This WSC Brief gives an overview of the flurry of activity surrounding telehealth during the closing months of 2020.
The budget reconciliation process is a powerful tool that allows lawmakers to advance spending and tax policies through the Senate with a simple majority.
Used in the past to advance major tax cuts and enact portions of the Affordable Care Act, Democrats may use reconciliation in 2021 to achieve their policy priorities and deliver President-elect Joe Biden legislative wins if they pull out victories in both Senate runoff elections in Georgia.
Still, there are key limitations that prevent it from being used on any type of legislation — and leaders would have to obtain sufficient support within their own ranks, including a narrow House majority and a 50-50 Senate where Vice President-elect Kamala Harris would break a tie.
The term “reconciliation bill” describes legislation that would change spending and/or tax laws to meet the targets set by a congressional budget resolution. There can be more than one bill depending on the instructions in the budget resolution.
Only a simple majority is required for passage in the Senate. If everyone shows up, that means 51 votes. Debate limits (see below) mean the measures can’t be filibustered, and proponents don’t need the 60-vote supermajority that applies to most legislation under the chamber’s cloture rules.
Reconciliation has been used to pass some sweeping measures, including:
Budget resolutions can include instructions to committees to report reconciliation legislation, often with a deadline, to meet spending and revenue targets.
The resolutions are internal blueprints that guide congressional deliberations of tax and spending policies and aren’t sent to the president. But both chambers must adopt the same budget resolution to set up the process.
The reconciliation instructions also can require reporting of debt-ceiling legislation, which can come in handy because the measure can also be passed with a simple majority.
If more than one committee receives instructions, then the individual committees first send their recommendations to the House and Senate Budget committees, which consolidate the proposals. If a single committee receives instructions (for example, just the House Ways and Means Committee on a revenue measure), its recommendation can be sent directly for a floor vote.
In 2017, with Republican control of both chambers and Donald Trump newly in the White House, there were two rounds of reconciliation.
The first, conducted under a fiscal 2017 budget resolution adopted early in the session, set up action on a bill to make changes to the Affordable Care Act. While the House passed a measure, the Senate didn’t, and the effort stalled.
The second round, under the fiscal 2018 budget resolution, set the stage for the tax package enacted at the end of 2017.
In the Senate, debate is limited to 20 hours, eliminating the possibility of a filibuster.
Not counted against that maximum: the minutes or hours spent offering and voting on amendments and motions. That typically results in a “vote-a-rama” with members on the floor holding back-to-back votes for hours.
The House typically adopts a rule limiting floor debate and specifying which amendments are made in order.
Under the Senate’s Byrd Rule, named after the late Sen. Robert Byrd (D-W.Va.), provisions in reconciliation bills are supposed to be budgetary in nature—affecting revenue or spending. The Senate parliamentarian provides advice on whether provisions comply.
If a provision doesn’t produce a change in outlays or revenue, it’s subject to a point of order. It takes 60 votes to waive the point of order and keep the language in the measure. The rule can lead to the trimming of things such as the details of provisions in the bills, reporting requirements, and even official short titles — as in 2017 when the “Tax Cuts and Jobs Act” was deleted from the GOP tax plan.
The rule applies to provisions in conference reports on budget reconciliation bills, which reflect compromises reached by House and Senate negotiators. If the House has adopted the conference report before the Senate deletes language as a result of the Byrd rule, then representatives have to vote again on the revised text.
The Byrd Rule also prevents reconciliation from being used to make changes to Social Security.
Reconciliation was last used in 2017, also the last year both chambers adopted a traditional budget resolution. Adoption of resolutions has become much less frequent over the years, especially when there’s a divided Congress.
Budget enforcement has instead largely been through legislation that also adjusted spending caps under the Budget Control Act. For example, the two-year budget deal enacted in 2019 (Public Law 116-37) included budget enforcement provisions for fiscal 2020 and 2021.
The spending caps only ran through fiscal 2021, so there could be renewed interest in using budget resolutions to set top-line spending measures and for reconciliation purposes.
