Weekly Health Care Policy Update – March 22, 2024

March 29, 2024

In this update: 

  • Legislative Updates
    • Congressional Leaders Unveil Legislative Text for Final FY 2024 Spending Bills
    • Bipartisan House Group Sends Letter to HHS on Change Healthcare
  • Federal Agencies
    • CMS Announces ACO Primary Care Flex Model within MSSP
    • CMS Recommends States Offer Interim Medicaid Payments to Support Providers Affected by Change Cyberattack
    • Biden Issues Executive Order on Women’s Health Research
    • CDC Releases Guide to Improving Worker Burnout
    • ASPR Issues Report on Pandemic Preparedness
  • Other Updates
    • MACPAC Releases 2024 Report to Congress
    • MedPAC Releases 2024 Report to Congress
  • New York State Updates
    • DOH Adopts Regulations Amending ADHC Services Settings Requirements
    • CMS Approves New York SPAs Implementing a 5% Rate Increase and APG Rate Parity for OASAS Services

Legislative Updates

Congressional Leaders Unveil Legislative Text for Final FY 2024 Spending Bills
On March 21st, Congressional leaders released legislative text for the six remaining fiscal year (FY) 2024 spending bills, including Labor-HHS-Education, Defense, Financial Services and General Government, Homeland Security, State-Foreign Operations, and Legislative Branch. The bill does not contain major new health care provisions. Given Friday’s midnight shutdown deadline, it is possible that another short-term continuing resolution will be necessary while the bill moves through the legislative process.
 
Bipartisan House Group Sends Letter to HHS on Change Healthcare
On March 19th, a bipartisan group of Representatives sent a letter to Department of Health and Human Services (HHS) Secretary Xavier Becerra concerning the cyberattack on Change Healthcare. While appreciative of ongoing action, the group urged HHS to use any and all authorities at their disposal to ensure the timely payment of services rendered through Parts A, B, and C of Medicare. The group also encourages HHS to support states efforts to ensure Medicaid and Children’s Health Insurance Program (CHIP) payments continue to be processed without delay. The letter explicitly notes that this is not a request for further spending or authorities, but rather a more robust utilization of existing HHS authorities in this space.
 
The letter is available here.

Federal Agencies

CMS Announces ACO Primary Care Flex Model within MSSP
On March 19th, the Centers for Medicare & Medicaid Services (CMS) announced a new voluntary model as part of the Medicare Shared Savings Program (MSSP), the ACO Primary Care (PC) Flex Model. Under ACO PC Flex, MSSP ACOs classified as low revenue will have the option to switch their primary care reimbursement to a Prospective Primary Care Payment (PPCP) system. Specifically, the PPCP system will offer the following reimbursement for primary care: 

  • A regular monthly payment, made up of two components:
    • A regional County Base Rate. This will be based on the county’s average primary care spending, rather than the historical experience of the ACO; and
    • PPCP Payment Enhancements. This component will support the provision of enhanced primary care services and will not be part of the ACO’s (i.e., this payment will not subject to recoupment).
  • A one-time up-front Advanced Shared Savings Payment of $250,000.

This system would replace existing fee-for-service (FFS) payments for primary care services for all primary care providers, federally qualified health centers (FQHCs), and Rural Health Clinics (RHCs) participating in the ACO. CMS expects that the PPCP will increase primary care funding for most MSSP ACOs.

CMS plans to release a model Request for Applications (RFA) in the second quarter of 2024. The application will be submitted alongside the regular MSSP ACO application or renewal process. ACOs will finalize participation in by the end of 2024, and the model will begin implementation in 2025. CMS intends for the model to last for five years, from 2025 through the end of 2029.

More information about the model is available here. CMS will hold a webinar for interested parties on April 4th. Registration for the webinar is available here.

