Rural Hospitals

Federal Update

John T Supplitt

Senior Director AHA Section for

Small or Rural Hospitals

Mid-South CAH Conference

Agenda

1 Regulatory Policy

2 Fiscal Flashpoints

3 Advocacy Agenda

4 Legal Resources

Regulatory

Policy

OMB Bulletin No 13-01

Office of Management and Budget Bulletin No 13-01 (Who is Rural)

Revised delineations establish new CBSAs urban counties that

would become rural rural counties that would become urban and

existing CBSAs that would be split apart In summary there are

34 New Micropolitan Statistical Areas

55 Deleted Micropolitan Statistical Areas

27 Micropolitan Statistical Areas now Metropolitan Statistical Areas

3 Metropolitan Statistical Areas now Micropolitan Statistical Areas

Agenda

1 Regulatory Policy

2 Fiscal Flashpoints

3 Advocacy Agenda

4 Legal Resources

Regulatory

Policy

OMB Bulletin No 13-01

Office of Management and Budget Bulletin No 13-01 (Who is Rural)

Revised delineations establish new CBSAs urban counties that

would become rural rural counties that would become urban and

existing CBSAs that would be split apart In summary there are

34 New Micropolitan Statistical Areas

55 Deleted Micropolitan Statistical Areas

27 Micropolitan Statistical Areas now Metropolitan Statistical Areas

3 Metropolitan Statistical Areas now Micropolitan Statistical Areas

Regulatory

Policy

OMB Bulletin No 13-01

Office of Management and Budget Bulletin No 13-01 (Who is Rural)

Revised delineations establish new CBSAs urban counties that

would become rural rural counties that would become urban and

existing CBSAs that would be split apart In summary there are

34 New Micropolitan Statistical Areas

55 Deleted Micropolitan Statistical Areas

27 Micropolitan Statistical Areas now Metropolitan Statistical Areas

3 Metropolitan Statistical Areas now Micropolitan Statistical Areas

OMB Bulletin No 13-01

Office of Management and Budget Bulletin No 13-01 (Who is Rural)

Revised delineations establish new CBSAs urban counties that

would become rural rural counties that would become urban and

existing CBSAs that would be split apart In summary there are

34 New Micropolitan Statistical Areas

55 Deleted Micropolitan Statistical Areas

27 Micropolitan Statistical Areas now Metropolitan Statistical Areas

3 Metropolitan Statistical Areas now Micropolitan Statistical Areas

Program Efficiency Transparency and

Burden Reduction

Conditions of Participation

Conditions for Coverage bull Removes a regulation requiring that a hospitalrsquos governing

board include a member of the medical staff

bull Allows qualified dieticians to order patient diets

bull Allows CMS-approved accrediting organizations to assess

compliance with ldquoswing bedrdquo requirement (CAH already eligible)

bull Removes a requirement that CAHs consult with a non-staff

member in developing patient care policies

bull Eliminates requirement for CAHs RHCs and FQHCs that a

physician must be on site at least once in every two-week period

bull Allows long-term care facilities to apply for a deadline extension

for automatic sprinkler system installation requirements

DEPARTMENT OF HEALTH

AND HUMAN SERVICES

Centers for Medicare amp

Medicaid Services

42 CFR Parts 411 412 416

419 422 423 and 424

[CMS-1613-P]

