successful liver transplants, NMDS is trying to hire an abdominal surgeon who can recover livers from deceased donors, Grandas said during an interview at the group’s Albuquerque office.

Arturo Cruz, a 72-year-old Native American who has waited four years for a kidney, embodies the challenge faced by NMDS and other OPOs.

Arturo Cruz has waited four years for a kidney.

As they sat in the living room of Cruz’s small adobe home on the Ohkay Owingeh Pueblo last month, NMDS staffers could sense his frustration with the wait for an organ and his thrice-weekly dialysis treatments.

“I pray every morning for a kidney,” said Cruz, an NMDS volunteer who helps raise awareness about organ donations with Native Americans. “I still want to be here. I still have a lot to live for.”

‘Aligning’ the Mission

Cruz’s plight was a reminder that the most difficult aspect of the NMDS mission—facilitating transplants for the donated organs they’ve obtained—is also the task over which they exert the least control.

The hospitals with approved transplant centers largely decide which organs to use and who gets them. Pressure for successful transplants often lead them to reject less-than-optimal organs.

But transplant centers’ “strong regulatory disincentive” to transplant imperfect organs isn’t likely to change until the regulatory bodies overseeing the hospitals “eliminate or substantially modify the use of one-year outcomes measures in assessing” transplant centers’ performance, the American Society of Transplant Surgeons said in a 2020 letter to the CMS.

“If they’re holding OPOs to transplant as many organs as possible, then they can’t be dinging the transplant centers if they have a bad outcome when they use an organ from an older-age donor, or a more medically complex donor. That’s not aligning this whole mission that we’re under,” said Barry Massa, immediate past president of the Association of Organ Procurement Organizations, and executive director of LifeCenter Organ Donor Network, a Cincinnati OPO.

Research by Penn Medicine in 2019 found that more than 17,500 donated kidneys that US hospitals rejected over a decade would have been deemed acceptable for transplants in France.

Utilizing more high-risk organs “as do European countries” could help lead to 10,000 more transplants annually, declared a 2021 letter from the transplant surgeons association, the American Society of Transplantation, and the United Network for Organ Sharing.

Yet many feel the increased pressure to improve OPO performance is still necessary. The nonprofit agencies have faced criticism for their widely varying performance, lack of accountability, and weak federal oversight. Poor performers were seldom held accountable. In previous years, they were allowed to self-report their organ procurement and recovery rates, spurring questions about the data.

Reports of lost and misplaced organs, misuse of taxpayer funds, high salaries for OPO officials, and poor service to minorities, who are more likely to need an organ, have made OPOs a hot target for congressional reform legislation.

“From the very beginning there were laggards and there’s really never been, until now, a serious effort to address that,” said Jerold Mande, a professor of nutrition at Harvard and former congressional staffer who helped draft the 1984 legislation that defined OPOs. “Until HHS identifies, and maybe decertifies at least one or a couple of OPOs, they don’t seem to take the threat seriously. Or the system seriously.”

OPOs hold federal contracts that give them the sole authority to recover organs from deceased donors in specific regions known as “donor service areas.” They also identify potential donors, seek consent from donor families, work with other organizations to find transplant recipients and help transfer organs to transplant hospitals.

Once an OPO is decertified, other procurement organizations that meet CMS standards could compete for their service areas. If that didn’t happen, CMS would assign one or more procurement groups to take over all or part of any uncovered service area “so that no area is left without OPO representation,” the agency said.

High-performing OPOs are already anticipating the opportunity to assume new territories in 2026. But they can’t plan for that possibility until the CMS goes through the federal rulemaking process and issues guidance on how to proceed.

It’s also unclear if the time-consuming notice-and-comment rulemaking process could delay the decertifications. But critics in Congress are pressing for reforms.

“OPO reform should be an immediate priority. CMS must move decisively and ensure that the finalized rule is not weakened,” said a statement from Sen. Charles Grassley (R-Iowa).

Questions About Conflicts

The National Organ Transplant Act requires organ procurement organizations to help tissue banks retrieve, process, preserve, store, and distribute human tissue. And most OPOs have their own tissue recovery operations.

These enterprises could pose a conflict of interest by potentially creating an “incentive to pursue opportunities that are going to be lucrative,” as opposed to their primary purpose, which should be organ procurements, said Sharona Hoffman, a professor of law and bioethics at Case Western Reserve University.

But organ and tissue donation “never compete with each other” because organs must be removed first due to a limited survival time outside the body, said a statement from Colleen McCarthy, the current president of the OPO trade group.

New Mexico Donor Services conducts roughly 500 tissue recoveries a year, and is reimbursed between $150,000 to $300,000 per month for the service, according to Wayne Dunlap, its executive director. Its 90 to 100 annual organ recoveries generate reimbursements of about $1 million per month, he said.

The organization’s parent company, DCI Donor Services Inc., reported $105 million in revenue and $94 million in expenses in 2021, the last year for which its returns are public. About a third of its spending went to organ procurement.

An ongoing Senate Finance Committee investigation into possible “self-dealing” and conflicts of interest among OPO officials has also raised the stakes for the groups. Earlier this month, the committee sent inquiry letters to eight current and former board members or officials of the industry trade group, seeking information about business activity involving their individual OPOs.

Dunlap, who heads the New Mexico organization, received a letter. So did Massa, McCarthy, and an official of the Tennessee OPO that’s operated by DCI.

The senators noted that DCI owns a private transportation company, and they asked Dunlap for passenger logs for flights to see if they were billed to Medicare. The investigation of New Mexico Donor Services “and other OPOs across the country is just the tip of the iceberg when it comes to OPO misconduct,” Grassley said. “We’ll keep working to bring about real reform in the system.”

In a statement, Dunlap told Bloomberg Law: “We are cooperating with the request for information.”

Others pushed back on the criticism. “The Senate letters question the ‘legitimate business practices’ of officials who’ve dedicated decades of their lives to advancing the mission of organ donation and transplantation,” said a statement from Steve Miller, CEO of the organ procurement trade group.

Beyond the Senate probe, the possibility of decertifications continues to roil the OPO ecosystem. In a statement, the organ procurement association urged Congress “to take these concerns seriously and act now to prevent unnecessary and harmful disruption to the organ donation and transplantation system that will result from vast decertification.”

Patient advocates say OPOs should be able to improve and fend for themselves under the tougher new regulations.

“What terrifies me is not decertifying a failing OPO, but allowing it to keep its contract,” said Greg Segal, co-founder of ORGANIZE, a nonprofit patient advocacy organization. “The single most fatal aspect of the organ donation system is the lack of urgency, accountability, and professionalism at OPOs, which is exactly what decertifications will address.”

Improving OPO performance quickly can be done. Massa’s Cincinnati OPO— which is also facing Senate scrutiny—jumped from the lowest performance category in 2020 to the highest in 2021. He credited the improvement to using best practices from high-performing OPOs, shifting advertising dollars to minority outreach, and working more with transplant centers that accept imperfect organs.

Ginny McBride, executive director of OurLegacy, a high-performing OPO in east central Florida, said one fix could be to tailor the organ wait list to identify patients whose medical conditions make them the best candidates to receive less-than-optimal organs.

The CMS reimburses OPOs for their costs in helping recover and transplant kidneys for Medicare beneficiaries. For costs involving all other organs, OPOs bill the transplant centers. Congress designed the funding system to incentivize OPOs to pursue all organs, Mande said.

Getting reimbursed “regardless of performance” doesn’t “give OPOs an incentive to reallocate resources in order to increase the number of organs,” said a 2020 report by the Bridgespan Group, a consultant group that works with nonprofits. OPOs also have incentives to inflate their charges and misrepresent their expenses, said a recent report by the HHS Office of Inspector General.

President Joe Biden’s fiscal year 2024 budget asks Congress to “remove restrictions” that prevent the creation of new OPOs. Under current law, only certified OPOs can be recertified, which effectively keeps new ones from being established.

As the tumult around OPOs plays out, they’ll continue to rely on the altruism of families like Rick and Kristi Ingle of Albuquerque.

The Ingles’ daughter, Kelli, was killed in a car accident in April 2022, weeks before her scheduled graduation from Grand Canyon University in Phoenix. The Ingles knew their daughter was a registered organ donor, but didn’t know what to expect of the recovery process until staff at NMDS guided them through.

