CMS will temporarily hold claims while we wait for Congress to address SGR Issue and health reform update

The Senate was unable to pass legislation to block the scheduled 21% Medicare cut to physicians scheduled for Monday, March 1st. Earlier in the week, Senate Majority Leader Harry Reid (D-NV) attempted, unsuccessfully, to procure unanimous consent (UC) from the Senate on a bill that would extend current Medicare rates for 30 days among other healthcare provisions. The 30-day extension plan was part of a two-step approach that involved two legislative measures: a smaller measure, which included a 30-day extension in SGR-imposed cuts and unemployment benefits, as well as COBRA insurance programs; and a larger, more comprehensive measure that would delay the cuts through the end of the year along with a more comprehensive set of health-related and tax "extenders." Reid's plan was blocked by Senator Jim Bunning (R-KY), over objections that the healthcare-related "extenders" in the measure were not offset, or paid for. The House passed the 30-day extension bill on February 24th.

Senate Democrats will, reportedly, try again next week by taking up a longer-term (year long) extension package, which is expected to include most of what Senate Democrats were unable to pass in the 30-day extenders package. The bill is not expected to clear the floor until the latter part of next week at the earliest.

CMS instructed Medicare contractors to hold claims for the first 10 days of March pending further developments on the payment cuts. Prior to the announcement, there were a number of anecdotal reports that physicians had planned to hold claims, reschedule Medicare patients or stop seeing Medicare patients altogether until the payments are restored. Under current regulations, physicians can hold claims up to 14 days before submission. What all this means is that we have a 2 week buffer before claim payment is reduced and physician practices begin to feel this devastating cut in payment. We need to all work to keep the pressure on all members of Congress to address this now.

While debate continues following the "health summit" last week, we can not let these core issues such as SGR and other Medicare extenders impact patient access to care.
The white house summit ended with the President making it clear that he intends to move forward with reform legislation with or without the Republicans within the next 4 to 6 weeks. The process to do so will either be a scaled-down plan ("skinny plan") or Democrats could use the process of reconciliation that would likely be modeled on the President's proposed outline which is based on some modifications to the Senate bill.

Key components of that proposal include the following:

• Insurance Exchange: Sets up 50 insurance marketplaces administered by the states, in which small businesses and people without employer coverage could buy insurance that meets new federal standards; establishes a new federal authority that would address insurance premium hikes.
• Individual Mandate: Individuals must purchase insurance or pay a penalty that would be the greater of $695 or 2.5% of income by 2016.
• Employer Responsibility: Does not include an employer mandate, but requires companies with 50 or more employees to help defray the cost if taxpayers are paying for their worker's insurance. Also penalizes companies with 50 or more employees that don't provide coverage, but exempts the first 30 workers when calculating the tax. Companies that don't offer insurance would be charged $2,000 annually per employee.
• Medicaid Expansion: Expands Medicaid to cover everyone earning less than 133% of the FPL ($29,327) for a family of 4. Increases the federal share of covering new eligible beneficiaries, and proposes to simplify several eligibility rules for the current program. The proposal also seeks a middle path between the House and Senate bill's subsidies for low-income Americans.
• Closes the Medicare Part B Doughnut Hole: Closes the doughnut hole by 2020 by increasing the amount of money provided for rebates to beneficiaries and by reducing co-insurance payments.
• Pathway for Follow-on Biologics: The proposal includes very little detail, but includes establishing "a new pathway to create generic versions of biological products." The proposal does not include data exclusivity terms.
• Financing: Combination of Medicare cuts, new taxes and increased industry fees. The proposal includes a tax on high-cost insurance (or "Cadillac" health plans), but pushes it up to $27,500 for family plans and $10,200 for individual plans, up from $23,000 and $8,500, respectively, compared to the Senate bill. It extends the 2.9 percent Medicare payroll tax into unearned income for couples earning more than $250,000. It also Increases the pharmaceutical industry fees to $33 billion (up from the $23 billion in the Senate bill), and builds on Medicare cuts included in the House and Senate bills.

Rumors have begun to emerge that a scaled-down measure is being prepared by Democratic lawmakers should they lack the votes needed to pass reform legislation through the reconciliation process.

