Draft Bill Seeks to Increase Medicare Reimbursement for Telehealth

On Monday, January 12, members of the House Energy and Commerce Committee released a draft bill that would expand Medicare reimbursement for telehealth services.  The members intend to include the telehealth language into a broader package of legislation known as the 21st Century Cures Initiative, which could be introduced as early as this month. 

The draft telehealth bill would require CMS to develop a methodology for reimbursing both hospital and physician telehealth services “to the same extent and amount” as comparable in-person services.  The bill would expand Medicare reimbursement for telehealth services that replace an in-person visit, reduce readmissions or allow a patient to be moved to a “lower level of care.”

The legislation comes in the wake of the 2015 Physician Fee Schedule, which expanded telehealth reimbursement to behavioral health and annual wellness visits.  However, critics of the draft language contend the bill falls short because it doesn’t resolve the issue of interstate licensing for providers.

MedPAC Votes on Final Hospital Recommendations

On Thursday, January 15, the Medicare Payment Advisory Board (“MedPAC”) issued its final provider payment recommendations for inclusion in its annual report to Congress.  If Congress follows MedPAC’s final recommendations, hospital Medicare payments (combined inpatient and outpatient) would receive a 2.55% update in FY 16.  This is down from a 3.25% recommendation last year.

Repeating last year’s recommendation, MedPAC proposed that Medicare rates for home health agencies, long-term acute care hospitals and hospice providers all be frozen in 2016.  While MedPAC’s recommendations carry no legislative authority, Congress generally gives them serious consideration.

Bipartisan Medical Device Bill Introduced in Senate

On Tuesday, January 13, Senate Finance Committee Chairman Orrin Hatch and a bipartisan group of senators introduced a bill to repeal the Affordable Care Act’s (“ACA”) 2.3% excise tax on medical device providers. Senate Majority Leader Mitch McConnell has indicated that medical device tax repeal is one of his top health care priorities for this Congress.

Proponents of the legislation are confident the bill has the votes to pass the Senate. If all 54 Senate Republicans who support the bill and are joined by the 5 Democratic sponsors, supporters will be only 1 vote shy of the 60 votes necessary to move the measure out of the Senate.

Tavenner to Step Down

On Friday, January 16, CMS Administrator Marilyn Tavenner announced her plans to leave CMS in February.  Tavenner, who was confirmed by the Senate 91-7 in 2013, had been acting administrator since 2011.  While Principal Deputy Administrator Andy Slavitt has been named acting administrator, it is unlikely that a permanent replacement will be named and approved by the Senate before President Obama leaves office.

Bills Introduced This Week

Rep. Jim Renacci (R-OH) released two health-related bills.  H.R. 290 would eliminate the three-day inpatient hospital stay requirement for Medicare beneficiaries who are in need of skilled nursing facility services.  H.R. 289 would allow Medicare beneficiaries to receive Medicare Summary Notices by email instead of postal mail.  The intent behind the bill is that by increasing the frequency of notices, beneficiaries can detect fraudulent billing right away, as opposed to months after the services have been provided.

Rep. Renee Ellmers (R-NC) reintroduced legislation (H.R. 270) that would shorten the 2015 reporting period to three months from the current full-year reporting for Electronic Health Records Incentive Program participants using the 2014 Edition Certified EHR.

Sen. Bill Cassidy (R-LA) introduced a bill (S.157) to repeal both the medical device tax and the employer and individual mandates required by the ACA.

Next Week in Congress

Both the House and Senate return next week.  On January 20, President Obama will appear before Congress to deliver the State of the Union address.

The House Energy and Commerce Health Subcommittee plans to hold a two-day hearing, January 21 and 22, on the sustainable growth rate (“SGR”) formula that determines Medicare physician pay rates.  Last year, parties in both chambers negotiated an agreement on a permanent SGR replacement policy, but the agreement stalled when lawmakers failed to agree on how to pay for the measure. If Congress fails to extend the current SGR payment patch or replace the formula before March 31, major Medicare physician payment cuts will be implemented.