Hospitals started the year with new requirements to post information they had long sought to obscure: the actual prices negotiated with insurers and the discounts they offer their cash-paying customers.
The change is part of a larger push by the Trump administration to use transparency to curtail prices and create better-informed consumers. Yet there is disagreement on whether it will do so.
As of Jan. 1, facilities must publicly post on their websites prices for every service, drug and supply they provide. Next year, under a separate rule, health insurers must take similar steps. A related effort to force drugmakers to list their prices in advertisements was struck down by the courts.
With the new hospital rule, consumers should be able to see the tremendous variation in prices for the exact same care among hospitals and get an estimate of what they will be charged for care — before they seek it.
The new data requirements go well beyond the previous rule of requiring hospitals to post their “chargemasters,” hospital-generated list prices that bear little relation to what it costs a hospital to provide care and that few consumers or insurers actually pay.
Instead, under the new rule, “these are the real prices in health care,” said Cynthia Fisher, founder and chairman of Patient Rights Advocate, a group that promotes price transparency.
Each hospital must post publicly online, in a machine-readable format easy to process by computers, several prices for every item and service they provide: gross charges; the actual, and most likely far lower, prices they’ve negotiated with insurers, including de-identified minimum and maximum negotiated charges; and the cash price they offer patients who are uninsured or not using their insurance.
In addition, each hospital must make available, in a “consumer-friendly format,” the specific costs for 300 common and “shoppable” services, such as delivering a baby, getting a joint replacement or having a hernia repair.
The data for those 300 services must total all costs involved — including hardware, operating room time, drugs given and fees of hospital-employed physicians — so patients won’t face the nearly impossible job of figuring it out themselves.
Hospitals can mostly select which services fall into this category, although the federal government has dictated 70 that must be listed, including certain surgeries, diagnostic tests, imaging scans, new patient visits and psychotherapy sessions.
No. At best, these are ballpark figures.
Other factors influence consumers’ costs, like the type of insurance plan a patient has, the size and remaining amount of their annual deductible and the complexity of the medical problem.
An estimate on a surgery, for example, might prove inexact. Complications could arise, adding to the cost.
“You’ll get the average price, but you are not average,” said Gerard Anderson, a professor of health policy and management at Johns Hopkins Bloomberg School of Public Health.
Tools to help consumers determine in advance the amount of deductible they’ll owe are already available from many insurers. Experts say the information becoming available this month will prompt entrepreneurs to create apps or services to help consumers analyze prices. For now, though, the hospital requirements are a worthy start, say experts.
“It’s very good news for consumers,” said George Nation, a Lehigh University professor of law and business. “Individuals will be able to get price information, although how much they are going to use it will remain to be seen.”
Zack Cooper, a Yale University associate professor of public health and economics, doubts that the data alone will make much of a difference for most consumers.
“It’s not likely that my neighbor — or me, for that matter — will go on and look at prices and, therefore, dramatically change decisions about where to get care,” he said.
Some cost information is already made available by insurers, particularly out-of-pocket costs for elective services, “but most people don’t consult it,” he added.
That could be because many consumers carry types of insurance in which they pay flat-dollar copayments for such things as doctor visits, drugs or hospital stays that have no correlation to the underlying charges.
Still, the information may be of great interest to the uninsured and the increasing number of Americans with high-deductible plans, in which they are responsible for hundreds or even thousands of dollars in costs annually.
For them, the negotiated rate and cash discount information may prove useful, said Nation.
“If I have a $10,000 deductible plan and it’s December and I’m not close to meeting that, I may go to a hospital and try to get the cash price,” Nation said.
Employers may have a keen interest in the new data, said James Gelfand, senior vice president at the ERISA Industry Committee, which lobbies on behalf of large employers. They’ll want to know how much they pay each hospital compared with others and how well their insurers stack up in negotiating rates, he said.
For some employers, he said, it could be eye-opening to learn how hospitals cross-subsidize by charging exorbitant amounts for some things and minimal amounts for others.
