Obama Releases FY 2017 Budget

On February 9, President Obama released a $4.1 trillion budget outlining spending proposals and priorities for fiscal year 2017. Nearly one-fourth of the budget is allocated to CMS for the agency’s entitlement programs. The proposal also provides $82.8 billion in discretionary funding for HHS and makes mandatory investment in programs aimed at increasing access to mental health and substance abuse services and supporting cancer research.

Obama’s budget also provides funding for a number of other health-related initiatives, including: $559 million to expand HHS’s efforts to fight the opioid epidemic; $755 million for Vice President Joe Biden’s cancer moonshot program; $500 million over two years to expand the behavioral health workforce and improve care for people with mental illnesses; $380 million for the National Health Service Corps to expand the primary care workforce; $300 million for the National Institutes of Health’s Precision Medicine Initiative to accelerate research on personalized treatments for individual patients; and $6.6 billion for the Indian Health Service to assist in reducing health disparities.

The budget allows states that have not expanded Medicaid to have the federal government take on the full cost of expansion for three full years, regardless of when they expand. Currently, the Affordable Care Act only requires the federal government to bear expansion costs through 2016. It also includes policies to help states lower prices for high-cost drugs using a federal-state Medicaid negotiating pool.

Expanded Telehealth Proposed in President’s Budget

Included in the president’s proposed fiscal year 2017 budget was funding to allow federally qualified health centers and rural health clinics to be originating telehealth sites under Medicare and to expand telehealth services in Medicare Advantage. The proposal allows the HHS secretary to expand telehealth services in Medicare Advantage organizations by eliminating Part B requirements that certain covered services be provided only through face-to-face meetings. The beneficiary would determine whether to use the telehealth benefit or not. The proposal is similar to legislation that was introduced in the Senate last week by Sen. Brian Schatz (D-HI) and in the House (H.R. 4442) by Rep. Diane Black (R-TN).

CMS Publishes Final Rule on Medicare Overpayments

On February 11, CMS issued a final rule requiring health care providers and suppliers participating in Medicare Parts A and B to report and return overpayments within 60 days after the overpayment was identified or the due date of any corresponding cost report. Failing to report overpayments can result in liability under the False Claims Act. The rule takes into account various compliance programs and allows providers and suppliers up to six months to investigate potential errors. It also reduces how far providers must search through claims for overpayments from ten years to six years.

The final rule clarifies requirements for reporting and returning self-identified payment errors and holds providers and suppliers accountable under the statutes in section 1128J (d) of the Social Security Act. Providers and suppliers who fail to report and return an overpayment may be subject to False Claims Act liability, Civil Monetary Penalties Law liability and exclusion from federal health programs.

CMS Extends EHR Attestation Deadline

On February 11, CMS extended the deadline for hospitals to attest to meaningful use of electronic health records until March 11, 2016. The original deadline was February 29, 2016. Under the final rule modifying meaningful use requirements for 2015-2017, hospitals and critical access hospitals must attest to meaningful use of EHRs for a continuous 90-day period between October 1, 2014 and December 31, 2015 to avoid payment adjustment.

Health-Related Bills Introduced This Week

Sens. Debbie Stabenow (D-MI) and Roy Blunt (R-MO) introduced the Expand Excellence in Mental Health Act (S. 2525) to increase funding for community mental health and substance abuse services in selected states. The legislation would fully fund comprehensive community behavioral health services in the 24 states that were selected in October 2015 to work with mental health organizations to design state programs that meet the new quality standards for Certified Community Behavioral Health Centers.

Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA) introduced a bill (S. 2511) to strengthen health information technology to help drive treatment and improve health outcomes. The Improving Health Information Technology Act would develop patient-centered health record technology so that patients can access their health information, and it would certify information systems for specialty providers and sites of service where more specialized technology is needed.

Next Week in Washington

After a busy week focused on President Obama’s 2017 budget, the House and Senate will be out of session next week. Both chambers return the week of February 22.