“We had a lot of people that helped us through that process that were amazing,” Rick Ingle said in an interview at the NMDS office. “It was sad, but exciting at the same time.”

“It sounds strange,” added Kristi Ingle, sitting beside her husband, “but it really gave us hope to know that she would be able to help somebody else.”

At the request of a church member, the Ingles designated Kelli’s liver for a then-31-year-old Colorado woman. She has since moved to Albuquerque, just blocks from the Ingles, and now sees them each week at Bible study.

The Ingles also hope to forge a relationship with the two women in Texas who got Kelli’s kidneys.

“We just think it would be a great experience again,” said Rick Ingle.

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BGOV Bill Summary: H.R. 5378, Health-Care Pricing Package

September 18, 2023 3:30 pm

The measure would prohibit PBMs from engaging in “spread pricing” — when they charge a health plan more for a drug than they reimburse to pharmacies and keep the difference — in state Medicaid plans. PBMs contract with health plans to negotiate discounts and formulary placement with drugmakers, and negotiate drug distribution and reimbursement with pharmacies.

Read More: BGOV OnPoint: Congress Eyes Changes to Drug Middlemen Practices

Community health centers and other programs would be extended for several years, while scheduled Medicaid cuts would be delayed for disproportionate share hospitals (DSH) that serve large numbers of low-income and uninsured patients.

The health-care package, which has drawn some bipartisan support and incorporates several bills approved by three House committees with jurisdiction over health issues, aims to boost transparency for patients and crack down on practices that lawmakers say drive up prescription drug costs.

“Our bipartisan legislation meets this moment by giving patients what they are rightfully demanding: the ability to get the right care, at the right time, at a price they know and can afford,” House Energy and Commerce Chair Cathy McMorris Rodgers (R-Wash.) said in a Sept. 8 news release.

Extensions

Community Health Centers: The bill would provide $4.4 billion per year in mandatory funding to the Community Health Center Fund for fiscal 2024 and 2025, and another $1.1 billion through the final three months of calendar year 2025.

The fund, which is set to expire Sept. 30, accounts for 70% of federal funding to community health centers, according to the National Association of Community Health Centers. Health centers also receive separate discretionary funding through annual appropriations.

Medicaid Hospital Payments: The bill would eliminate $8 billion in annual cuts to DSH payments for fiscal 2024 and 2025. The payments are intended to offset the cost of uncompensated care for hospitals that serve large numbers of low-income and uninsured patients.

The cuts, which were included in the Affordable Care Act (Public Law 111-148) in anticipation of falling uninsured rates, have been continuously delayed and are now set to take effect Oct. 1 for fiscal 2024 and run through fiscal 2027.

Other Programs: The bill would also:

• Extend funding for the National Health Service Corps, which provides scholarships and loans to medical students, through calendar year 2025, including $350 million each for fiscal 2024 and 2025 and another $88.2 million through December 2025.
• Extend funding for the Teaching Health Center Graduate Medical Education Program through fiscal 2030, including $175 million each in fiscal 2024 and 2025, $225 million each in fiscal 2026 and 2027, and $300 million each in fiscal 2028 through 2030.
• Extend funding for the Special Diabetes Program and the Special Diabetes Program for Indians through 2025 at $170 million per year in fiscal 2024 and 2025 for each program, plus $42.8 million for the remainder of calendar year 2025 for each program.

Pharmacy Benefit Manager Changes

Spread Pricing Ban: The measure would require any contract between a state Medicaid program and PBM would have to require that payment for drugs and administrative services be based on a “pharmacy price reimbursement model.”

That would include requiring any payment made by a PBM to be limited to the ingredient cost and a professional dispensing fee. Payment would have to be passed through entirely to the pharmacy and couldn’t be retroactively denied or reduced unless it’s the result of an audit.

States would compensate PBMs through an administrative fee “that reflects the fair market value of providing such services.” PBMs would have to make available to the state, and the Health and Human Services Department when requested, all costs and payments related to covered drugs and administrative services.

Any form of spread pricing by the PBM wouldn’t be allowed for purposes for claiming federal Medicaid matching payments.

The spread pricing ban would apply to Medicaid contracts with an effective date beginning 18 months after the bill’s enactment.

Under the measure, HHS would have to conduct a survey of pharmacies to determine the national average drug acquisition cost and make the information publicly available. States would have to require pharmacies participating in Medicaid to respond to the surveys. HHS could enforce noncompliance with the survey requirements by imposing penalties on pharmacies.

PBM Transparency: Beginning two years after the bill’s enactment, PBMs would have to report information to plan sponsors at least twice a year, including:

• Their drug selections and acquisition costs.
• Rebates, fees and other compensation.
• Out-of-pocket drug spending by plan participants.
• The rationale behind formulary placement for drugs.
• Explanation behind plans that direct enrollees to fill prescriptions with a pharmacy that is owned by the same parent company as the PBM.
• The percentage of prescriptions dispensed by pharmacies under common ownership with the PBM.

PBMs would be barred from entering into a contract with drugmakers or other entities that limits disclosure of the required information.

HHS could impose fines totaling $10,000 each day for entities that don’t comply with the reporting rules, or $100,000 per each item of false information provided.

Fiduciary Rules: The measure would prohibit contracts between health plans, PBMs, provider networks or other entities that prevent plan fiduciaries from reviewing or auditing claims information to determine the “reasonableness” of compensation that the entity receives.

The Labor Department could assess civil penalties of as much as $10,000 per day against any entity that violates price transparency requirements. Plan fiduciaries would have to annually attest to the department that the plan meets those requirements.

PBMs and third-party administrators would also have to annually disclose information to fiduciaries on their total compensation, including all fees, rebates and pharmacy clawbacks, and drug spending. The disclosures would apply to contracts signed after Jan. 1, 2025.

‘Gag Clause’ Ban: The measure would bar health plans from restricting pharmacies from informing patients of the difference they pay out-of-pocket for drugs under their insurance plan compared to the amount they could pay without using insurance.

Plans would be required to ensure that PBMs they work with don’t restrict pharmacies from informing patients of the out-of-pocket difference.

Other Transparency Requirements

Provider Pricing: Starting Jan. 1, 2026, hospitals and ambulatory surgical centers would have to disclose prices for at least 300 common services to patients, including the gross charge, discounted cash price, and insurer-negotiated costs for each service.

HHS would have to establish a uniform method for providers to compile prices and make them public in a machine-readable format. HHS could impose civil penalties on providers that don’t comply with the rules and would be required to maintain a website detailing each hospital’s compliance.

The measure would also require laboratories to disclose prices for clinical diagnostic lab tests starting in 2026. Imaging services providers would have to disclose prices starting in 2028. Both would have to disclose the discounted cash price, or gross charge if there is none, and insurer-negotiated prices in a machine-readable format, and would be subject to civil penalties for noncompliance.

Health Coverage: Starting in 2026, group health plans would have to disclose the amount of money a participant or beneficiary would have to spend out-of-pocket on a specific item or service when requested. The information would have to include in-network rates; the maximum coverage amount for out-of-network services and any additional charges for which the patient may be liable; cost-sharing amounts from deductibles, copayments, or coinsurance; and any coverage limitations or requirements under the plan.

Health plans would be required to maintain a self-service tool online to provide the requested information in real time.

Group health plans would also have to make rate and payment information public each month, including in-network rates for services and drugs, the average amount paid for drugs dispensed to in-network providers, and amounts billed by out-of-network providers.

Medicare Organizations: Starting in 2025, Medicare Advantage organizations would have to report information to HHS on incentive-based payments made to health-care providers with an ownership or control interest in the organization, as well as shared losses recouped from them.

Medicare Part D drug plan sponsors would have to report to HHS on each pharmacy in which the sponsor, or a pharmacy benefit manager offering services under the plan, has an ownership or control interest.

Starting in 2029, the Medicare Payment Advisory Commission would have to release a report on the state of vertical integration in Medicare every three years.

Funding & Offsets

Funding: The measure would provide HHS and the Treasury Department with $25 million to implement the transparency and PBM provisions. The Labor Department would receive $12 million to implement the bill’s changes under its purview.