“The rule puts that all into the light,” Gelfand said. “When an employer sees these ridiculous prices, for the first time they will have the ability to say no.” That could mean rejecting specific prices or the hospital entirely, cutting it out of the employer plan’s insurance network. But, typically, employers won’t limit workers’ choices by outright cutting a hospital from a network.
More likely, they may create financial incentives to use the lowest-cost facilities, said Anderson.
“If I’m an employer, I’ll look at three hospitals in my area and say, ‘I’ll pay the price for the lowest one. If you want to go to one of the other two, you can pay the difference,’” Anderson said.
Revealing actual negotiated prices may push more-expensive hospitals in an area to reduce prices in future bargaining talks with insurers or employers, potentially lowering health spending.
It could also go the other way, with lower-cost hospitals demanding a raise, driving up spending.
Bottom line: Price transparency can help, but the market power of the players might matter more.
In some places, where there may be one dominant hospital, even employers “who know they are getting ripped off” may not feel they can cut out a big, brand-name facility from their networks, said Anderson.
The hospital industry went to court, arguing that the rule unfairly forces hospitals to disclose trade secrets and violates their First Amendment rights. That information, the industry said, can be used against them in negotiations with insurers and employers.
The U.S. District Court for the District of Columbia disagreed with the hospitals and upheld the rule, prompting an appeal by the industry. On Dec. 29, the U.S. Court of Appeals for the District of Columbia affirmed that lower court decision and did not block the rule.
In a written statement, the American Hospital Association cited “disappointment” with the ruling.
The AHA plans to talk with the Biden administration “to try to persuade them there are some elements to this rule and the insurer rule that are tricky,” said Tom Nickels, an AHA executive vice president. “We want to be of help to consumers, but is it really in people’s best interest to provide privately negotiated rates?”
Fisher thinks so: “Hospitals are fighting this because they want to keep their negotiated deals with insurers secret,” she said. “What these rules do is give the American consumer the power of being informed.”
The change is part of a Trump administration push to curtail costs and create better-informed consumers through transparency.
Protecting Americans from surprise medical bills without inflating insurance costs will be a pivotal first-year challenge for the Biden administration, industry observers say.
The federal government will next year create a sweeping system to halt instances where insured individuals get unexpectedly expensive medical bills and to settle pricing disputes between doctors and insurers through arbitration. President Donald Trump signed the surprise billing legislation into law as part of the omnibus spending and virus aid package (H.R. 133).
Biden’s health and labor agencies face difficult decisions that will determine how effective that system will be and whether health-care providers or insurance companies can tip the scales in their favor. Groups that have spent years lobbying Congress on surprise billing say they’re keeping a close eye on these choices to gauge whether more legislation is needed.
“This new law hinges on what happens in regulation,” Mark Miller, executive vice president of health care for Arnold Ventures, a philanthropy that funds research and advocacy for center-left organizations, said.
President-elect Joe Biden has already promised big changes for the health insurance industry in 2021: he’s vowed to increase Obamacare’s insurance subsidies and roll back many of the changes Trump made to Obamacare’s individual insurance marketplaces.
These issues are likely to come up in the confirmation hearings for Biden’s choice to lead the Health and Human Services Department, Xavier Becerra, two congressional aides for senators who serve on the confirming committees said.
There are several areas of the law where regulators will have to make key decisions that could shift billions of dollars each year toward doctors or insurers.
Under the new arbitration system, providers and insurers would submit an offer to an independent entity that chooses the final payment amount based on median in-network rates, among other factors. It couldn’t consider Medicare rates, which typically pay less than private insurance, or a provider’s billed charges, which tend to be higher.
The creation of this system is expected to be the focus of intense industry lobbying.
“There’s going to be a lot of pressure to do this as quickly as possible and rely on industry guidance,” Kevin Lucia, a research professor at Georgetown University, said.