RIN 0938-AS15

Medicare and Medicaid

Programs Hospital

Outpatient Prospective

Payment and

Ambulatory Surgical

Center Payment Systems

and Quality Reporting

Programs

OPPS Proposed Rule

Provisions in the proposed rule include bull Outpatient Department fee schedule

increase factor of 21

bull Increasing payments to SCHs by 71 percent

for all services paid under the OPPS

bull Making a single packaged payment for

ancillary services when they support a

primary service

bull Addition of one measure to outpatient

quality reporting requirements and removal

of three others

bull Collecting data on site-of-service for off-

campus provider-based departments

bull Changes to data requirements for rural

physician-owned hospitals

bull Revision of the requirements for physician

certification of hospital inpatient admissions

IPPS Final Rule

FY 2015 INPATIENT HOSPITAL PPS

FINAL RULE

Note This update does not include hospital-specific payment changes due to

readmissions VBP HACs MU etc

IPPS Final Rule CMS will continue working with stakeholders to address

how to improve payment policy for short inpatient

hospital stays

Finalizes change to the physician certification

requirement associated with 96-hour condition of

payment for CAHs CAHs will now have until one day

before the date on which the claim for payment is

submitted to complete all requirements

Clarifies funding of GME for rural hospitals and urban

partners that are now classified as urban in the revised

CBSAs

Finalizes MDHLow Volume Adjustments for the period

Oct 1 2014 through March 31 2015

IPPS Final Rule CMS will continue working with stakeholders to address

how to improve payment policy for short inpatient

hospital stays

Finalizes change to the physician certification

requirement associated with 96-hour condition of

payment for CAHs CAHs will now have until one day

before the date on which the claim for payment is

submitted to complete all requirements

Clarifies funding of GME for rural hospitals and urban

partners that are now classified as urban in the revised

CBSAs

Finalizes MDHLow Volume Adjustments for the period

Oct 1 2014 through March 31 2015

Price Transparency bull ACA requires each hospital to establish

update and make public a list of its standard

charges for items and services it provides

bull ldquoRemindsrdquo hospitals of this obligation

bull Post publicly or be in response to inquiry

bull Must be updated annually

bull The AHA has developed tools and resources

to assist hospitals in making this information

available to patients

IPPS Final Rule FY15

Direct Supervision of HOTS

CMSrsquo June 5 Statement on HOP Panel

Recommendations

Next Meeting Aug 25-26

Accepted Direct to General

bull G0176 Activity therapy

bull 36593 Declotting by thrombolytic

agent

bull 36600 Arterial puncture withdrawal

of blood for diagnosis

bull 94667 Manipulation chest wall initial

demonstration andor evaluation

bull 94668 Manipulation chest wall

subsequent

Extended Duration to General

bull 96370 Subcutaneous infusion for

therapy or prophylaxi

Direct to Extended Duration

bull 36430 Transfusion blood or blood

components

Remaining Extended Duration

bull 96369 71 Subcutaneous infusion for

therapy or prophylaxis

Not Accepted Direct to General

bull 96401-2 Chemotherapy

administration

bull 96409 11 Chemotherapy

intravenous push techniques

bull 96413 15 16 17 Chemotherapy

intravenous infusion techniques

bull 97597 Debridement open wound

Outpatient Therapy Caps

bull ATRA subjects CAHs to the therapy cap beginning

Jan 1 2014

bull Pathway for SGR Reform Act of 2013

ndash Therapy cap exceptions process extended

ndash Temporary application of the therapy cap to

hospital outpatient departments

1

SUBJECT Applying the Therapy Caps to CAHs

Physician Fee Schedule

bull Transitions the Ambulance Fee

Schedule to the new OMB CBSA

and RUCA delineations for the

purpose of payment calculations

bull Adds several codes to the

telehealth list

ndash Psychotherapy services

ndash Prolonged service office and

ndash Annual wellness visit bull Removes employment requirements for services

furnished incident to RHC and FQHC visits

effectively allowing them to contract rather than

employ non-practitioner staff

Meaningful Use of EHRs

CMS Proposed Rule Meeting meaningful use in 2014

bull Rule released May 20

bull Recognizes that delays in certification have created a

timeline challenge for providers

bull Win Greater flexibility in 2014 would allow more

hospitals and physicians to both receive incentives in

2014 and avoid future Medicare payment penalties

bull More to do Address Stage 2 challenges in 2015

340B Orphan Drug Lawsuit

1 HRSA Issues Orphan

Drug Final Rule ndash July

2013

2 PhRMA Sues HRSA ndash

Sept 2013

3 AHA supports HRSA in

amicus brief ndash Dec 2013

4 US Federal Court Decided in Favor of

PhRMA ndash May 23 2014

5 HRSA will continue to allow purchase of

orphan drugs through the 340B program

Fiscal Flashpoints December 31 2014

bull Medicaid physician ldquocliffrdquo

April 1 2015

bull Medicare physician ldquocliffrdquo

Debt Ceiling 2015

Options for offsets and deficit reduction bull Prospective coding offsets ($8 billion)

bull Site neutral payment policies EampM codeHOPD ($10 billion)

66 additional APCs procedures ($9 billion)

12 procedures performed in ASCs ($6 billion)

bull Hospital bad-debt reductions ($20 billion)

bull GME reductions ($10 billion)

bull CAH payment reductions and qualification criteria

($2 billion)

bull Post acute care ($70 billion)

bull IPAB expansion ($41+ billion)

bull Medicaid State provider assessments ($22 billion)

