Weekly Health Care Policy Update – February 26, 2024

March 4, 2024

In this update: 

  • Legislative Updates
    • Congress Returns with New March Funding Deadlines Looming
    • Cassidy Releases Report on Health Data Privacy Proposals
  • Federal Agencies
    • CMS Issues Second Draft Guidance on Medicare Part D OOP Smoothing Provision
    • CMS Publishes Reports on Surprise Billing
    • CMS Publishes Final Rule on Medicaid DSH Payments
    • CMS to Hold Webinar on Innovation in Behavioral Care Model on February 29th
    • OIG Finds that Providers Mostly Met Medicare Requirements for E/M Telehealth
    • HHS OCR Delivers Two Reports to Congress on HIPAA Compliance and Breaches
    • HHS Fills ACIP Vacancies
  • Other Updates
    • GAO Says HHS Should Improve Efforts to Address Maternal Health Disparities
  • New York State Updates
    • DOH Issues Proposed Regulations for Hospitals Regarding Patients with Behavioral Health Needs
    • DFS Issues Proposed Regulations Establishing Behavioral Health Network Adequacy Standards for Commercial Insurance Plans

Legislative Update

Congress Returns with New March Funding Deadlines Looming
This week, the House and Senate return to session with new deadlines approaching to avoid a federal government shutdown. Under the current continuing resolution (CR), existing funding levels are maintained for four departments through March 1st and the remainder of the government through March 8th. Appropriations bills are likely to come to be considered in March, although legislative text has not yet been released. House Speaker Mike Johnson has indicated that another short-term CR may be considered if necessary (likely to March 22nd).

Cassidy Releases Report on Health Data Privacy Proposals
On February 21st, Senator Bill Cassidy (R-LA), the ranking member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, released a report on proposals to improve health data privacy requirements and modernize the Health Insurance Portability and Accountability Act (HIPAA). The report considers three major areas: 

  • Updates to the existing health privacy framework, such as clarifying guidance to reconcile interoperability requirements with the HIPAA standard that entities should disclose the “minimum necessary” information to fulfill requests;
  • Health data that exists in the “gray area” under HIPAA, such as intake forms, sensor data, and genetic data; and
  • Health data not covered by HIPAA, such as data on financial transactions or internet searches that may contain patient information.

A press release on the report is available here.

Federal Agencies

CMS Issues Second Draft Guidance on Medicare Part D OOP Smoothing Provision
On February 15th, the Centers for Medicare & Medicaid Services (CMS) issued additional draft guidance for the Medicare Prescription Payment Plan involving requirements for Part D plan sponsors. The guidance includes requirements for outreach and education, pharmacy processes, and operational considerations, as the program enters its first year in 2025. The Medicare Prescription Payment Plan was authorized by the Inflation Reduction Act (IRA) and allows Medicare beneficiaries to spread out the cost of prescription drugs over the year, rather than one upfront out-of-pocket expense.

The announcement is available here.

CMS Publishes Reports on Surprise Billing 
On February 15th, CMS released data on the Federal Independent Dispute Resolution Process (IDR) for the first six months of 2023. The No Surprises Act established the Federal IDR process to arbitrate out-of-network charges. CMS released the following findings: 

  • Nearly 289,000 payment disputes were initiated during the first six months of 2023.
  • Arbiters continue to work through the backlog of disputes, making nearly 84,000 payment determination in the first half of 2023, more than five times the number of determinations made in all of 2022.
  • The top three dispute initiating parties (SCP Health, Team Health, and Radiology Partners) initiated 58% of all disputes in the first half of 2023. The top 10 initiating parties submitted 78% of all disputes.
  • Providers, facilities, or air ambulance providers prevailed in 78% of payment determinations. Health insurers and health plans prevailed in 23%.
  • In 82% of disputes, the prevailing offer was higher than the median in-network rate for the disputed service.

The announcement is available here.

CMS Publishes Final Rule on Medicaid DSH Payments 
On February 20th, CMS released a final rule on Medicaid disproportionate share hospital (DSH) payments that establishes a new methodology that limits a hospital’s Medicaid shortfall to services in which Medicaid is the primary payer. CMS is required to implement such a methodology under the Consolidated Appropriations Act, 2021 (the 2020 year-end omnibus spending bill). The rule also includes modifications to hospital-specific limits on payments to conform with this methodology.

DSH payments are set to be cut by $8 billion annually during the current and next four fiscal years. Overpayments must be returned to the federal government or redistributed to other qualifying hospitals, depending on the state. Hospitals in the 97th percentile of patients that qualify for Medicare Part A as well as Supplemental Security Income (SSI) benefits may be excluded from these changes.

This rule is set to go into effect on April 27th. The rule is available here.

CMS to Hold Webinar on Innovation in Behavioral Care Model on February 29th
On February 29th, CMS will host a webinar on the Innovation in Behavioral Health (IBH) Model. This webinar will discuss the model’s framework, eligibility, payment structure, application process, and timeline.

The IBH Model, announced in January (covered by SPG here), will test a value-based payment approach for community-based behavioral health practices to integrate behavioral and physical health with health-related social needs. CMS is set to release a Notice of Funding Opportunity (NOFO) in the coming months. Up to eight states will be selected to join the model, which will launch in Fall 2024 and run for eight years.

Registration is available here.