The bill would also cut $7 billion from the Medicaid Improvement Fund.

Generic Drug Development: The measure would direct HHS to inform generic drug applicants of whether their ingredients are “qualitatively and quantitatively” different from those in the brand-name drug.

HHS would be required to disclose the ingredients that would enable the generic drugmaker to establish “sameness,” a requirement to receive FDA approval.

The department couldn’t change or rescind a sameness determination after a generic drug application is submitted unless the formulation of the brand-name drug has changed because of safety or effectiveness, or unless an error was identified in the determination.

Within one year of the bill’s enactment, HHS would have to issue guidance on how it would determine whether a generic drug is qualitatively and quantitatively the same as the brand-name drug.

Off-Campus Outpatient Departments: Under the measure, Medicare and its beneficiaries would pay the same rate for physician-administered drugs in off-campus hospital outpatient departments as they do in physician offices, which typically have lower payment rates, according to the American Medical Association.

HHS would phase in the provision over four years, with the site-neutral payments being fully applicable beginning in 2028, or 2029 for hospitals in rural areas or areas with a shortage of health-care workers.

The measure would also require providers’ off-campus outpatient departments to obtain their own standard unique health identifier when billing for services on or after Jan. 1, 2026. Providers would have to attest to HHS that their departments are compliant with federal regulations related to provider-based status.

Budget Effects

The measure would reduce the deficit by $833 million from fiscal 2023 through 2033, according to a Sept. 14 Congressional Budget Office cost estimate, with some of the biggest savings coming from reduced Medicare payments to off-campus outpatient departments.

CBO estimates that the total cost of the private sector mandates in the bill would exceed the threshold set in the Unfunded Mandates Reform Act (UMRA), which is $198 million in 2023. Such mandates would include information collection requirements for PBMs, health insurers, health plan fiduciaries; fee disclosures; and gag clauses on pharmacies.

The bill also would impose intergovernmental mandates on hospitals and other health-care facilities by expanding an existing requirement to publish prices of services. The cost of the mandates would fall below the UMRA threshold, which is $99 million for the year.

Previous Action

Rodgers introduced the measure, called the “Lower Costs, More Transparency Act,” on Sept. 8 with Reps. Frank Pallone Jr. (D-N.J.), ranking member on the Energy and Commerce Committee; Jason Smith (R-Mo.), chair of the Ways and Means Committee; and Virginia Foxx (R-N.C.), chair of the Education and the Workforce Committee. Rep. Richard Neal (D-Mass.), ranking member on the Ways and Means Committee, opposes the bill.

The bill contains provisions from multiple committee-approved bills, including:

• H.R. 3561, which the Energy and Commerce Committee approved 49-0 on May 24.
• H.R. 4507, which the Education and the Workforce Committee approved 38-1 on July 12.
• H.R. 4508, which the Education and the Workforce Committee approved 39-1 on July 12.
• H.R. 3284, which the Ways and Means Committee approved 23-17 on July 26.

Prospects

The House is scheduled to consider H.R. 5378 under suspension of the rules on Sept. 18. A two-thirds majority would be required for passage.

To contact the analyst: Karl Evers-Hillstrom in Washington at kevershillstrom@bloombergindustry.com

To contact the editors: Danielle Parnass at dparnass@bloombergindustry.com; Naoreen Chowdhury at nchowdhury@bgov.com

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September 15, 2023 2:05 pm

Here Is What We Know:

• House Republicans are discussing a three-to-four-week stopgap funding measure to avert a partial government shutdown starting Oct. 1. So far, The House has been unable to pass 11 out of 12 annual bills that typically fund the government, except for one covering military construction and veterans’ affairs.
• GOP hardliners have expressed opposition to a stop-gap measure unless it contains conservative priorities, threatening to oust Speaker Kevin McCarthy from his role if he allows a vote on such a bill.
• McCarthy has announced the launch of a Biden impeachment inquiry over the business dealings of his son, Hunter, and the family finances. “The best I can tell is they want to impeach me because they want to shut down the government,” Biden said.

What We Expect: The most realistic scenario is for Congress to pass a continuing resolution, stop-gap measure, that extends 2023 spending levels for a designated period. No decision has been made on the time frame of the CR; however, the three-week option discussed at Wednesday’s conference meeting may be the happy medium between a 24-hour bill some have floated, and the 60 days McCarthy was considering.

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Read on for a more detailed breakdown

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House Republicans Threaten Shutdown

The need for a continuing resolution stems from a divide between the chambers over appropriations levels. Despite reaching a deal on spending caps to avert a debt ceiling crisis in May, House GOP conservatives are shortchanging Democrats appropriation request while the Senate, on a bipartisan basis, has added more money.

Because the Senate is unlikely to agree to these cuts, and Biden won’t sign them, House Republicans have put an official stamp on their intent to shut the government down this September.

• The House Republican caucus is intent on passing bills that Democrats find unacceptable; including conservative amendments on abortion and other social issues.
• Disagreement has led to several heated debates during House Appropriations Committee markups, especially after Republicans opted to eliminate funding for three LGBTQ projects in the transportation and housing bill after including them in the original legislation.
• Republican House members have 62% of earmarked funds – nearly $7.4 billion – while allocating about 28% to Democratic projects at just under $2.8 billion.

Appropriations for HHS

• The House Labor, HHS, and Education bill has yet to pass through the full committee, likely due to Republicans having tucked anti-abortion language into nearly every corner of the appropriations process, complicating the delicate negotiations.
• For now, Democrats are largely counting on the Senate to act as a “firewall” against the House health proposals citing the upper chamber’s recent success in voting eight out of 12 spending bills out of committee with the support of Republicans and without the new abortion riders.

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House To Vote On Tweaked Transparency, PBM & Extenders Package Next Week

September 13, 2023 4:32 pm

The House plans to take up a tri-committee package of pharmacy benefit manager reforms, provider price transparency, hospital drug administration site-neutral pay and extenders next week under suspension of the rules, according to the Congressional Budget Office, but that office does not yet have an estimate on the cost of the package.

Under the suspension of the rules, floor debate is limited prior to a House vote and all floor amendments are prohibited while points of order against the bill are waived and final passage requires a two-thirds majority vote.

The Lower Costs, More Transparency Act was unveiled last week by the Energy & Commerce, Ways & Means and Education & the Workforce committees, though the version set to be taken up under suspension tweaks a provision on ambulatory surgical center price transparency so it would not be limited only to ASCs owned by hospitals.

The package draws in part from the PATIENT Act, which passed the House Energy & Commerce Committee on a bipartisan basis, as well as from legislation passed by the Ways & Means Committee on a partisan basis.

While House Energy & Commerce ranking Democrat Frank Pallone (NJ) is listed as a cosponsor of the merged legislation, the ranking Democrats from Ways & Means and Education & the Workforce are not listed.

However, Julius Hobson, senior policy advisor at Polsinelli, said opting to bring the legislation to the floor under the suspension of the rules likely means House leadership believes it has the necessary support. The move could also give the package momentum heading into the upper chamber, Hobson said.

McDermott+Consulting earlier this week said the House package could be a way of setting parameters for a year-end bill, though others said the package could be a way to tackle certain expiring health programs without attaching them to a potentially contentious continuing resolution.

CBO’s notice on the bills to be taken up under the suspension of the rules does not include a score for the Lower Costs, More Transparency Act, however.

“CBO has limited time to review the legislation before consideration. Although it is possible in most cases to determine whether the legislation would affect direct spending or revenues, time may be insufficient to estimate the magnitude of those effects,” CBO says.

CBO previously estimated the PATIENT Act as passed by Energy & Commerce would save about $365 million over 10 years. — Michelle M. Stein (mstein@iwpnews.com)

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Lobbyists Confront Challenges In Hospital At Home Push

August 29, 2023 2:29 pm

August 24, 2023 7:03PM ET

(Inside Health Policy)

As health systems press state and federal policymakers to continue coverage of CMS’ Acute Care at Home program beyond 2024, bigger questions are brewing as to what a permanent coverage program should look like.