Medicaid DSH ldquorebasingrdquo

Hospital Vulnerability List

Deficit Reduction Alternatives include bull Reduce Medicare costs by changing cost-sharing

structures for Parts A and B (means testing)

bull Reform Medigap

bull Combine Medicare Parts A and B

bull Increase the eligibility age for Medicare

bull Enact medical liability reform

bull Develop programs to coordinate care for individuals

eligible for both Medicare and Medicaid

bull Eliminate barriers to integrated care models

bull Modernize the Medicaid long-term care benefit

Alternatives and Solutions

Options for offsets and deficit reduction bull Prospective coding offsets ($8 billion)

bull Site neutral payment policies EampM codeHOPD ($10 billion)

66 additional APCs procedures ($9 billion)

12 procedures performed in ASCs ($6 billion)

bull Hospital bad-debt reductions ($20 billion)

bull GME reductions ($10 billion)

bull CAH payment reductions and qualification criteria

($2 billion)

bull Post acute care ($70 billion)

bull IPAB expansion ($41+ billion)

bull Medicaid State provider assessments ($22 billion)

Medicaid DSH ldquorebasingrdquo

Hospital Vulnerability List

Deficit Reduction Alternatives include bull Reduce Medicare costs by changing cost-sharing

structures for Parts A and B (means testing)

bull Reform Medigap

bull Combine Medicare Parts A and B

bull Increase the eligibility age for Medicare

bull Enact medical liability reform

bull Develop programs to coordinate care for individuals

eligible for both Medicare and Medicaid

bull Eliminate barriers to integrated care models

bull Modernize the Medicaid long-term care benefit

Alternatives and Solutions

Deficit Reduction Alternatives include bull Reduce Medicare costs by changing cost-sharing

structures for Parts A and B (means testing)

bull Reform Medigap

bull Combine Medicare Parts A and B

bull Increase the eligibility age for Medicare

bull Enact medical liability reform

bull Develop programs to coordinate care for individuals

eligible for both Medicare and Medicaid

bull Eliminate barriers to integrated care models

bull Modernize the Medicaid long-term care benefit

Alternatives and Solutions

Advocacy Agenda

Payment bull Prevents 24

percent

reduction in

Medicare

payments to

physicians

(+158)

bull Nothing from our

list

bull Reserve fund (-23)

bull VBP for nursing

homes (-20)

bull Diagnostic and

imaging quality

program (-2)

bull Valuation of services

in Medicare

physician fee

schedule (-44)

bull ERSD PPS revisions

(-18)

bull Clinical labs (-25)

bull Extends Medicaid

DSH cuts into FY

2024 (-44)

bull Realigns Medicare

sequester at 4

percent for first 6

months of FY

2024 and zero

percent for

second six

months (-49)

Policy bull Medicare

extenders (+36)

bull Medicaid DSH

cut delay

bull Two midnight

delay

bull One year delay

of ICD-10

Protecting Access to Medicare Act

Payment bull Prevents 24

percent

reduction in

Medicare

payments to

physicians

(+158)

bull Nothing from our

list

bull Reserve fund (-23)

bull VBP for nursing

homes (-20)

bull Diagnostic and

imaging quality

program (-2)

bull Valuation of services

in Medicare

physician fee

schedule (-44)

bull ERSD PPS revisions

(-18)

bull Clinical labs (-25)

bull Extends Medicaid

DSH cuts into FY

2024 (-44)

bull Realigns Medicare

sequester at 4

percent for first 6

months of FY

2024 and zero

percent for

second six

months (-49)

Policy bull Medicare

extenders (+36)

bull Medicaid DSH

cut delay

bull Two midnight

delay

bull One year delay

of ICD-10

Protecting Access to Medicare Act

Protecting Access to Medicare Act

delaying the start of the Medicaid DSH cuts for one year

extending delay in the CMS 2-midnight policy through March 31 2015

delaying implementation of the ICD-10 coding system

extending the work GPCI floor

extending the therapy cap exceptions process

Whatrsquos missing from PAMA includes

eliminating the 96-hour physician certification requirement

suspending the direct supervision of HOTS

relieving hospitals from cuts to Medicare DSH permanently

establishing beneficiary equity in hospital readmissions

fixing RAC permanently

permanent fixes for Medicare extenders

PAMA contains important hospital-related provisions

extending MDH LVA and ambulance add-on

payments

Medicare Audit Improvement Act HR

1250S 1012

Two-Midnight Rule Coordination and

Improvement Act (S 2082)

