Bipartisan Stark Law Correction Bill Reintroduced

On February 5, Reps. Charles Boustany (R-LA) and Ron Kind (D-WI) reintroduced the Stark Administrative Simplification Act (H.R. 376). The legislation corrects the disproportionate penalties a hospital can incur under the Stark Law for having an unwritten, unsigned or lapsed agreement that is otherwise compliant with federal fraud and abuse law. It is the product of an ongoing effort made by the Hall Render Stark Law Correction Coalition to lobby Congress to address this issue.

The measure would limit the penalty to $5,000 if one of these violations is disclosed within one year of the date of noncompliance.  A violation disclosed more than one year from the date of noncompliance would be limited to a penalty of $10,000.  The bipartisan proposal would also create a streamlined process for disclosure and resolution at CMS within 90 days.

Industry analysis has shown the measure could generate as much as $1 billion in new revenue over a 10-year period.  Reps. Susan Brooks (R-IN), Larry Bucshon (R-IN), Michael Burgess (R-TX), Tim Guthrie (R-KY), Mike Pompeo (R-KA), Marc Veasey (D-TX) and Todd Young (R-IN) are original cosponsors of the bill.  The bill was referred to the House Ways and Means or Energy and Commerce committees where seven of the eight sponsors are members.

Administration Releases President’s 2016 Budget Proposal

On Monday, February 2, the Office of Management and Budget released President Obama’s fiscal year 2016 budget.  The President’s budget proposal would reduce net Medicare spending by $423 billion between 2016 and 2025 and is estimated to extend the solvency of the Medicare Hospital Insurance Trust Fund by approximately five years.

Health care provisions in the budget proposal include: reducing Medicare bad debt payments to providers, restructuring payments for post-acute care services by adopting a bundled payment approach beginning in 2020, lowering payments to services provided in off-campus hospital outpatient departments beginning in 2017 and cutting almost $16.3 billion in graduate medical education funding.  The President also proposed cutting enhanced Medicare payments to critical access hospitals by reducing payments to 100% of costs and eliminating the designation for those critical access hospitals within 10 miles of another hospital beginning in 2016.

With Republican majorities in the House and Senate, the bulk of the budget proposal will be ignored by Congress.  However, it will serve as a starting point for congressional budget negotiations and a tool to showcase the President’s priorities.

House and Senate Introduce Bill to Extend Medicare Rural Hospital Programs

On Tuesday, February 3, Sen. Chuck Grassley (R-IA) introduced a bill (S. 332) that would make permanent both the Medicare Dependent Hospital (“MDH”) program and the low volume Medicare adjustment for small rural prospective payment system hospitals.  Without an extension, these two programs will expire April 1, 2015.  There are currently more than 200 MDHs in 32 states.  A companion bill was introduced in the House by Rep. Tom Reed (R-NY).

Bills Introduced This Week

Rep. Greg Walden (R-OR) introduced a bill (H.R. 745) that would amend Title XVIII of the Social Security Act to increase access to ambulance services under Medicare and reform the payments for ambulance services.

Rep. Bill Huizenga (R-MI) introduced a bill (H.R. 795) that would make payment rates for certain hospital inpatient procedures, hospital outpatient procedures and physician services available to the public through the Medicare internet site.

Ways and Means Chairman Paul Ryan (R-WI) introduced a bill (H.R. 804) that would increase access to Medicare data.

Rep. Doris Matsui (D-CA) reintroduced the Telehealth Modernization Act, which seeks to establish a federal standard for telehealth.  The bill (H.R. 691) was referred to the House Energy and Commerce Committee.

Next Week in Washington

The House and Senate enjoy a three-day weekend and return Monday, February 9, when the Senate will continue debate on homeland security funding.  Next Wednesday, February 11, the Energy and Commerce Committee will hold a hearing on ICD-10 implementation.