CMS Recommends States Offer Interim Medicaid Payments to Support Providers Affected by Change Cyberattack
On March 15th, CMS issued a bulletin recommending that state Medicaid agencies should offer interim payments to providers affected by the Change Healthcare cyberattack. CMS will waive enforcement actions related to certain guidelines that might interfere with such payments and encourages states to submit Medicaid state plan amendments (SPAs) for additional authority as needed. Specifically, the guidance notes options to: 

  • Suspend any cost-sharing requirements in a state’s Medicaid State Plan; and
  • Provide interim FFS payments to affected providers and encourage Medicaid managed care organizations (MCOs) to do the same.

These flexibilities and the non-enforcement period will be available through June 30th.

CMS also noted that it is reopening the 2023 Merit-based Incentive Payment System (MIPS) Extreme and Uncontrollable Circumstances (EUC) Exception Application for clinicians affected, through April 15th, the end of the data submission period.

The announcement is available here.

Biden Issues Executive Order on Women’s Health Research
On March 18th, President Biden issued an Executive Order (EO) to expand research on women’s health. The stated goal of the EO is to “ensure women’s health is integrated and prioritized across the federal research portfolio and budget.” It includes four major areas: 

  • Developing and strengthening research and data standards on women’s health across research and funding opportunities;
  • Prioritizing funding for women’s health research and innovation;
  • Narrowing research gaps on diseases and conditions associated with women’s midlife health; and
  • Assessing gaps in federal funding for women’s health research.

The Administration concurrently announced a $200 million interdisciplinary research effort led by the National Institutes of Health.

The announcement is available here.

CDC Releases Guide to Improving Worker Burnout 
On March 18th, the Centers for Disease Control and Prevention’s (CDC) National Institute for Occupational Safety and Health (NIOSH) released a new guide on actions to improve health care worker wellbeing. This guide, the “Impact Wellbeing Guide: Taking Action to Improve Healthcare Worker Wellbeing,” is part of the Administration’s campaign to address burnout in the health care workforce.

The guide aims to provide a structured plan of action to help hospitals make organizational-level changes to improve the mental health of employees. The six suggested steps of the plan are to:

  1. Conduct a review of hospital operations to determine how they support professional wellbeing.
  2. Build a dedicated team to support professional wellbeing.
  3. Remove barriers to seeking care, such as intrusive mental health questions on credentialing applications.
  4. Develop a suite of communication tools that help to share updates with the workforce about the hospital’s journey to improve professional wellbeing.
  5. Integrate professional wellbeing measures into an ongoing quality improvement project.
  6. Create a 12-month plan to continue to move a hospital’s professional wellbeing work forward.

Starting in April, NIOSH will host a series of webinars for hospital leaders to discuss how to use the guide. More information is available in the press release here.

ASPR Issues Report on Pandemic Preparedness
On March 15th, the HHS Administration for Strategic Preparedness and Response (ASPR) released the Public Health Emergency Medical Countermeasure Enterprise (PHEMCE) Multiyear Budget (MYB) for FYs 2023 through 2027. PHEMCE is an interagency body responsible for providing technical expertise and making recommendations on medical countermeasure (MCM) decisions in the face of emergent public health threats. The MYB projects an estimated overall funding need of $79.5 billion over the five-year period, an increase of $15.5 billion over the last report. This funding would support efforts by the National Institutes of Health and ASPR Biomedical Advanced Research and Development Authority (BARDA).

The announcement is available here.

Other Updates

MACPAC Releases 2024 Report to Congress
On March 15th, the Medicaid and Children’s Health Insurance Program (CHIP) Payment Advisory Commission (MACPAC) released its annual March 2024 Report to Congress. The three principal areas of focus for the report were: 

  • Medical Care Advisory Committees (MCACs): The Commission made recommendations for further engaging beneficiaries in MCACs, encouraging states to incorporate diversity provisions in their bylaws.
  • Denials and Appeals within Medicaid Managed Care: The Commission examined the existing appeals process within Medicaid managed care. Identifying challenges for beneficiaries navigating this process, the Commission set forth recommendations that, if actualized, would create new federal monitoring mechanisms.
  • Disproportionate Share Hospitals (DSH): The Commission continues to report “little meaningful relationship” between state DSH allotments and the number of uninsured individuals, hospitals’ uncompensated care costs, or the number of hospitals with high levels of uncompensated care that also provide essential community services for vulnerable populations.