OIG Finds that Providers Mostly Met Medicare Requirements for E/M Telehealth
On February 13th, the Department of Health and Human Services (HHS) Office of the Inspector General (OIG) released a report on telehealth services provided under Medicare flexibilities related to the Covid-19 pandemic. This is the first in a series of audits OIG intends to conduct on whether Medicare Part B services were provided appropriately.

In this audit, OIG found that providers “generally complied with Medicare requirements” in billing evaluation and management (E/M) services provided through telehealth. Of 110 sampled services, OIG found that 105 complied with all requirements, and the remaining five claims had errors resulting from clerical errors or the inability to access records.

The report is available here.

HHS OCR Delivers Two Reports to Congress on HIPAA Compliance and Breaches 
On February 14th, HHS delivered its annual reports on Health Insurance Portability and Accountability (HIPAA) compliance and health information breaches to Congress. These reports outline steps taken by the Office for Civil Rights (OCR) to investigate complaints, reports of breaches, and compliance reviews, with accompanying data. The 2022 Report to Congress on HIPAA Privacy, Security, and Breach Notification Rule Compliance included data on new complaints alleging HIPAA violations (30,435 total), the resolution of complaints (32,250 total), the resolution of complaint investigations with Resolution Agreements and Corrective Action Plans (17 total), and the completion of compliance reviews (846 total). The 2022 Report to Congress on Breaches of Unsecured Protected Health Information outlined a number of ongoing security priorities for HHS.

The announcement is available here.

HHS Fills ACIP Vacancies 
On February 15th, HHS announced the filling of eight vacancies, including the chairmanship, on the Advisory Committee on Immunization Practices (ACIP) within the Centers for Disease Control and Prevention (CDC). ACIP advises the CDC on vaccination usage and recommendations. HHS also plans to add another member to the Committee, which has 16 members at full capacity. Helen Keipp Bredenberg Talbot, of Vanderbilt University, will serve as chair.

The new members are: 

  • Edwin Asturias, Colorado School of Public Health;
  • Noel Brewer, University of North Carolina;
  • Denise Jamieson, University of Iowa Carver College of Medicine;
  • Helen Chu, University of Washington;
  • Yvonne (Bonnie) Maldonado, Stanford University;
  • George Kuchel, University of Connecticut;
  • Robert Schechter, California Department of Public Health; and
  • Albert Shaw, Yale School of Medicine.

Each new member will serve a four-year term.

Other Updates

GAO Says HHS Should Improve Efforts to Address Maternal Health Disparities
On February 21st, the Government Accountability Office (GAO) issued a report on HHS’s efforts to reduce maternal health disparities. The overall rate of maternal deaths increased significantly during the height of the Covid-19 pandemic and remains higher than pre-pandemic, while disparities among racial and ethnic minorities persisted. For example, GAO found that the maternal mortality rate for non-Hispanic Black women was about 2.5 times higher than for non-Hispanic white women.
 
GAO noted that HHS has yet to determine its metrics for achieving progress towards maternal health goals, and recommended that HHS should ensure that its 2022 Blueprint and the CDC’s Perinatal Quality collaborative programs should establish “near-term goals with quantitative targets” to help assess performance.
 
The report is available here.

New York State Updates

DOH Issues Proposed Regulations for Hospitals Regarding Patients with Behavioral Health Needs
On February 21st, the New York State (NYS) Department of Health (DOH) issued proposed regulations that would require hospital emergency departments to develop and implement policies and procedures for identification, assessment, and referral of patients with behavioral health presentations. As proposed by the Governor in her 2024 State of the State address, the regulations codify guidance issued by DOH and the NYS Office of Mental Health (OMH) in October 2023. OMH issued similar proposed regulations last month, details for which are available here.

Hospitals receiving patients with behavioral health needs would be required to develop policies and procedures regarding:   

  • Reviewing of records (e.g., PSYCKES, SHIN-NY);
  • Obtaining collateral information from friends and family members with the patient’s consent;
  • Screening for suicide and violence risk; and
  • Screening for complex needs and including a consideration of the social determinants of health when completing discharge planning for such patients.

The regulations include additional discharge planning requirements for individuals with complex needs that present at general hospitals with inpatient psychiatric units, including referring such patients to care management programs and ensuring appropriate psychiatric aftercare within seven calendar days following discharge.

The proposed regulations are available here. Public comment may be submitted to regsqna@health.ny.gov through April 22nd.

DFS Issues Proposed Regulations Establishing Behavioral Health Network Adequacy Standards for Commercial Insurance Plans 
On February 21st, the NYS Department of Financial Services (DFS) issued proposed regulations that would establish network adequacy standards for behavioral health services for regulated commercial insurance plans. The Fiscal Year 2023-24 Enacted Budget required DOH, in consultation with the DFS, OMH, and the Office of Addiction Services and Supports (OASAS) to develop regulations by the end of last year on this topic.

DOH issued identical network adequacy proposed regulations last month, which are applicable to Medicaid managed care organizations (SPG’s summary is available here).

As with the DOH proposed regulations, the DFS regulations would be effective January 1, 2025 and would require commercial insurance plans to ensure that its network has adequate capacity and availability to offer behavioral health services appointments within specified timeframes. If the plan is not able to locate a participating provider within the required timeframes, the plan must allow the member to receive services from an out-of-network provider and may not impose additional cost-sharing. The proposed regulations also include provider directory requirements, reporting requirements, and additional plan responsibilities regarding network adequacy and access.

The DFS press release is available here. The proposed regulations are available here. Public comment may be submitted to HealthRegComments@dfs.ny.gov through April 22nd.