If the arbiter more often agrees with health-care providers who are seeking higher payments for their services then health-care spending overall will rise, costing insurers and the government more, Lucia said.
Matt Eyles, president and chief executive officer of America’s Health Insurance Plans, the insurance industry’s main lobbying arm, said in a recent statement that his group is “deeply concerned that hardworking American families and businesses will face increased costs and higher premiums as private-equity firms exploit arbitration processes.”
However, the law has guardrails to keep providers from abusing the arbitration system, such as a cooling off period, Loren Adler, associate director of the USC-Brookings Schaeffer Initiative for Health Policy, said.
Starting in 2022, the law bans surprise billing for emergency medical services, for ancillary services such as anesthesia, for other care without a patient’s consent, and for air ambulance services.
The incoming Biden administration will have to spell out what regulators consider consent and how patients will be informed that they’re waiving protections against a surprise bill for planned services, Jack Hoadley, a research professor at Georgetown University who studies insurance law, said.
“I think there is room to try to do that in a way that makes it truly informed consent, but it’s something they’ll have to grapple with,” he said. “You don’t want it to get lost with all the other forms to sign.”
Advocacy organizations say they’ll be watching how the Biden administration implements the surprise billing law.
“From the perspective of Arnold Ventures we’re going to be watching,” Miller said. “If it goes in a bad direction we’re going to keep it in the public eye.”
Hospital executives are planning for how they can sustain telehealth momentum from the COVID-19 pandemic and build the practice into their future care delivery strategies.
Patient visits conducted via video or phone could account for between 10% to 30% of total visits after the COVID-19 pandemic subsides, according to healthcare executives and analysts. But to achieve that, hospitals will need to fine-tune the patient experience, improve training and trouble-shooting resources for clinicians, and figure out payment challenges.
“The technology part of this is sophisticated, but the really hard part is the human factors,” said Dr. Arthur Southam, executive vice president of health plan operations and chief growth officer at Oakland, Calif.-based Kaiser Permanente. “How do you make the telehealth experience—the waiting room, and the start, and the finish—a really good consumer and clinician experience?”
Even before the pandemic, Kaiser had a relatively large telehealth presence, with about 15% of scheduled outpatient visits conducted virtually.
That figure shot up to 80% in the early spring; it has since settled at around 50%. Kaiser obtains much of its revenue from its prepaid membership model, Southam said, which helped weather the pandemic as the organization doesn’t rely on fee-for-service payments and procedure volumes as heavily as other health systems do.
“We’re very bullish on the potential for digital and telehealth services to complement what we do in person-to-person services,” Southam said.
In the future, he expects 40% to 50% of Kaiser’s outpatient visits to be completed via telehealth.
Nationwide, telehealth visits accounted for nearly 20% of physician visits in early December—down from 50% in April, but still significantly higher than the less than 1% adoption seen before the pandemic, according to an analysis the Chartis Group and Kythera Labs published based on claims data from commercial payers and Medicare Advantage health plans.
The 20% figure is also trending up from early fall 2020—when telehealth utilization had seemingly plateaued at around 15% of total visits.
On a weekly basis, MedStar Health in Columbia, Md., has been conducting between 10,000 to 12,000 of its scheduled visits directly to patients at home via telehealth, a stark increase from the fewer than 100 visits delivered that way cumulatively in the first few weeks of 2020, before the onset of COVID-19 in March.
“Where (telehealth utilization) settles out is still an open question,” said Dr. Ethan Booker, medical director of the MedStar Telehealth Innovation Center and MedStar eVisit. “I don’t think it’s going to go back to the pre-pandemic levels … patients have come to expect the convenience and accessibility of it.”
Forty-one percent of U.S. patients indicated they would prefer to use telehealth to meet with at least one of their providers after the pandemic, according to a report from the Healthcare Information and Management Systems Society. Seventy-seven percent said they would be willing to use telehealth.
And roughly one-third of patients who received remote care during the COVID-19 pandemic said they expect to seek care digitally again in the future, according to report from market research firm Forrester.
