House Republicans Release ACA Alternative

On Monday, March 2, the chairmen of the three health-related committees in the House of Representatives, Reps. Paul Ryan (R-WI), Fred Upton (R-MI) and John Kline (R-MN), outlined an Affordable Care Act (“ACA”) alternative for states that opt out of running a federal exchange. The proposal, which was published in a Wall Street Journal op-ed, would introduce fundamental changes to the structure of the ACA ahead of this week’s King v. Burwell oral arguments before the Supreme Court. The Supreme Court will announce its decision later this spring.

The trio of lawmakers wrote that their legislation would give states control over the individual insurance market and allow them to design their own exchanges using federal funds currently allocated for the ACA, enable consumers to buy insurance across state lines, end the employer and individual mandates and scrap federal subsidies in favor of tax credits. The proposal retains several popular ACA reforms, including protections for people with pre-existing conditions and coverage for children up to age 26 under their parents’ plans.

The chairmen of the three health-related committees in the Senate, Sens. Orin Hatch (R-UT), John Barrasso (R-WY) and Lamar Alexander (R-TN), also released a joint statement announcing a broad framework for developing an ACA alternative.

Bill Extending Rural Community Hospital Demonstration Introduced

Last Friday, February 27, Sens. Charles Grassley (R-IA) and Michael Bennet (D-CO) introduced the Rural Community Hospital Demonstration Extension Act of 2015 (S. 607), which would extend the Rural Community Hospital Demonstration Program for five more years.

The program was established under the Medicare Prescription Drug, Improvement, and Modernization Act to test cost-based reimbursement practices in rural hospitals that are too large to be considered critical access hospitals. Participating rural community hospitals must be located in one of the 20 states with the lowest population density. These states are Alaska, Arizona, Arkansas, Colorado, Idaho, Iowa, Kansas, Maine, Minnesota, Mississippi, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Utah and Wyoming.

The proposed legislation would also allow rural hospitals more time to expand and improve services. Rep. Don Young (R-AK) introduced an identical bill (H.R. 672) in the House in early February.

Bipartisan Bill Would End ACA Cost-Cutting Board

On Monday, March 2, Reps. Phil Roe (R-TN) and Linda Sanchez (D-CA) introduced a bill (H.R. 1190) to repeal the ACA’s Independent Payment Advisory Board (“IPAB”). The Congressional Budget Office estimates indicate that costs for repealing the IPAB are $3.1 billion over ten years. The bill has 206 co-sponsors, including 17 other Democrats as of March 6. The Obama Administration has not indicated whether the President would veto the legislation were it to reach his desk.

MedPAC Approves Draft RAC Audit Recommendation

On Thursday, March 5, the Medicare Payment Advisory Commission (“MedPAC”) approved draft recommendations to change the Recovery Audit Contractor (“RAC”) program as part of a way to update several Medicare policies governing short hospital stays. MedPAC debated and unanimously approved a set of five draft recommendations that would change how CMS pays for certain short-term hospital admissions. MedPAC will vote on final versions of the recommendations in April.

Other Health Care-Related Bills Introduced This Week

Sen. Rob Portman (R-OH) introduced a bill (S. 629) that would enable hospital-based nursing programs affiliated with a hospital to maintain payments under the Medicare program to hospitals for the costs of such programs.

Rep. Pete Sessions (R-TX) introduced a bill (H.R. 1184) that would amend Title XVIII of the Social Security Act to revise Medicare coverage and payment for advanced surgical dressings in skilled nursing facilities and home health settings.

Next Week in Congress

The House is not in session next week, but the Senate will remain in session. Now that funding for the Department of Homeland Security has been resolved, lawmakers will turn their focus to an extension of the Medicare Sustainable Growth Rate physician payment formula, which is set to expire on March 31.