Two Midnight Rule Delay Act of 2013

(HR 3698)

DSH Reduction Relief Act of 2013 (HR

1920S 1555)

Establishing Beneficiary Equity in the

Hospital Readmission Program Act of

2014 (HR 4188)

Advocacy Action

Offers care from a civilian health care provider at the

departmentrsquos expense to any veteran enrolled in the

VA health system who cannot get an appointment

within the departmentrsquos current wait-time goal (14

days) or who lives more than 40 miles from a VA

medical facility

Veterans Access Choice and

Accountability Act

Advocacy Action

Rural Hospital

Advocacy Agenda

Rural Hospital and Provider Equity

(R-HoPE) Act Sens Tom Harkin (D-IA) John Barasso (R-WY)

Pat Roberts (R-KS) and Al Franken (D-MN)

Rural Advocacy Agenda

Provisions

ndash Extend the outpatient hold harmless

ndash Extend and increase the low-volume adjustment

ndash Extend cost-based payment for rural outpatient labs

ndash Extend CAH rural ambulance payments

ndash Extend the billing for the technical component

of pathology services

ndash Reimburse CAHs for CRNA on-call services

ndash Address 96 hour condition of payment

ndash Implement enforcement delay of direct supervision

Rural Hospital and Provider Equity

(R-HoPE) Act Sens Tom Harkin (D-IA) John Barasso (R-WY)

Pat Roberts (R-KS) and Al Franken (D-MN)

Rural Advocacy Agenda

Provisions

ndash Extend the outpatient hold harmless

ndash Extend and increase the low-volume adjustment

ndash Extend cost-based payment for rural outpatient labs

ndash Extend CAH rural ambulance payments

ndash Extend the billing for the technical component

of pathology services

ndash Reimburse CAHs for CRNA on-call services

ndash Address 96 hour condition of payment

ndash Implement enforcement delay of direct supervision

The Protecting Access to Rural

Therapy Services Act

Would protect access to outpatient

therapeutic services by adopting a

default standard of ldquogeneral

supervisionrdquo

Rural Advocacy Agenda

Would provide for the extension of

the enforcement instruction on

supervision requirements for

outpatient therapeutic services in

critical access and small rural

hospitals through 2014

Critical Access Hospital Relief Act

AHA is working with concerned lawmakers to

pass legislation that would remove the 96-

hour piece of the physician certification

requirement as a condition of payment

Rural Advocacy Agenda

Critical Access Flexibility Act

Would give CAHs needed flexibility to accommodate

fluctuations in patients through the option of

meeting an average annual daily census of 20

Rural Advocacy Agenda

Improving Medicare Post-Acute Care

Transformation Act of 2014

The IMPACT Act would require LTCHs inpatient rehabilitation

facilities SNFs and home health agencies to report

standardized patient assessment data and quality and

resource use measures

The IMPACT Act would not require hospitals to report patient

assessment data

Hospitals would use PAC quality measure data are used to

inform the discharge planning process

Rural Advocacy Agenda

Legal Actions

AHA Litigation

AHA Legal Actions in

Process 1 CMS hospital rebilling policy

2 The two-midnight rule

bull unlawful arbitrary standards and

documentation requirements

bull 02 percent cut to FY 2014 IPPS

payments

3 Statutory deadlines for timely

review of Medicare claims denials

4 Federal court decision that will

exclude all drugs with an orphan

designation from the 340B Drug

Pricing Program

AHA Litigation

AHA Legal Actions in

Process 1 CMS hospital rebilling policy

2 The two-midnight rule

bull unlawful arbitrary standards and

documentation requirements

bull 02 percent cut to FY 2014 IPPS

payments

3 Statutory deadlines for timely

review of Medicare claims denials

4 Federal court decision that will

exclude all drugs with an orphan

designation from the 340B Drug

Pricing Program

Shirley Ann Munroe Award

Resources

John Supplitt

Sr Director

AHA Section for

Small or Rural

Hospitals

312-422-3306

jsupplittahaorg

Contact Information