In the report, Forrester predicted that virtual care will surpass 440 million visits in 2021, down from 2020, which is on track to hit 481 million visits.
“At this point, virtual care is table stakes—it’s no longer a way of offering competitive advantage,” said Arielle Trzcinski, a senior analyst at Forrester who co-authored the report.
Not just a tech projectHealth systems trying to differentiate their telehealth offerings will have to work on improving the patient experience during a telehealth visit, rather than just the basics of setting up a virtual care service, Trzcinski said.
That could include working to reduce the time patients have to spend navigating a patient portal, downloading a separate app, or staring at a blank screen in a virtual waiting room before their visit, as well as consolidating telehealth programs across service lines so patients know what to expect organization-wide.
There’s an “opportunity to reimagine that (patient) experience,” Trzcinski said. “What could this experience look like? What should it look like?”
Patient experience is an area St. Louis-based Ascension is working to streamline, according to Dr. Joe Cacchione, the system’s executive vice president of clinical and network services.
There are a few ways patients can access video visits today, such as through Ascension’s mobile app, but Cacchione said Ascension is working to roll out a program that would send patients a message with a hyperlink before an appointment, which they would press for one-click access to their virtual visit.
“We’ve got to make it simple for the patients,” Cacchione said. “Too many clicks, log-ins, passwords—those things aren’t going to work long-term.”
About 10% to 20% of all patient visits at Ascension are being conducted through telehealth today, depending on the market.
In the six months before March 2020, Ascension had conducted roughly 5,000 to 6,000 telehealth visits in total—a “fraction of a percent” of the system’s overall visits, Cacchione said.
In the short term, Cacchione expects the proportion of visits conducted via telehealth at the system to “settle out” at around 10%. But he envisions that figure could grow over time, particularly for follow-up visits for specialty and primary care, as patients continue to become more familiar with the technology and as “we make it more efficient to have a virtual visit.”
And patients aren’t the only end-users on a telehealth visit. Health system executives need to ensure clinicians have a user-friendly experience during the encounter, too.
Before the pandemic, Renton, Wash.-based Providence had already established a team of coding, engineering and nursing staff to help train and field questions from clinicians interested in adding telehealth services. That internal consulting service became crucial in the wake of COVID-19 as a place for clinicians to reach out with questions about billing, technology and workflow.
Telehealth is “way more complicated than just, ‘Hey, we’ll FaceTime and do a video visit,’ ” said Dr. Todd Czartoski, chief medical technology officer at Providence.
The health system completed 70,000 video visits in 2019, most of which were connecting to people at other healthcare facilities for specialty care. In mid-April of 2020, that jumped to roughly 70,000 video visits per week, many of which involved clinics connecting directly to a patient at their home amid stay-at-home orders.
About 20% of clinic visits at Providence are still being completed through telehealth.
Czartoski said he’s not sure what proportion of visits will remain virtual after the pandemic. “It’s going to depend on regulatory and payment structures,” he said. “If CMS stops allowing home visits with the lifting of the public health emergency, the visit numbers will drop.”
Getting paidHealth systems in fee-for-service payment models are largely reliant on decisions from private and public payers for whether—and how much—they will be reimbursed for care delivered via telehealth.
Medicare, for the most part, doesn’t reimburse for telehealth services that patients receive at home.
While some insurers waived fees and restrictions on telehealth because of COVID-19, they haven’t committed to doing so after the pandemic subsides.
Many health system executives hope that will change. At the same time, they note that the industry’s movement toward value-based care and at-risk contracts could also support telehealth reimbursement.
“We’ll continue to make investments in the infrastructure for being successful delivering telehealth,” such as working to more closely integrate telehealth with the electronic health record system, said MedStar’s Booker. “We fully expect the reimbursement environment will continue to shift.”
Some patients expect telehealth to cost less than in-person care, too. Forty-nine percent of patients said they would expect out-of-pocket expenses for a video visit with their established provider to cost less than an in-person visit, while 37% said they expected it to cost the same, according to the report from HIMSS.