At issue for setting a long-term hospital at home coverage program is what payment model should be used, and how to achieve standard measures of quality and outcomes to assess the programs. Then, there are the seemingly unending questions on how the federal program interacts with standing state regulations on hospital beds, certificate of need laws and state Medicaid programs.

While lobbying states and CMS, health systems are also working with commercial payers to continue the programs regardless of Medicaid or Medicare coverage due to the ongoing capacity crises in hospitals and cost savings achieved through the program.

A 2020 waiver by CMS allowed hospitals to apply for the Acute Care at Home program, which let the health care organizations provide in-patient-level care to patients at home to offset the droves of COVID-19 patients inhabiting hospital beds. Hospitals at home typically combine home visits by health care professionals, telehealth visits, and remote monitoring devices to care for acute conditions. Congress extended the waiver through Dec. 31, 2024, and called for HHS to conduct a study comparing the quality and quantity of services as well as the clinical conditions of patients served in inpatient and home settings.

Though CMS gave hospitals the green light on the programs — which shortened patient stays and improved mental health — much of the actual implementation hinged on whether state Medicaid programs decided to cover it, as the CMS waiver did not require them to.

Few states opted to cover hospital at home programs. Colleen Hole, vice president of clinical integration and chief nurse executive at Atrium which runs the nation’s largest hospital at home program, told Inside TeleHealth that only nine or 10 hospital at home Medicaid waivers exist.

North Carolina Medicaid, where Atrium is located, toggled back and forth during the public health emergency on whether to cover the program and provided coverage in spurts. Ultimately, NC Medicaid stopped paying for the program in March 2022 for nebulous reasons, but it began reconsidering data in November 2022.

In recent weeks, Hole has advocated for Medicaid coverage on a call with Medicaid officials and other stakeholders. Atrium is leveraging a health equity argument for coverage of the hospital at home program, saying that going into the home helps health care professionals understand a patient’s social drivers of health like access to food or other living conditions.

Hospital at home could be an enduring model for providing acute patient care and decrease pressure on hospital bed capacity, advocates of the program also say.

However, policymakers must answer fundamental questions on payment, standard of care, and how to count the virtual hospital beds within the state’s allotted bed count.

“Here we are with just about 18 months or less to go. And so we’re trying desperately to continue those conversations with state and federal supporters. And honestly, I don’t know what’s going to happen. I don’t think anybody does,” Hole said.

States regulate hospital bed licenses and certificate of need (CON) laws govern when and how more hospitals should be built in a state. Hole said state regulators are unclear whether the virtual in-patient beds count towards a hospital’s total bed count and if CON law should even apply to hospital at home.

Moreover, there are also questions about how the program should be paid for. While during the public health emergency hospital at home was paid for through DRG (diagnostic related group) payment, some say the program should fall to CMS’ innovation center as a pilot program moving forward. Others argue for a 30-day or bundled payment model, but Hole says payers and hospitals both would not understand how to process the claims.

Moreover, the program needs to produce robust data to convince CMS of its merit and create standard definitions and outcome measures to assess existing and new programs. A collection of health systems are working on this front to develop a database, including UMass, Mount Sinai, Mayo Clinic, Atrium and Intermountain. Moreover, the industry needs to “create common language, common metrics, and outcome targets,” she said.

CMS and states have a host of issues to untangle to create an effective hospital at home care model to last beyond COVID-19 waivers, but whether federal and state governments can sort out the issues in time for a new program to be established by the end of December 2024 will not deter Atrium from surging ahead.

“Whether it passes or not, we still have a significant capacity problem here in our market. We’re in a growing market in North Carolina. So we’ve got to create acute care capacity one way or another. And, you know, we are still building some hospitals. But this is absolutely part of our strategy to scale to 100 and probably even 200 and maybe beyond in-patient beds,” Hole said.

Atrium has been working with commercial payers to establish a long-term program — one that wouldn’t be as legally complicated as CMS’ wavier.

“If we lose CMS funding, both Medicare and Medicaid never pay, we will continue to work with commercial payers. But the model will look a little bit different. We’ll still be delivering hospital level care. But quite frankly, we get out from under some of the rigidity of the waiver. And have more flexibility in where the patient can come from. They can come from their own home without having to come to a hospital to go back home. They can come from a doctor’s office. So we’re doing that really in parallel to our current CMS waivered inpatient programs,” Hole said.

Without CMS’ definition that hospital at home programs are technically in-patient programs, health systems could avoid state bed licensure issues and certificate of need laws, Hole said. Other clunky requirements could also disappear, such as a patient having to go into a hospital before being transferred to the hospital at home program.

Hole predicts CMS ultimately will do another extension of the current Acute Care at Home program because the agency and industry do not have enough time to come up with a vetted and thorough program by next December. — Emma Beavins (ebeavins@iwpnews.com)

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AHA Comment Letter on CMS’ Home Health Prospective Payment System Proposed Rule for CY 2024

August 29, 2023 2:16 pm

Submitted electronically.

August 28, 2023

The Honorable Chiquita Brooks-LaSure
Administrator
Centers for Medicare & Medicaid Services
Hubert H. Humphrey Building
200 Independence Avenue, S.W.
Room 445-G
Washington, DC 20201

Re: Medicare Program; Calendar Year (CY) 2024 Home Health (HH) Prospective Payment System Rate Update; HH Quality Reporting Program Requirements; HH Value-Based Purchasing Expanded Model Requirements; Home Intravenous Immune Globulin Items and Services; Hospice Informal Dispute Resolution and Special Focus Program Requirements, Certain Requirements for Durable Medical Equipment Prosthetics and Orthotics Supplies; and Provider and Supplier Enrollment Requirements; 88 Fed. Reg. 43,654 (July 10, 2023)

Dear Administrator Brooks-LaSure:

On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, including approximately 1,000 hospital-based home health (HH) agencies, and our clinician partners – more than 270,000 affiliated physicians, 2 million nurses and other caregivers – and the 43,000 health care leaders who belong to our professional membership groups, the American Hospital Association (AHA) appreciates the opportunity to comment on the calendar year (CY) 2024 HH prospective payment system (PPS) proposed rule.

Our comments focus on CMS’ proposed budget neutrality adjustment related to the Patient-Driven Groupings Model (PDGM) under the HH PPS as well as its proposed market basket update. The AHA is extremely concerned that these policies, if finalized, would result in an overall net negative update to the HH PPS. We urge the agency to adequately resource HH providers as they are a critical part of the care continuum. We are particularly concerned about the substantial size of the agency’s proposed budget neutrality adjustment, a cut of 5.653%, and again call on CMS to withdraw it. Instead, we urge the agency to revise its methodology to more accurately account for changes in care delivery and payment dynamics due to the implementation of the PDGM. We also have concerns about the inadequacy of the proposed market basket update given the financial pressures facing HH agencies, including critical staffing shortages and rising supply costs. In addition, final data from CYs 2021 and 2022 indicate that the market basket forecasts underpaid HH agencies by a combined 5.1% for these years. This, combined with the difficult inflationary environment and the large budget neutrality adjustment proposed in this rule, risks putting HH agencies in serious financial peril. As such, we urge CMS to utilize its authority to provide a market basket adjustment to account for these extraordinary circumstances.

HH PPS PAYMENT PROPOSALS

PDGM Behavioral Offset

AHA reiterates its staunch opposition to CMS’ proposal to continue to apply a PDGM budget neutrality adjustment based on a defective methodology. The agency specifically proposes to cut the standardized 30-day period payment rate by 5.653% in CY 2024. As described below, using this flawed methodology would erroneously lower overall payment levels to HH providers relative to the prior payment system. In addition, these proposed reductions have the potential to exacerbate capacity issues throughout the entire continuum of care, including for acute-care hospitals. Therefore, the AHA again calls on CMS to revise its methodology to more accurately account for changes in care delivery and payment due to the PDGM transition.

In compliance with the Balanced Budget Act (BBA) of 2018, CMS implemented the PDGM case-mix system together with a 30-day payment episode on Jan. 1, 2020. This law called for a budget neutral implementation that centered on the new 30-day episode of care. The adjustment includes two types of behavioral offsets:

The BBA did not specify a particular methodology for determining budget neutrality. Indeed, CMS’ budget neutrality adjustment for CY 2020 was set prospectively at -4.36% based on several assumptions regarding expected provider behavioral changes. Specifically, CMS assumed that HH agencies would alter their coding of primary and secondary diagnoses, both of which are key drivers of the PDGM payment setting process. In addition, CMS assumed that the number of low-volume cases, known as low-utilization payment adjustment (LUPA) cases, would decrease.

