Congress Passes Legislation Delaying 25 Percent Medicare Physician Reimbursement Cut for One Year

On December 15, 2010, President Obama signed the Medicare and Medicaid Extenders Act of 2010 into law. This legislation implements a one-year delay to a significant reduction in reimbursement—a 25 percent pay cut—for physicians treating Medicare beneficiaries. Current Medicare payment rates will now remain in effect through December 31, 2011. In addition, the Act extends other Medicare and Medicaid payment provisions that were set to expire, such as the Medicare work geographic adjustment floor, Transitional Medical Assistance, and the qualifying individual program. Among other things, the Act also repeals the delay of RUG-IV and provides for the continued inclusion of orphan drugs as covered drugs for children’s hospitals under 340B.

The full text of the Act is available at

OIG Submits Semiannual Report to Congress Reporting Savings and Expected Recoveries of $25.9 Billion

On December 15, 2010, the OIG submitted its semiannual report to Congress pursuant to the Inspector General Act of 1978. The report summarizes the OIG’s audit, investigation, and evaluation activities from April 1, 2010 through September 30, 2010 and for the 2010 fiscal year in total. Highlighted accomplishments for FY 2010 include savings and expected recoveries of $25.9 billion and the exclusion of 3,340 individuals and organizations from participation in Federal health care programs. The report summarizes the OIG’s Medicaid and Medicare reviews, its legal and investigative activities, its public health (CDC, FDA, HRSA, HIS, NIH) and human services (AoA, ACF) reviews, and other department wide issues.

To read the OIG’s press release, please go to: To read the full report, please go to:

HHS Releases “Strategic Framework on Multiple Chronic Conditions”

On December 14, 2010, the U.S Department of Health and Human Services (“HHS”) released its “Strategic Framework on Multiple Chronic Conditions” (the “Framework”). HHS describes the Framework as an “innovative private-public sector collaboration to coordinate responses to a growing challenge.” It was developed by a departmental workgroup with most of HHS’ operating divisions participating. HHS has identified four goals of the Framework, including (1) improving the health of individuals with multiple chronic conditions through system changes; (2) increasing the use of self-care management; (3) providing more information and better tools to help health professionals caring for individuals with multiple chronic conditions; and (4) facilitating research on interventions and systems that will benefit those with multiple chronic conditions. Going forward, HHS will coordinate the Framework and will solicit input from agencies within HHS and stakeholders from the private sector.

To learn more about the Framework, please go to:

New Medicare Primary Care Incentive Payment Program

On December 3, 2010, the Centers for Medicare and Medicare Services (CMS) announced its implementation of a primary care incentive payment program, which is scheduled to take effect in 2011. Under the Patient Protection and Affordable Care Act (PPACA), Medicare is authorized to offer this incentive to primary care practitioners for the services they provide under Part B, beginning January 1, 2011, and until January 1, 2016. According to section 5501(a) of the PPACA, Medicare will pay primary care practitioners “on a monthly or quarterly basis an amount equal to 10 percent of the payment amount” for such primary care services under Part B. This program is one example of the numerous incentives for primary care practitioners that will continue to be implemented under the authority of the PPACA.

For more information regarding this announcement, please go to: and

New Legislation Delays Medicare Physician Reimbursement Cut for an Additional Month

On November 30, 2010, President Barack Obama signed into law the Physician Payment and Therapy Relief Act of 2010. This legislation implements a one-month delay to a significant reduction in reimbursement—a 23-percent pay cut—for physicians treating Medicare beneficiaries. The legislation also provides a 2.2-percent reimbursement increase for physicians. The reimbursement reduction will go into effect, beginning on December 31, 2010. Both the Obama administration and Congress hope to use this delay to develop a long-term solution.

For more information regarding the Physician Payment and Therapy Relief Act of 2010, please go to:

CMS Introduces New Center for Medicare and Medicaid Innovation

On November 16, 2010, the Centers for Medicare and Medicaid Services (CMS) announced the establishment of the Center for Medicare and Medicaid Innovation (CMMI), under the Patient Protection and Affordable Care Act (PPACA). The acting director of the Center is Richard Gilfillan, M.D., the former president and CEO of Geisinger Health Plan and executive vice president of insurance operations for Geisinger Health System. The goal of the CMMI is to improve quality of care and make coverage more affordable for Medicaid and Medicare patients. To do this, the CMMI will collaborate with key stakeholders, which include consumers, patient advocates, physicians, hospitals, federal agencies and states. The Center will focus on three main objectives:

Continue reading “CMS Introduces New Center for Medicare and Medicaid Innovation”

Amendment to the Interim Final Rules for Group Health Plans and Health Insurance Coverage Relating to Status as a Grandfathered Health Plan Under the PPACA

This regulation, issued on November 15, 2010, amends an earlier regulation published in June that outlined rules governing whether group health plans and health insurance coverage in both the individual and group markets can maintain “grandfathered” health plan status. The grandfathered status allows plans to retain an exemption from some new requirements under the Patient Protection and Affordable Care Act. Under the amended regulation, a group health plan may now switch insurance companies and maintain its grandfathered plan status as long as it adheres to other requirements outlined in this and the original regulation. This amendment affords employers more flexibility in shopping for health plans that offer coverage at a lower cost. Additional information regarding this provision is available at:

New Regulation Outlining Changes to Medicare Program

This regulation, issued on November 24, 2010, outlines several changes to the Medicare program regarding the following: (1) the hospital outpatient prospective payment system, (2) the ambulatory surgical center payment system, (3) payments to hospitals for graduate medical education (GME) costs and indirect medical education (IME) costs, (4) rules governing physician self-referrals and related provider agreements in hospitals where physicians have investment interests or in hospitals owned by physicians, and (4) payments for certified registered nurse anesthetist services in rural and critical access areas. Changes to the hospital and ambulatory surgical centers payments systems will be to the amounts and factors used to determine payment rates. For both GME and IME hospital payments this regulation implements new provisions under the Patient Protection and Affordable Care Act. With respect to physician self-referrals, this regulation introduces new limitations. And as to anesthesia services there will be changes to the effective date of when hospitals can begin receiving reasonable cost payments for these services.

New Affordable Care Act Grants to Help Put Patients in Control of Their Healthcare

The U.S. Department of Health and Human Services (HHS) today announced new Consumer Assistance Grants program awards of nearly $30 million to help states and territories put patients in charge of their health care. These grants will support states’ efforts to establish or strengthen consumer assistance programs that provide direct services to consumers with questions or concerns regarding their health insurance.