A virtual visit tends to generate between two-thirds to three-quarters of the revenue of the comparative in-person visit, according to Ascension’s Cacchione. It’s not that they get paid less for the same tasks, he explained, but “oftentimes, we’ll do an (electrocardiogram) in the office, we’ll do a blood draw—there will be some other code that’s billed for.”
To account for that, hospitals will have to retool processes to ensure they capture patients following up on-site after a virtual visit, as well as ensure that information is sent back to the ordering physician.
“It’s just going to be part of the normal workflow going forward as we see more and more people virtually,” Cacchione said.
Even if telehealth accounts for less revenue than in-person visits, it’s going to be necessary for most health systems to have virtual care in place and build it into their business model. As more patients expect to see telehealth as an option, they may start seeking out virtual care at other organizations in lieu of in-person care with their current provider and may even choose to leave health systems that don’t regularly offer video visits.
Health system executives working to build out sustainable telehealth programs need to ensure there’s “clear, quantifiable return on investment,” considering money spent alongside money saved, improved patient outcomes and possible new patients drawn in by the virtual care offering, said Tom Kiesau, leader of the digital transformation unit at the Chartis Group.
Providers “see consumers wanting (telehealth),” Kiesau added. “If they don’t provide it, someone else will.”
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Since its publication last year, the rule has been at the center of a legal battle brought on by the several industry groups and hospitals that argue the disclosure of private payer rates would violate their First Amendment rights and potentially lead to more provider consolidation. Recently, however, a federal judge dismissed the case, paving the way for the rule’s implementation at the start of the new year. The case is currently under appeal.
Enacted in 1973, the Rehabilitation Act is a federal anti-discrimination law that affects federal and federally funded programs in their treatment of individuals with disabilities. Initially, the Rehabilitation Act focused on equal employment practices, reasonable accommodations, and federally subsidized programming for people with disabilities. After over 40 years of being enacted, interpretations of the Rehabilitation Act are changing due to the emergence and development of the internet.
In July 2019, President Trump announced the Advancing American Kidney Health (AAKH) initiative to transform the way the nation prevents and treats kidney disease in the U.S. The AAKH initiative focuses on specific strategies to guide U.S. Department of Health and Human Services (HHS) actions to achieve three goals:
• Goal 1: Reduce the Risk of Kidney Failure
• Goal 2: Improve Access to and Quality of Person-Centered Treatment Options
• Goal 3: Increase Access to Kidney Transplants
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On March 9, 2020, the Office of the National Coordinator for Health IT (ONC) and the Centers for Medicare and Medicaid Services (CMS) finalized rules to prevent information-blocking practices and anti-competitive behaviors by healthcare providers, developers of certified health IT products, health information exchanges and other information networks. It also specifies the reasonable and necessary activities that do not constitute information blocking.
Covered actors must comply with the information blocking requirement nine months after the publication of the Final Rule; however, due to the COVID-19 pandemic, enforcement will not begin until November 1, 2020.
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House Democrats on May 12, 2020 unveiled their latest round of legislation to provide Americans with economic relief from the coronavirus pandemic. The bill, entitled the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, would add an additional $175 billion to the Public Health and Social Services Emergency Fund, including $100 billion for the Provider Relief Fund.
On September 14, 2018, the Office of Management and Budget (OMB) issued OMB Bulletin No. 18-04, which superseded the April 10, 2018 OMB Bulletin No. 18-03. These bulletins established revised delineations for Metropolitan Statistical Areas, Micropolitan Statistical Areas, and Combined Statistical Areas (collectively known as Core Based Statistical Areas, or CBSAs), and provided guidance on the use of the delineations of these statistical areas.
On April 14, 2020, the Centers for Medicare and Medicaid Services (CMS) announced that it will use this bulletin as the basis for new CBSAs when determining the area wage index (AWI) adjustments for health care facilities like skilled nursing facilities (SNFs) and acute care hospitals.
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