IV drip in a hospital hallway

The president releases a budget that includes new bonus payments for hospitals and CMS and insurance companies agree on new quality measures

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At the agencies

The Centers for Medicare and Medicaid Services (CMS), along with other private insurance groups, have agreed on new quality measures in an effort to consolidate the hundreds of different and sometimes conflicting measures providers must report. This agreement, the “Core Measures Collaborative,” distinguishes seven sets of core quality measures that address primary care, accountable care organizations, and specialties such as obstetrics and gynecology. Some of these new measures include the tracking and reporting of cervical cancer screenings performed by OB-GYNs and hospital mortality rates for cardiology.

CMS will implement the new quality measures through the rulemaking process and many will occur in conjunction with the implementation of the rules regarding the Merit-based Incentive Payment System program. Private insurers, however, plan to begin immediate implementation of the quality measures during upcoming contract negations with providers. The private-public working group will next meet to evaluate quality measures in pediatric care and overall patient experience.

On February 8, CMS posted a notice to their website regarding the agency’s plan to test new payment methodologies for Medicare Part B drugs. The agency has since reported that this posting was premature and has pulled the posting from their website. It had already been seen and noticed by numerous stakeholders in the healthcare space and revealed some specifics on the plans that CMS has for the new payment model testing. According to the notice, CMS will be exploring different add-on percentage amounts to study how these might affect spending and prescribing rates and will be using different formulas for different zip codes to determine how these methodologies differ in different locations nationwide. CMS has not revealed when it will “officially” repost the notice.

On February 11, CMS released a final rule regarding the so-called “60 day rule,” created by the Affordable Care Act. This final rule eases some of the overpayment burden for providers that the proposed rule, released in February 2012, had included. Providers had voiced concern that the proposed rule did not specify when the 60-day period began. To rectify these concerns and ease the burden on providers who must return Medicare payments, the final rule reduces the standard of “identification” of overpayments to account for the various compliance programs employed by different providers. The rule also allows providers up to six months to identify possible errors in some cases, and expands the ways in which providers can return overpayments to include processes like claims adjustment and credit balance reporting. The final rule also reduces how far back providers must look for overpayment claims from 10 years to 6. 

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At the White House

On February 9, President Obama released his newest and last budget proposal, and it includes new bonus payments to hospitals. The unspecified bonuses would be for hospitals that work with or through qualifying “alternative payment modes” which may include accountable care organizations and bundled payment initiates. The president’s budget, however, did not provide details on which models would qualify hospitals for these bonuses. The intent of these bonuses is to increase participation in alternative payment models with the goal of coupling 30% of Medicare payments with the new models by the end of 2016. Funding for the bonuses outlined in the budget would be paid by reducing inpatient and outpatient payment to all providers. The bonus payment proposal in the budget is similar to the bonus payments included in the Sustainable Growth Rate (SGR) repeal legislation passed last year.  

For more information on this topic, or to learn how Baker Tilly healthcare specialists can help, contact our team.

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