By law, the budget neutrality adjustment process will continue to occur each year through 2026, although the agency deferred action until CY 2023 in response to the COVID-19 pandemic. For CY 2023, CMS finalized a -7.85% permanent adjustment for purported overpayments in CYs 2020-21, to be applied over two years (CYs 2023 and CY 2024). Thus, in this CY 2024 rule, the agency is proposing to apply the second half of this reduction, a cut of 3.925%. However, it is also proposing an additional permanent adjustment to account for estimated CY 2022 overspending. In total, it proposes a cut of 5.653% for CY 2024. Finally, CMS says that while it has not yet proposed any temporary adjustments, it currently estimates it will need to recoup a total of approximately $3.4 billion in future years, which, for context, would be approximately a 20% reduction if applied in a single payment year at current net payment levels.

CMS’ Methodology Remains Flawed. The AHA reiterates its concerns that CMS overlooked numerous factors when calculating its PDGM-related budget neutrality adjustments. As discussed in our comment letters for CYs 2022 and 2023, the three behavioral assumptions that CMS made when calculating its initial adjustment of -4.36% did not match actual behavior by the field in CY 2020.

In addition, as AHA also has raised in its preceding year’s comment letters, CMS’ methodology for determining budget neutrality does not account for the drop in average per-episode therapy services under PDGM. This shift in care delivery means that CMS cannot simply reprice claims as it has done to date; instead, it must account for these additional dynamics to reach an accurate budget neutrality figure. Indeed, PDGM shifted incentives away from therapy visits resulting in a different unit of care with a new clinical and cost profile, which is incomparable to the pre-PDGM unit of care. Accounting for such shifts in care delivery when calculating budget neutrality is precisely what CMS did for the transition to the new PDPM under the SNF PPS. When determining a behavioral adjustment under that system, CMS determined that a drop in therapy utilization meant that comparison of data between the two payment systems would lead to a significant underestimation of what payments would have been under the prior system, thus leading to an inappropriately higher budget neutrality adjustment.¹ However, for its PDGM calculations, CMS has refused to factor in changes in therapy delivery, which dropped by 29.7% in CY 2020, relative to CY 2019.

In addition, the PDGM framework – with 432 payment units, a 30-day episode of care and multiple case-mix levers – is significantly different, and therefore impossible to crosswalk to the prior payment system – with 153 payment groups, a 60-day episode of care and one dominant case-mix factor (therapy volume). Given these multiple, major differences, and consistent with CMS’ position noted above on the SNF PPS parity adjustment, PDGM-era claims from CY 2020 and 2021 cannot simply be recalculated using the prior payment system’s parameters to estimate what payments would have been under the prior model. Combining this significant shortcoming with a global pandemic that temporarily but fundamentally reshaped hospital and post-acute practices makes the repricing comparison done by CMS even more unsound.

We refer CMS to AHA’s comments in response to the CYs 2022 and 2023 HH PPS proposed rules for the entirety of our methodological objections to CMS’ budget neutrality approach. In addition, AHA reiterates its strong support for the analysis commissioned by the Partnership for Quality Home Healthcare, which has raised substantial concerns with the accuracy of the PDGM budget neutrality cuts. For these reasons, AHA continues to urge CMS to withdraw its proposed budget neutrality cuts and revise its methodology to more accurately account for changes in care delivery and payment dynamics due to the transition to PDGM.

Budget Neutrality Adjustments Jeopardize Access to Care and Disrupt the Care Continuum. CY 2023’s budget neutrality adjustment accelerated the strain on a HH field that already had been facing a two-pronged challenge of a critical labor-shortage and a particularly sharp inflationary environment. The imposition of additional cuts could seriously imperil Medicare beneficiaries’ access to HH services and contribute to additional limits in hospitals’ capacity to care for patients.

The most recent analysis from Kaufman Hall in its National Hospital Flash Report indicates that from 2020 to present, overall expenses have risen by 22% for hospitals.² Although HH agencies have a different mix of goods and services, many of the key components of their expense profiles are the same, such as heavy reliance on nurses, nurse aides, therapists and other clinicians, as well as medical supplies. Indeed, much of the increase in expenses for health care providers have been driven by labor costs, including contract labor costs, which have risen 258% since 2019.³ As CMS knows, there has been a nationwide shortage of both clinical and non-clinical workers, including those needed to staff HH agencies. With reductions to payment rates, HH agencies struggle to retain and train staff to provide high-quality care for Medicare beneficiaries. Further, the Department of Health and Human Services (HHS) has found that health care workforce shortages will persist well into the future, meaning that CMS’ plan to continue to apply erroneous budget neutrality adjustments will continue to accelerate serious threats to the HH field’s ability to properly recruit and staff for their patients’ needs.⁴

In addition to labor costs, medical supply costs per patient have risen 18.5% from 2019 through 2022. Drugs make up a large portion of this increase, with an HHS study finding that many commonly used drugs have had their price increase by more than 30% in recent years.⁵

The threat to access to care is not hypothetical. Indeed, recent data highlight the ongoing reduction in access to HH services. Specifically, a 2023 report from Careport demonstrates that as the COVID-19 pandemic continued, patients were increasingly rejected from HH agencies as providers struggled to meet staffing demands.⁶ Notably, the rejection rate rose to 76% at the beginning of CY 2023, the highest levels ever recorded, which coincided with the imposition of the first post-implementation PDGM budget neutrality cuts. To emphasize, this means that three-fourths of all requests for HH agency care, most coming from hospitals for hospitalized patients, are rejected. This is very concerning and deserves examination.

In addition to overall disruptions in access to services, the data also indicate there is a disproportionate impact on historically marginalized communities. CareJourney’s analysis of Medicare fee-for-service claims data, shown below, found that these groups had a significantly lower conversion rate than white beneficiaries when referred for HH services following discharge from an acute-care hospital. The same holds true for Medicare-Medicaid dual eligibles when compared to non-dual eligible beneficiaries. This indicates that access challenges by the combination of factors discussed herein is having an inordinate impact on these communities, something that CMS should seek to address.

Source: CMS Virtual Research Data Center
Data: 2022 inpatient claim files filtered for STAC claims. Discharge data based on Q1-Q3 2022 data.
ADI: Area Deprivation Index (ADI) – from the University of Wisconsin Neighborhood Atlas Area Deprivation Index (ADI). It allows for the rankings of neighborhoods by socioeconomic disadvantage in a region of interest (https://www.neighborhoodatlas.medicine.wisc.edu/)

Further, CMS’ own data bears out how the recent economic conditions have strained access to HH services. As presented in Table B1 of the proposed rule, both the total 30-day periods of HH care and unique beneficiaries utilizing HH care was lower in CY 2022 than in CY 2020. In addition, the total visits per period of care was lower in CY 2022 than CY 2020 in every discipline other than social work, which remained flat. These figures are undoubtedly related to the difficult financial circumstances facing providers.

If addition to the growing impasse for HH services, CMS should be further troubled by the repercussions access restrictions have on acute-care hospitals. The same Careport analysis found that the average length of stay for patients discharged to HH has risen by 11% from 2019 to 2022. This is consistent with recent AHA findings of a 12.9% increase.⁷ As HH agencies lose capacity, acute-care hospitals proportionately lose their ability to discharge their patients. This, in turn, forces the acute-care hospitals to board patients who are ready for discharge, driving up costs and minimizing capacity to admit new patients. Indeed, CMS should consider adequately resourcing HH providers as a valuable tool that can be used to maximize acute-care hospital capacity and ensure the entire care continuum runs as smoothly as possible for Medicare beneficiaries.