The report is available here.

MedPAC Releases 2024 Report to Congress
On March 15th, the Medicare Payment Advisory Commission (MedPAC) issued its annual March 2024 Report to Congress. The report examined: 

  • Hospital Inpatient and Outpatient Services: The Commission recommended that Congress update the 2024 Medicare base payment rate for acute care hospitals by the statutory amount plus 1.5%.
  • Physician and Other Health Professional Services: The Commission notes that payments to physicians are adequate based on MedPAC’s indicators, but recommended a safety-net add-on payment under the Physician Fee Schedule.
  • Outpatient Dialysis Services: The Commission concluded that Medicare’s end-stage renal disease payments are adequate.
  • Skilled Nursing Facilities (SNFs): The Commission recommends a 3% base payment rate reduction for SNFs, noting that their analysis shows that beneficiary access will remain adequate despite this proposed reduction.
  • Home Health Care Services: The Commission recommends a 7% base payment rate reduction for home health care services.
  • MA Programs: The Commission notes a lack of clear, quality information during the MA plan selection process, and highlights the uncertain value of supplemental benefits. As a result, the Commission recommends reducing payments to plans. The report reiterates previous concerns with MA plans including onerous utilization management tools and small networks.
  • Part D Programs: The Commission noted that satisfaction with the program among beneficiaries remains relatively high, despite rising prices. The report explored provisions from the Inflation Reduction Act (IRA) and expressed concerns with pharmacy benefit managers (PBMs).
  • DSH: The Commission recommends that Congress begin redistributing disproportionate-share hospital and uncompensated care payments through the Medicare Safety-Net Index (MSNI), and to add $4 billion to the MSNI pool.

The report is available here.

New York State Updates

DOH Adopts Regulations Amending ADHC Services Settings Requirements
On March 20th, the New York State (NYS) Department of Health (DOH) adopted final regulations that aim to ensure compliance among Adult Day Health Care (ADHC) services with the CMS Home and Community-Based Services (HCBS) Final Rule. Although most ADHC services are associated with a nursing home, ADHC services may also be provided in non-residential settings. The new regulations require that for such services: 

  • The setting should be selected by the individual from among setting options, including non-disability specific options;
  • The setting options must be identified and documented in the person-centered plan and based on the individual’s needs and preferences;
  • The setting should ensure an individual’s rights of privacy, dignity, and respect, and freedom from coercion and restraint; and
  • The setting should optimize, not regiment, individual initiative, autonomy, and independence in making life choices, including but not limited to daily activities, physical environment, and with whom to interact.  

The final regulations are available here.

CMS Approves New York SPAs Implementing a 5% Rate Increase and APG Rate Parity for OASAS Services
On March 19th, CMS approved New York’s SPA to provide a 5 percent Medicaid rate increase for the following Office of Addiction Services and Supports (OASAS): 

  • Freestanding outpatient addiction rehabilitation;
  • Freestanding outpatient addiction day rehabilitation;
  • Freestanding opioid treatment;
  • Freestanding inpatient rehabilitation;
  • Freestanding medically supervised inpatient withdrawal and stabilization; and
  • Part 820 residential services (including stabilization, rehabilitation, and reintegration).

The SPA is available here. The CMS approval letter is available here.

CMS also approved New York’s SPA to provide Ambulatory Patient Group (APG) rate parity across all OASAS freestanding outpatient settings, so that all program types within a rate-setting region (upstate or downstate) share the same APG base rate.

The SPA is available here. The CMS approval letter is available here.