EHR Final Rule Loosens Certification Requirements and Program Incentives

On September 10, 2014, the United States Department of Health and Human Services (HHS) released final rule requirements for electronic health records (EHR). This final rule modifies the existing 2014 certification requirements for EHR developers, so their software products may be used by physicians and hospitals in Medicare and Medicaid meaningful use programs.

These are some of the key changes that appear in the final rule:

  • Providers may be able to use previous editions of certified EHR technologies to meet 2014 reporting requirements under the EHR incentives program.
  • Stage 2 of the EHR Incentive Program has been extended a full calendar year to October 1, 2016, for institutional providers and to January 1, 2017, for noninstitutional providers.

HHS decided not to adopt the voluntary standards proposed by the Office of the National Coordinator of Health Information Technology earlier this year. Instead, this final rule aims to add flexibility and clarity to the current 2014 Edition EHR certification criteria.

CMS Announces Dates for Ambulance Prior Authorization Requirements

On September 15, 2014, the Centers for Medicare and Medicaid Services (CMS) officials announced a prior authorization model demonstration program for nonemergent ambulance repetitive transport. The program requires Medicare preauthorization and will begin November 15, 2014, in South Carolina and December 15, 2014, in New Jersey and Pennsylvania. The demonstrations are targeted at testing whether prior authorization can lower costs while maintaining quality of care.

Ambulance providers may begin submitting prior authorization requests on October 30, 2014, in South Carolina and December 1, 2014, in New Jersey and Pennsylvania.

CMS Releases ACO Data

CMS recently released Accountable Care Organization (ACO) quality and financial performance results   for the Medicare Pioneer (Pioneer) and Medicare Shared Savings Programs (MSSP). The data shows that Medicare ACOs have been successful in improving the quality of care to Medicare beneficiaries through both the Pioneer and MSSP models.

Pioneer ACO data came from 23 participating organizations, while MSSP data was compiled from 220 participating ACOs.

Court of Appeals for D.C. Will Rehear ACA Subsidy Challenge

The U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) has agreed to rehear an issue pertaining to a clause in the Affordable Care Act (ACA) that says Americans who purchase their insurance through an exchange “established by the State” will be provided with subsidies to help pay for their insurance premiums. The ACA omits any mention of the federal exchange.

ACA opponents have made the argument that without expressly stating the “federal exchange,” the federal government lacks the authority to issue insurance subsidies in states that do not run an exchange. Thirty- six states do not run their own exchanges.

Previously, a three-member panel of the U.S. Court of Appeals (D.C. Circuit) agreed with ACA opponents and struck down the federal government’s ability to provide subsidies. The en banc rehearing will provide a second opportunity for the Obama administration to argue its position of federal backing for the states regardless of the current language drafted in the ACA.

HHS Data Shows 25 Percent Increase in ACA Insurers for 2015

HHS released a report on September 23, 2014, stating that there will be a 25 percent increase in the number of insurers providing health plans in the ACA health insurance marketplaces for 2015. The new insurers will begin offering plans on November 15, 2014, when the second enrollment period opens.

The 25 percent translates to seventy-seven new issuers offering coverage on the ACA exchanges. Fifty- seven of these insurers will be on the federally facilitated marketplace.

ACA Tax Implications for Employers

Starting in 2016, tax provisions of the ACA will mandate employers to report more than the usual W-2 and 1099 forms.  The 2016 filings will include 2015 calendar data. Employers should take steps now to review the forms and instructions as well as ensure that they have the necessary reporting capabilities and resources to handle the tax reporting changes.

Section 6055 of the Internal Revenue Code (Code) sets forth an individual mandate that requires “minimum essential health coverage” or a tax penalty. To assist with enforcement of the tax penalty and ensuring coverage of individuals, certain employers that sponsor health plans for their employees are required to include health plan information for each employee with their tax filing.

Section 6056 of the Code addresses employer shared responsibility. This section requires applicable larger employers, or an employer with an average of fifty full-time employees or equivalent, to file annual returns with the Internal Revenue Service (IRS) and give annual coverage statements to their full-time employees.

As mentioned, the ACA tax reporting requirements will add 1094 and 1095 forms to an employer’s annual tax filings. Forms 1095-B and 1095-C will include employee health coverage information and are to be filed with the respective transmittal form, 1094-B or 1094-C. Small employers with self-insured health plans, such as those covered in Section 6055 of the Code, will use the 1094-B and 1095-B forms. Larger employers with self-insured health plans, such as those covered in Section 6056 of the Code, will use the 1094-C and 1095-C forms. Electronic filing is mandated for an employer filing 250 forms or more with the IRS. The IRS has released both drafts and instructions for the forms.

Congress Passes Bill Requiring Post-Acute Providers to Collect Data

On September 16, 2014, the United States House of Representatives passed a bill under the Improving Medicare Post-Acute Care Transformation Act (IMPACT) designed to strengthen Medicare’s post-acute care (PAC) system. IMPACT would require providers to submit standardized patient assessment and quality data by 2019 to allow Medicare to compare quality across PAC settings.

IMPACT is anticipated to assist in PAC reform. HHS and the Medicare Payment Advisory Commission would be required to give recommendations to Congress for a new PAC payment system using the IMPACT data findings. The bill is currently awaiting approval from the executive branch.

HHS Grants Chronic Disease Prevention $211.6 Million

HHS made an announcement this month that it will be awarding $211.6 million in grants to programs intended to prevent major chronic diseases. This initiative is partially funded by the ACA in hopes of reducing the nation’s overall health care bill.

These grants will be administered by the Centers for Disease Control and Prevention (CDC) and organized by the most prevalent and costly diseases, such as obesity, diabetes, and heart disease.

President Order to Combat Antibiotic-Resistant Bacteria

President Obama implemented a federal regulatory initiative by signing an executive order urging federal departments and agencies to combat antibiotic-resistant bacteria. The order calls for a five-year plan and task force to enhance prevention and containment of outbreaks, while investing in research and development for next-generation diagnostics, antibiotics, and vaccines. In addition to the task force, the plan also offers a $20 million award for creating a test to identify resistance.

Seventh Circuit Dismisses Obamacare Mandate Lawsuit

The United States Court of Appeals for the Seventh Circuit threw out a lawsuit challenging the postponement of the ACA employer mandate. The court said the plaintiffs, the Association of American Physicians and Surgeons (AAPS), had no standing.

AAPS argued that the federal government could not use its power to delay the mandate for employers to provide their employees with health insurance if the government was not going delay the individual mandate in tandem. Plaintiffs also asserted that a delay in enforcing the mandate hurts AAPS members financially because when people pay the penalty they have less income to buy medical care.

The three-judge panel made the decision in late September, reasoning that the United States Supreme Court has often held there is no standing in lawsuits made by individuals to protect the interests of a third party. Judge Easterbrook wrote for the panel, stating, “The Supreme Court has rejected efforts by one person to litigate about the amount of someone else’s taxes (or someone else’s subsidies, which are taxes in reverse).”