Proposed CY 2024 HH Market Basket Update

The proposed market basket update of 2.7% (3% reduced by 0.3% productivity adjustment) for CY 2024 is inadequate to ensure Medicare beneficiaries have continued access to HH services. First, the update fails to account for missed forecasts from recent years. In addition, the proposed update continues to underappreciate the inflationary environment for health care providers. For these reasons AHA recommends CMS utilize its authority to revise the market basket upwards to meet its mission of ensuring access to HH services for traditional Medicare beneficiaries and to account for what the agency missed in the CY 2021 and CY 2022 market basket forecast. This is especially important if CMS proceeds with its plans to apply its budget neutrality adjustments as proposed.

In recent years, data indicate that the agency’s recent HH market basket updates were significantly lower than actual market basket growth. Specifically, CMS finalized updates of 2.3% and 3.1% in CYs 2021 and 2022, respectively; however, actual growth for these years were 4.2% and 6.2% respectively.⁸ This resulted in a substantial cumulative shortfall of 5.1%. Indeed, an analysis by Dobson DaVanzo & Associates, commissioned by the Partnership for Quality Home Healthcare, found that from 2021 through 2030, these forecast errors will result in nearly $11 billion in underpayments to HH agencies under the HH PPS – an astounding figure.

While final figures will not be available for several years, it is likely that the trend of under forecasting market basket cost growth has continued for CY 2023 and 2024. This is because, as AHA explained in last year’s comment letter, in atypical economic environments, the market basket approach used by CMS is much less adept at properly forecasting. And the atypical economic conditions are continuing. Specifically, as explained in the section above, health care costs, and especially labor and medical supplies, have seen historic increases which are slow to ameliorate.

The missed forecasts and inadequate proposed updates by themselves would be problematic and create serious strain on HH agencies’ ability to meet the needs of their communities. However, when combined with the budget neutrality cuts proposed by CMS, they are simply unsustainable. As CMS knows, a 2.7% update, reduced by a 5.653% budget neutrality adjustment would result in net update of -2.4% overall. Given the past forecast errors of 5.1%, the more than 8% in budget neutrality cuts already applied, and the difficult economic environment, a -2.4% update for CY 2024 could grievously disrupt access to HH services for Medicare beneficiaries.

Due to the consistent under-forecasting of the HH market basket, the unusual economic circumstances and the reductions in payment due to PDGM implementation, AHA appeals to CMS to deviate from its typical methodology and apply a more robust update to the HH market basket for CY 2024. This one-time adjustment would ensure that access to HH services is preserved for Medicare beneficiaries. Further, and of special importance to AHA, it will help ensure hospitals are not limited in their capacity to care for their communities and safely discharge patients in need of HH care.

Productivity Adjustment. CMS proposes to apply a productivity cut of -0.3% to the HH PPS market basket update. Specifically, under the Affordable Care Act, the HH payment update is reduced annually by a productivity factor, which is equal to the 10-year moving average of changes in the annual economy-wide, private nonfarm business total factor productivity (TFP). This measure was intended to ensure payments more accurately reflect the true cost of providing patient care. The use of the TFP is meant to capture gains from new technologies, economies of scale, business acumen, managerial skills and changes in production. However, as CMS knows, services provided through the HH benefit are hands-on, labor-intensive services and do not lend themselves to the productivity gains realized in other sectors. CMS itself has acknowledged that health care providers, due to the nature of their service, lack the ability to add efficiencies in the way other sectors do.⁹

Given all the various circumstances putting financial pressures on HH agencies, AHA would again like to express its concern about the application the productivity adjustment to HH agencies. AHA respectfully asks CMS to use its authority to account for the lack of parity in this adjustment when considering its overall payment adjustment to HH providers.

QUALITY REPORTING-RELATED PROPOSALS

HH Quality Reporting Program

In this rule, CMS proposes to adopt two new quality measures for the HH Quality Reporting Program (HH QRP); remove one measure and two items from the Outcome and Assessment Information Set (OASIS); and begin publicly displaying performance data on four quality measures.

Discharge Function Score Measure and Removal of Overlapping Discharge Function Measures. CMS proposes to adopt this assessment-based outcome measure that estimates the percentage of HH patients who meet or exceed an expected discharge score during the reporting period beginning with the CY 2025 HH QRP; in the FY 2024 final rules for their respective payment systems, the agency has finalized adoption of the same measure in the Inpatient Rehabilitation Facility (IRF), Skilled Nursing Facility (SNF) and Long-term Care Hospital (LTCH) QRPs. While this cross-setting discharge function score measure appears to fulfill requirements of the IMPACT Act better than the current, setting-specific self-care and mobility discharge score measures used in the various post-acute care quality reporting programs (which CMS proposes to remove in this same rule), we continue to doubt the cross-setting applicability of this measure considering the different patient populations served by the various post-acute care settings. We urge CMS to wait until this measure has undergone endorsement review by a consensus-based entity (CBE) and demonstrates that it gleans useful information for patients and providers before adopting it for use in the HH QRP.

Additionally, the measure uses information from Section GG items that appear on all four of the patient assessment instruments across the various post-acute care settings. While patients are assessed using the same or similar items, the capabilities and goals of patients differ widely by setting. The measure developer notes that the measure is risk adjusted and calculated individually by setting; then, the calculation for measure performance “rolls up” information from several items to calculate an overarching score. Risk adjustment takes many variables into account, and denominators vary by setting (for example, the denominator for the measure when calculated in the LTCH QRP includes all patients regardless of payer, while for the SNF QRP the denominator consists of patients/residents under Medicare fee-for-service).

While we appreciate the work the developer has done to attempt to consider the myriad of differences in patient populations across the various settings – including demographics, case mix, severity of illness, length of stay and comorbidities – at some point these variables alter the underlying calculation of the cross-setting measure and result in four different measures. In other words, discharge function is calculated in a way that is not truly standardized, as the IMPACT Act intended. It is at this point we ask whether it is necessary to force a measure that is “cross setting” in name only into CMS quality programs. Perhaps it is if testing of the measure demonstrates that this measure produces statistically meaningful information that can be used to inform improvements in care processes, but until we have that information from the endorsement review process by a CBE, the AHA has serious doubts about the utility of this measure.

In addition, the measure uses a statistical imputation approach to account for “missing” assessment elements when codes on the assessments note that the “activity was not attempted” (ANA). If an assessor codes an item as “not attempted,” the imputation approach inserts variables based on the values of other activities that were completed; in other words, the calculation makes assumptions about what the patient would have scored on that item if it had been attempted based on their performance on other, similar activities that were. CMS argues that this approach “increases precision and accuracy and reduces the bias in estimates of missing item values.” While we understand that scores would be influenced more heavily by individual assessment items if there are fewer included in the calculation, CMS errors in labeling items coded ANA as “missing.” When an activity is not attempted, it is likely because it would be clinical inappropriate or dangerous for a patient to attempt it; for example, it would be ill-advised (and painful) for a patient with a healing wound on one side to roll left to right. In such a case, making assumptions about the patient’s function based on other activities would, in fact, not improve the precision of the score.

We also question whether it is precise and accurate to generically apply an “expected” discharge score based on statistical regressions to unique patient populations, and whether the comparison of observed to “expected” function could wholly be attributed to the facility’s quality of care. The calculation approach for the “expected” discharge score is opaque, which makes it difficult for providers to know what they are working towards. In reality, providers strive to help each individual achieve his or her own specific goals related to function, independence and overall health. These goals are not based on statistical regressions.

The AHA understands the purpose of this measure and agrees that the discharge function measure currently in use in the HH QRP (Application of Percent of Long-term Care Hospital Patients with an Admission and Discharge Functional Assessment and a Care Plan that Addresses Function) does not meaningfully evaluate comparative performance across post-acute care settings. However, without further testing and review of the proposed Discharge Score measure by a CBE, we are not certain that this measure brings value to the QRP and thus cannot support it for adoption.

Percent of Patients/Residents who are Up to Date with COVID-19 Vaccination Measure. Beginning with the CY 2025 HH QRP, CMS proposes to adopt this assessment-based process measure that reports the percentage of stays in which HH patients are up to date with their COVID-19 vaccinations per the CDC’s latest guidance. The agency reasons that the measure would, when publicly reported, provide useful information for patients and their caregivers when choosing a facility, and “would be an indirect measure of HH agency action” since the agency would, according to CMS, have the opportunity to administer the vaccine to patients during their episode, coordinate a follow-up visit for the patient to obtain the vaccine at their physician’s office or local pharmacy, or educate the patient about the importance of staying up to date with vaccinations. CMS finalized the adoption of this measure for the SNF, LTCH and IRF QRPs in their respective FY 2024 proposed payment system final rules.

