2012 Physician Fee Schedule Final Rule Released by CMS

On November 1, 2011, the Centers for Medicare and Medicaid Services (“CMS”) released the 2012 Physician Fee Schedule Final Rule with comment period (“Final Rule”). Effective January 1, 2012, the Final Rule addresses several key components of physician reimbursement through Medicare including, to name a few, the new practice expense relative value units, changes to the adjustment of geographic practice cost indices, updates to the electronic health records incentive program, expanding the list of eligible services for telehealth services coverage, and reducing physician payments at physician wholly owned or hospital operated practices for hospital admissions occurring within 3 days of a physician service.

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2011 Uncertainty Brings Worry and Change

2010 brought significant changes in the law for the healthcare industry with the passage of the Patient Protection and Affordable Care Act (“PPACA”), the Provena decision regarding real estate tax exemption, and the Lebron case invalidating Illinois’ cap on noneconomic damages in medical malpractice cases. 2011 brought more changes in the law, new PPACA regulations, worry and uncertainty to the healthcare industry.

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CMS Releases Final ACO Regulations

Yesterday afternoon the Centers for Medicare & Medicaid Services (CMS) released the long anticipated final Accountable Care Organization (ACO) regulations, after considering the nearly 1200 comments submitted in response to the earlier proposed regulations. ACOs, created under the Affordable Care Act, are a model of health care that focuses on collaboration between providers across a continuum of care including different health care settings. The new regulations set forth the specifics for the program including payment mechanisms through which providers will be compensated for care provided through the integrated ACO model, as well as performance requirements for participating providers. The first ACOs will start operating in 2012.

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Final Antitrust Policy Statement Regarding ACOs in Medicare Shared Savings Program

On October 20, 2011, the U.S. Federal Trade Commission and the Department of Justice, which coordinate enforcement of the antitrust laws, issued their final Statement of Antitrust Enforcement Policy Regarding Accountable Care Organizations Participating in the Medicare Shared Savings Program (the “Enforcement Policy”). The fundamental principle of the Enforcement Policy is that the agencies will apply the rule-of-reason analysis to all accountable care organizations applying for or participating in the Shared Savings Program and, if the same services are involved, to commercial insurance products modeled on the Shared Savings Program.

Please read the associated Duane Morris Alert for full details.

OIG’s 2012 Work Plan For Nursing Facilities: Same Fraud, Different Enforcement

Recently, the United States Department of Health and Human Services Office of Inspector General (“OIG”) published its Work Plan for fiscal year 2012 (“Work Plan”) and delineated focus points for nursing facilities and new enforcement in 2012. The Work Plan is not much different than previous work plans with the exception of increased areas of enforcement, as well as a few new areas to be looked at by OIG.

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HHS Suspends ACA’s Class Act for Long-Term Care Insurance

Late this afternoon the Department of Health & Human Services’ (HHS)Secretary Kathleen Sebelius pulled back a long-term care insurance program, the Class Act, that was passed under last year’s Affordable Care Act. The Class Act’s goal was to create an insurance program that could cover the health care costs associated with many activities of daily living, including bathing and toileting. Speaking today, the Health & Human Services Secretary Kathleen Sebelius said that there didn’t appear to be a viable path for the Class Act, in part due to increasing concern that the program would have created substantial long-term costs.

Read Kathleen Sebelius’ full letter to Congress here.

Government Accountability Office Reports that 340B Program Needs Greater Oversight

Pursuant to a mandate in the Affordable Care Act, the Government Accountability Office (GAO) recently completed its review of the 340B Drug Pricing Program, which allows certain health care entities such as federal grantees and hospitals to receive discounted outpatient drugs. There are currently over 16,500 entities that participate in the 340B program.

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Affordable Care Act Funds Support Healthier Communities

The U.S. Department of Health & Human Services (HHS) recently rolled out its Community Transformation Grants program under the Affordable Care Act, geared towards fighting chronic disease and creating healthier communities. The five year grants will be used to address the “root causes” of chronic diseases through creating tobacco-free living, supporting active lifestyles and healthy eating, and reducing health disparities. 35 of the grantees will receive funding to implement intervention programs, and 26 grantees will receiving funding to build sustainable community prevention efforts.

Read more about the grants here.

HHS Announces Launch of Primary Care Bonus Initiative

The U.S. Department of Health & Human Services (HHS) recently announced the launch of its new Primary Care initiative to provide bonuses to primary care doctors for improvement of care coordination and cost efficiency. The goal of the initiative, created under the Affordable Care Act, is to facilitate care that is focused on the patient, coordination, and higher quality. The bonuses will be offered through commercial and state health insurance plans, and will come in the form of monthly fees above and beyond Medicare fees received for patient care. HHS has identified five primary areas that the fees will support including personalized care plans for chronically ill patients, 24-hour access to care and health information, preventive care, patient and family participation in care, and coordination among providers.

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CMS Expands Medicaid Money Follows the Person Program

The Centers for Medicaid & Medicare Services (CMS) recently expanded the Money Follows the Person grant program to provide additional assistance to state grantees’ implementation of quality improvement strategies. The Money Follows the Person program was created through the Affordable Care Act (ACA), and fifteen states received funds under the program in January 2011. Due to increases in demand from states and programs under the ACA, additional funds were needed to support the new individuals benefitting from the program including support for quality mechanisms addressing the needs of vulnerable populations. Through its recent notice, CMS announced its $1.2 million expansion of the program to be used for developing technical assistance to grantee staff and subcontractors, home and community-based services programs, CMS staff oversight, and web-based technical assistance.

Access the full notice here.

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