Health Reform -- "Side car" Reconciliation if Bipartisan Effort Fails? Doc Fix issue still looms...

White House and Democratic congressional leaders were, reportedly, imminently close to completing a detailed health care proposal designed to win passage without Republican support if President Barack Obama's summit next week fails to produce bipartisan compromises.

During a press conference yesterday, HHS Secretary Kathleen Sebelius said Democratic negotiators are reconciling final differences in House and Senate health bills that passed last year. The White House plans to post the proposals online early next week (perhaps on Monday February 22), ahead of the February 25 summit announced earlier this month.

In other news reports filed by the Associated Press this week, another White House official, who spoke anonymously, made comments suggesting the White House and Congress' Democratic leaders could fall back to the reconciliation process to enact comprehensive health reform if Republican leaders don't support compromises that could draw enough lawmakers from both parties to create a bipartisan majority. According to those reports, the goal of this week's negotiations is to develop a reconciled measure that Senate Democrats can pass, under rules barring Republican filibusters, unless Republicans offer acceptable changes at next week's summit.


The House does not have enough votes to pass the Senate-passed reform bill, HR 3590, without changes to the measure's financing proposals. Under the parliamentary procedure known as reconciliation, the House would pass the Senate bill and the Senate would immediately amend the measure through a "side car" reconciliation bill. The contents of such a proposal have been tightly held and there is no clarity but it is expected to modify the Senate Bill just enough to garner the necessary votes on the House side.

While broader reform continues to swirl -- we have a March 1 deadline to prevent a dramatic 21% cut in Medicare Physician Reimbursement due to SGR (known as the "Doc Fix") that still has not been addressed. This issue will remain central to next week's activities.

Medicare "Doc Fix" issue Looms as Senator Reid Narrows the Bipartisan Jobs Bill

In a surprise announcement this afternoon, Senator Reid has narrowed the proposed Baucus & Grassley bipartisan jobs bill to focus it on jobs related issues. The problem is that some of the components added were critical "extenders" to Medicare that are needed to address critical issues including the 21% Medicare pay cut for physicians on March 1st. This issue must be addressed now.

Link to article announcing the change in course http://su.pr/2Zf3zj

Congress and Health Reform Update: Will Jobs Bill Help Address Urgent Issues Such as Doc Fix?

Congress is reportedly still weighing health reform options, including reconciliation based on reports this week. While health care reform legislation has clearly stalled since State Senator Brown (R-MA) won the special U.S. Senate race in Massachusetts last month, congressional leaders are, reportedly, continuing to ponder options for passing comprehensive reform legislation. House leaders said this week they will take their cues from the Senate before determining their strategy for advancing comprehensive reform legislation.

After a budget hearing this week, Senate Finance Committee Chair Max Baucus (D-MT) reportedly told Congressional Quarterly that the Senate is continuing to consider moving health care reform through the reconciliation process. Under that scenario, the Senate reform bill would be approved by the House and simultaneously amended via "sidecar reconciliation bill" introduced in the Senate. Congressional leaders in both chambers, since the special MA election, continue to say reconciliation is the best chance for passing a comprehensive reform bill. This approach has the support of the White House, but it does not have broad support from members of Congress.

Given the current stalemate on moving comprehensive reform legislation, House and Senate leaders are preparing to move forward with stand-alone votes for smaller-scale reform provisions. The House is preparing to advance a repeal of anti-trust exemption for health insurers, medical loss ratio rules and banning health plan rescissions. The Senate is considering a six-month extension of increased federal funding for Medicaid (FMAP) as part of its jobs creation bill. The White House continues to push for enactment of comprehensive healthcare reform this year despite the President's economic agenda having taken first priority. The President's FY 2011 Budget Proposal, released February 1, assumes $150 billion deficit reduction resulting from passage of health care reform.

So what's next?? Indeed it is not clear what, when or how health reform might move forward. We all recognize that there are issues that must be addressed quickly including the Medicare SGR Physician Reimbursement issue (or "Doc Fix"). Rumors today are that Congress might address this issue (for at least a year or perhaps as a 5-year fix) as part of a jobs-related bill.