The AHA strongly supports the vaccination of health care providers and communities for COVID-19 and acknowledges the importance of up to date vaccinations. However, this measure has not been tested for validity and reliability and thus we cannot support it without knowing that it is, at minimum, feasible to report and likely to produce statistically meaningful information. Furthermore, we are not clear that the conceptual construction of the measure is the best way to encourage vaccination, especially in post-acute settings where care is delivered in episodic rather than longitudinal fashion. When reviewed by the National Quality Forum (NQF)’s Measure Applications Partnership (MAP) during the 2022-2023 review cycle, the Post-acute/Long-term Care Workgroup voted “Do Not Support” for this measure, meaning that a multi-stakeholder panel of experts representing providers, patients and payers do not support this measure for inclusion in the HH QRP as well.

Vaccination status among patients is subject to many patient-level factors outside of the control of providers. For post-acute facilities and providers, it may be infeasible or inappropriate to offer vaccination for patients due to length of episode, ability to manage side effects and medical contraindications, or other logistical challenges to gathering information from a patient who may have received care from multiple proximal providers. Even without these challenges, however, patients/residents may choose to forgo vaccination despite a provider’s best efforts. It is possible that a post-acute care provider could have a robust effort to encourage vaccination among their patients/residents, but still have a relatively low rate of vaccination. As the Health Equity subcommittee of the NQF MAP noted in its review of this measure, cultural norms often play a large role in vaccine confidence. While post-acute providers will always seek to counsel vaccination in a culturally sensitive way, they also want to honor the choice of their patients once they have offered their clinical advice.

We reiterate that we understand the importance of vaccination in protecting patients from the most serious outcomes of COVID-19. However, it is unclear whether the use of this measure will produce those results or if it is feasible for post-acute care facilities to collect and report the information necessary. The measure consists of a single yes or no item on the OASIS without any requirements for documentation or validation of vaccination status; while we acknowledge that additional documentation would be unduly burdensome for providers to collect, without it the measure is a mere checkmark in a box with no evidence that it leads to improved quality of care (since, as stated above, the measure has not been fully tested). For these reasons, we do not support the adoption of this measure in the HH QRP. CMS also may want to consider whether alternative measure constructions focused on the actions providers take in encouraging vaccination might be better suited to achieving the goal of higher vaccination rates.

HH Value-based Purchasing (VBP) Program

Replacement of OASIS-based Discharge to Community (DTC) Measure with Claims-based Version. CMS proposes to replace the measure that is currently used in the HH VBP program with a measure identical except for its data source (claims rather than OASIS assessments) and period (two years rather than one). The AHA does not oppose this proposal, as the OASIS-based measure has not been publicly reported since 2016 and thus does not appear to provide value to patients and providers. In addition, the claims-based measure is informed by two years of data, which is likely to improve the reliability of performance calculations.

Replacement of OASIS-based Function Measures with New Discharge Function Score. As we note above in our comments on CMS’ proposal to adopt this measure for the HH QRP, we have serious doubts about the utility of this measure if it were to undergo the evaluation by a CBE. We understand that CMS has already finalized the measure for adoption into the other post-acute care quality reporting programs and is thus likely to adopt it for the HH QRP as well; however, we strongly urge the agency to hold off on adopting this measure into a pay-for-performance program until we have better information about whether the measure gleans information as intended.

Replacement of Hospital Use Measures with Potentially Preventable Hospitalizations Measure. CMS currently uses two measures to assess HH patient use of hospital services during their HH episode: Acute Care Hospitalization During the First 60 Days of Home Health (ACH) and Emergency Department Use Without Hospitalization During the First 60 Days of Home Health (ED Use). In the CY 2022 HH PPS final rule, CMS replaced the ACH and ED Use measures in the HH QRP with the Potentially Preventable Hospitalizations (PPH), The PPH measure calculates a risk-adjusted rate of hospitalizations or observation stays for certain diagnoses that could have been prevented with proper management and care according to the Agency for Healthcare Research and Quality’s Prevention Quality Indicator Ambulatory Care Sensitive Conditions. CMS would remove the ACH and ED Use measures and adopt the PPH measure beginning CY 2025.

We agree that the all-cause hospital utilization measures proposed for replacement may not provide accurate assessments of provider performance or actionable information. HH providers may be unable to prevent ED visits due to factors outside of their control, including geographic factors like a lack of alternative (and lower intensity) sites of care or patient-level factors like a lack of family or community support. In addition, it is difficult to determine appropriate attribution for hospitalization between different providers and settings, especially because the current all-cause hospitalization measure does not require the reason for admission to be related to the reason the patient is receiving home health care. By removing these two measures in favor of one that is more likely to reflect whether HH agencies are providing proper management and care as well as clear discharge instructions and referrals, CMS can better assess quality of care for the purposes of the HH VBP program. Thus, we support removal of the ED Use and Hospitalization During the First 60 Days of Home Health measures.

However, when CMS proposed this replacement in the CY 2022 HH PPS rule, we voiced two concerns that we continue to urge CMS to consider regarding the PPH measure. First, the PPH measure uses the Agency for Healthcare Research & Quality’s Prevention Quality Indicators and Ambulatory Care Sensitive Conditions to inform the definition for hospitalizations that can be potentially prevented. These frameworks are not specific to post-acute care or to hospitalization, and HH care generally is not included in the definition of ambulatory care. While CMS shares its analyses that applied the conceptual definition of potentially preventable hospitalization to claims data, we encourage the agency to continue to monitor performance and hone this definition with the help of stakeholders and quality improvement experts.

Second, we recommend that CMS incorporate social determinants of health (SDOH) into its risk adjustment methodology. As proposed, the PPH measure is risk-adjusted for demographics including age, sex, enrollment status and activities of daily living scores, but not other SDOH that have a demonstrated impact on hospitalization. Several reports, including from the National Academies of Medicine, have shown that there are a number of plausible mechanisms by which sociodemographic information can be incorporated meaningfully into quality measurement. We urge CMS to incorporate social risk factors into the risk adjustment for the PPH measure and submit the measure for review by a CBE before its adoption.

We appreciate your consideration of these issues. Please contact me if you have questions or feel free to have a member of your team contact Jonathan Gold, AHA’s senior associate director for policy, at (202) 626-2368 or jgold@aha.org.

Sincerely,

/s/

Ashley Thompson Senior Vice President,
Public Policy Analysis and Development

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Hospitals’ site-neutral game plan

June 30, 2023 10:13 pm

Hospitals are on defense as Congress takes a serious look at site-neutral payments — but they’re not going to let the policy pass without a fight.

Why it matters: Hospitals are a powerful force and have a presence in congressional districts across the country. They argue they’re pushing back against cuts that would end up harming patient care.

• Advocates, however, say they are simply trying to block any reduction in their payments.

What’s happening: The American Hospital Association held a briefing for congressional staff Monday to push back against site-neutral payment proposals.

• Hospitals have also been making their case to individual offices. “We have been doing continued outreach to members of Congress, especially those on key committees of jurisdiction,” said Jason Kleinman, AHA’s senior associate director of federal relations.
• “What we’re really doing now is over the next two weeks, you know, during the recess, using this as an opportunity for our local hospital CEOs … to weigh in with members back home,” said a hospital industry source.
• “I don’t think we’re at DEFCON 1 yet, but we’re getting pretty close,” the source added.

Driving the news: The House Energy and Commerce Committee has taken the lead so far on exploring site-neutral payments, the idea of equalizing what Medicare pays for the same service between hospital outpatient departments and independent physician offices.

• Hospital sources say they are also expecting the House Ways and Means Committee to take up site-neutral payments soon.
• The Senate has been less active on this front and could be a bulwark for hospitals. At a Finance Committee hearing this month on health care consolidation, ranking member Mike Crapo touched on site-neutral payments, but Chairman Ron Wyden did not.
• Asked by Axios last week if he is open to the idea, Wyden was noncommittal. “Certainly we’re going to look at all of the issues relating to consolidation,” he said.

