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  • Final and Interim Rule Ensures Access to Affordable Coverage Under Medicaid and CHIP

    A final and interim rule issued today by the Centers for Medicare and Medicaid Services (CMS) updates regulations to include the new Medicaid coverage groups created by the Affordable Care Act (ACA), simplifies eligibility policy for Medicaid and the Children's Health Insurance Program (CHIP), streamlines the eligibility and enrollment processes, and coordinates eligibility procedures with those of the Affordable Insurance Exchanges (Exchanges).

    Beginning in 2014 when Exchanges begin operation, Medicaid coverage will be extended to all individuals between ages 19 and 64 with incomes up to 133% of the federal poverty level, or $14,856 for an individual and $30,656 for a family of 4. This group is termed those "newly eligible" for Medicaid. Children will remain eligible for either Medicaid or CHIP at higher income levels based on the eligibility standards already in effect in their state. New federal matching rates will provide 100% federal funding for newly eligible individuals for 3 years (calendar years 2014-2016), gradually reduced to 90% in 2020, where it remains permanently.

    As outlined in a rule released earlier this week, Exchanges must offer essential health benefits (EHB), which include the category of "rehabilitative/habilitative services," to beneficiaries. The "newly eligible" group of Medicaid beneficiaries must receive benefits that include EHBs; however, details of this will be addressed in future rulemaking. 

    The rule provides 2 ways for Exchanges to perform Medicaid-eligibility evaluations: (1) the Exchange can determine Medicaid eligibility based on the state's Medicaid eligibility rules and also determine eligibility for advance payment of premium tax credits; or (2) the Exchange can make a preliminary Medicaid eligibility assessment and rely on the state Medicaid and CHIP agencies for a final eligibility determination.

    The rule also simplifies financial eligibility by relying on a single "Modified Adjusted Gross Income" (MAGI) standard for determining eligibility for most Medicaid and CHIP enrollees and by consolidating eligibility categories into 4 main groups—adults, children, parents, and pregnant women. People eligible under the new MAGI-based category will be promptly enrolled in Medicaid.

    In response to public comments, the rule clarifies that people with disabilities or in need of long term services and supports may enroll in an existing Medicaid eligibility category to ensure that they are quickly enrolled in coverage that best meets their needs.

    CMS issued several provision of this rule on an interim final basis and, therefore, is seeking stakeholder input on them. These include safeguarding information on applicants and beneficiaries, timeliness and performance standards for Medicaid, timeliness standards for CHIP, and coordinated eligibility and enrollment among insurance affordability programs. APTA will review this rule and post a summary to its Web site in the near future. The association also will submit comments on the interim rules as necessary.

    CMS Delays Enforcement of Version 5010 for Additional 3 Months

    The Centers for Medicare and Medicaid Services' (CMS) Office of E-Health Standards and Services (OESS) has delayed the enforcement of HIPAA Version 5010 through June 30 for covered entities that are required to comply with the updated transactions standards.

    The new standards went into effect January 1. However, in November 2011, OESS announced it would delay enforcement until the end of March to allow covered entities to complete outstanding implementation activities, including software installation, testing, and training. Although covered entities have been making steady progress, OESS has extended its enforcement discretion period for an additional 3 months.  

    During this additional delay, OESS is stepping up its existing outreach to include more technical assistance for covered entities. It also is partnering with industry groups and the Medicare fee-for-service (FFS) program and Medicaid to expand technical assistance opportunities and eliminate remaining barriers. 

    The Medicare FFS program will continue to host separate provider calls to address outstanding issues related to Medicare programs and systems. Medicare Administrative Contractors will continue to work closely with clearinghouses, billing vendors, or health care providers requiring assistance in submitting and receiving Version 5010 compliant transactions. 

    Last month, APTA launched a new Web page that contains resources to help physical therapists transition to HIPAA Version 5010. In addition to implementation information, the association has designed an online complaint form for members who are having issues transitioning to the new standards. After the form is completed and submitted online, APTA will forward the issue to CMS.

    MedPAC Makes Recommendations to Increase Efficiency of Medicare

    Yesterday, the Medicare Payment Advisory Commission (MedPAC) made several payment recommendations that could affect physical therapists in private practices and those working in skilled nursing facilities (SNF) and for home health agencies (HHA).   

    In its March report, MedPAC calls on Congress to repeal the sustainable growth rate and replace it with a 10-year path of statutory fee-schedule updates. This path comprises a freeze in current payment levels for primary care and, for all other services, annual payment reductions of 5.9% for 3 years, followed by a freeze. Under the 10-year update, the Department of Health and Human Services (HHS) should increase the shared savings opportunity for physicians and other providers who join or lead 2-sided-risk accountable care organizations.

    The commission also recommends that HHS regularly collect data—including service volume and work time—from a cohort of efficient practices to establish more accurate work and practice expense values. The initial round of data collection should be completed within 3 years.

    Additionally, the report addresses the need to identify overpriced fee-schedule services and reduce their relative value units accordingly.

    In the SNF setting, MedPAC suggests that Congress eliminate the market basket update for 2013 and revise the prospective payment system (PPS). Specifically, MedPAC calls for raising SNF Medicare Part A payments for medically complex care and lowering SNF Medicare Part A payments for high-intensity therapy, with the goal of making payments more equitable across facilities. Rebasing payments should begin in 2014, with an initial reduction of 4% and subsequent reductions over an appropriate transition until Medicare's payments are better aligned with providers' costs.

    In addition, the commission proposes reducing payments to SNFs with relatively high risk-adjusted rates of rehospitalization during Medicare-covered stays to counter the financial incentive that SNFs and hospitals have to rehospitalize beneficiaries.

    To help address fraud and abuse in home health care, MedPAC calls on HHS and the Office of the Inspector General to conduct medical review activities in counties that have aberrant home health utilization. Additionally, the report urges HHS to suspend payment and the enrollment of new providers if they indicate significant fraud.

    Recommendations for HHA payment include a 2-year rebasing of home health rates in 2013 and eliminating the market basket update for 2012. Additionally, the home health case-mix system should be revised to rely on patient characteristics to set payment for therapy and nontherapy services and should no longer use the number of therapy visits as a payment factor. MedPAC also suggests establishing a per episode copay for home health episodes that are not preceded by hospitalization or post-acute care use.

    These recommendations will be considered by Congress and the Centers for Medicare and Medicaid Services for implementation into current Medicare policies. APTA will continue to work with MedPAC and the federal government to ensure that implementation is conducted in a manner that ensures access to high-quality physical therapy services and avoids undue administrative burden on providers.