What they’re saying: Hospitals argue that their outpatient departments treat sicker patients and are held to higher standards than independent physician offices.

• “Site-neutral payments are cuts to Medicare,” AHA senior vice president for policy Ashley Thompson said at the congressional briefing Monday, disputing “the false belief by some that hospitals are overpaid.”
• Targeting a prevalent argument in Congress that site-neutral payments are a way to fight consolidation in health care markets, the AHA also rolled out data showing that private equity and health insurers are acquiring more physician practices than hospitals are.
• One of three hospital officials who flew in for the briefing from across the country, Carl Vaagenes, CEO of Alomere Health in rural Minnesota, said site-neutral payments would “cripple” his hospital.

The other side: An ideologically diverse array of groups, from Americans for Prosperity to Families USA, is supporting site-neutral payments. They point out the move would save money both for the government and patients, through lower premiums and cost-sharing.

• Loren Adler, a Brookings Institution health policy expert, argued at an E&C hearing in April: “Lobbyists are pretty much the only opposition.”

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Hospitals’ site-neutral game plan

June 28, 2023 10:01 am

Hospitals are on defense as Congress takes a serious look at site-neutral payments — but they’re not going to let the policy pass without a fight.

 

Why it matters: Hospitals are a powerful force and have a presence in congressional districts across the country. They argue they’re pushing back against cuts that would end up harming patient care.

 

Advocates, however, say they are simply trying to block any reduction in their payments.

What’s happening: The American Hospital Association held a briefing for congressional staff Monday to push back against site-neutral payment proposals.

 

Hospitals have also been making their case to individual offices. “We have been doing continued outreach to members of Congress, especially those on key committees of jurisdiction,” said Jason Kleinman, AHA’s senior associate director of federal relations.

 

“What we’re really doing now is over the next two weeks, you know, during the recess, using this as an opportunity for our local hospital CEOs … to weigh in with members back home,” said a hospital industry source.

 

“I don’t think we’re at DEFCON 1 yet, but we’re getting pretty close,” the source added.

 

Driving the news: The House Energy and Commerce Committee has taken the lead so far on exploring site-neutral payments, the idea of equalizing what Medicare pays for the same service between hospital outpatient departments and independent physician offices.

 

Hospital sources say they are also expecting the House Ways and Means Committee to take up site-neutral payments soon.

 

The Senate has been less active on this front and could be a bulwark for hospitals. At a Finance Committee hearing this month on health care consolidation, ranking member Mike Crapo touched on site-neutral payments, but Chairman Ron Wyden did not.

 

Asked by Axios last week if he is open to the idea, Wyden was noncommittal. “Certainly we’re going to look at all of the issues relating to consolidation,” he said.

 

What they’re saying: Hospitals argue that their outpatient departments treat sicker patients and are held to higher standards than independent physician offices.

 

“Site-neutral payments are cuts to Medicare,” AHA senior vice president for policy Ashley Thompson said at the congressional briefing Monday, disputing “the false belief by some that hospitals are overpaid.”

 

Targeting a prevalent argument in Congress that site-neutral payments are a way to fight consolidation in health care markets, the AHA also rolled out data showing that private equity and health insurers are acquiring more physician practices than hospitals are.

 

One of three hospital officials who flew in for the briefing from across the country, Carl Vaagenes, CEO of Alomere Health in rural Minnesota, said site-neutral payments would “cripple” his hospital.

 

The other side: An ideologically diverse array of groups, from Americans for Prosperity to Families USA, is supporting site-neutral payments. They point out the move would save money both for the government and patients, through lower premiums and cost-sharing.

 

Loren Adler, a Brookings Institution health policy expert, argued at an E&C hearing in April: “Lobbyists are pretty much the only opposition.”

 

 

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Senate Returns Tuesday to Move Voting Rights to Floor for Debate

January 14, 2022 7:01 am

The Senate is set to return Tuesday to debate Democrats’ election-overhaul legislation before a series of key procedural votes, but fresh opposition by Republicans and moderate Democrats to a potential rules change indicates the effort has faltered.

“The Senate will adjourn tonight,” Senate Majority Leader Chuck Schumer (D-N.Y.) said on the Senate floor last night. “However, we will be postponing recess so the Senate can vote on voting rights. We will return on Tuesday to take up the House-passed message containing voting rights.”

The first procedural vote to take up the Freedom to Vote: John R. Lewis Act (H.R. 5746) won’t occur until Tuesday at the earliest. Sen. Brian Schatz (D-Hawaii) announced yesterday he had tested positive early this week for Covid-19, temporarily sidelining him from votes. Democrats need all 50 members of their caucus present to officially take up the elections bill unless a corresponding number of Republicans are also absent.

A potential snowstorm expected to hit Washington Sunday into Monday also factored into the delay, Schumer said. The chamber now plans to recess for a state work period the week of Jan. 24.

Republicans are “ready to be on the floor talking about all of the issues” they see with the bill, including provisions related to “ballot harvesting” and photo identification requirements, Senate Republican Conference Chair John Barrasso (R-Wyo.) said in an interview.

“We also want to talk a lot about the issues that the president is ignoring,” Barrasso said.

The House yesterday passed a NASA leasing bill (H.R. 5746) amended to carry text of the Freedom to Vote Act (S. 2747) and the John R. Lewis Voting Rights Advancement Act (S. 4). That gambit allows Democrats to circumvent the first 60-vote hurdle, the motion to invoke cloture on the motion to proceed. All 50 Senate Democrats are expected to provide the votes to adopt the motion to proceed.

After Democrats officially vote to take up the bill, Schumer can file cloture and move to force a vote to limit debate. Absent unanimous consent, the cloture vote would take place two days later with a 60-vote threshold. A maximum of 30 hours of debate would follow.

The cloture vote will likely fail on a party-line vote, given unanimous Republican opposition. Schumer at that juncture could raise a point of order and challenge the ruling from the chair in order to force a vote on a yet-undecided rules change. That reinterpretation and creation of new precedent would need a simple majority to be adopted.

But that point of order is expected to fail. Shortly before President Joe Biden spoke with the Senate Democratic caucus behind closed doors yesterday, Sen. Kyrsten Sinema(D-Ariz.) confirmed in a floor speech that while she supports the voting-rights bills, she “will not support separate actions that worsen the underlying disease of division infecting our country” by weakening filibuster rules.

Sen. Joe Manchin (D-W.Va.) a few hours later also reiterated that he “will not vote to eliminate or weaken the filibuster.”

“I hope we get this done,” Biden told reporters on Capitol Hill yesterday. “The honest-to-God answer is: I don’t know if we get this done.”

House’s Role: House Democrats struck a positive note for their role advancing the voting rights measure on a party-line vote, 220-203. “The House has made clear, we stand with the people in the fight for voting rights,” Speaker Nancy Pelosi (D-Calif.) said on the floor.

Lawmakers defended their decision to focus on the legislation, despite the seeming impossibility of it passing in the Senate.

Forcing floor debate requires Republican senators to explain their opposition to the voting rights legislation, Rep. Pramila Jayapal (D-Wash.) told reporters yesterday. “If we have to go back to people and try to explain why we don’t have voting rights, it’s important they hear from Republicans themselves why they are blocking this critical legislation,” she said.

What’s Next

The Senate meets Tuesday and plans to take up H.R. 5746. Voting options, election procedures, and campaign finance rules would be modified by a House amendment to the Senate-passed bill, which would also require federal approval before voting changes can be implemented in states and localities with a recent history of discrimination.

The amendment would combine text drawn from two separate voting-focused measures: S. 2747, the “Freedom to Vote Act”; and S. 4, the “John R. Lewis Voting Rights Advancement Act”.

The House returns on Tuesday and plans a light week of work as members continue to test positive for Covid-19 and avoid the House chamber via proxy voting. Majority Leader Steny Hoyer (D-Md.) said the House will vote on legislation to automatically enroll veterans in the Veterans Affairs Department’s health care system (H.R. 4673) and a Senate-passed bill (S. 2959) that would, because of Covid-19, allow school districts to use a previous year’s data when applying for Impact Aid.

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