1. Congress

House of Representatives

Energy and Commerce Releases Draft of Physician Payment Fix

On May 28, the Energy and Commerce Committee released a third draft of a proposal to overhaul Medicare's physician payment system. The panel has previously circulated outlines, but has now moved to legislative language that would provide for a three-phase implementation of a permanent fix to the sustainable growth rate (SGR) formula, which has called for outsized reductions in payments to physicians, and has been overridden annually by Congress. In phase one, the sustainable growth rate formula in the physician payment system would be repealed, and physicians would be provided an unspecified period of stable payments. In phase two, payment would be based on quality-of-care measures. Phase three would call for further reform of Medicare's fee-for-service payment system to account for the efficiency of care provided. Energy and Commerce lawmakers want comments on the latest draft by June 10. Comments can be sent to SGRComments@mail.house.gov.  The Energy and Commerce Health Subcommittee also is holding a hearing on the issue June 5.

Lawmakers Concerned About Licenses for DME Bid Winners

According to some Tennessee members of Congress, some of the durable medical equipment (DME) suppliers that won contracts to serve Tennessee Medicare beneficiaries under CMS's competitive bidding program do not have the appropriate licenses. In a letter to CMS, Sen. Alexander (R-TN) and other members of the Tennessee Congressional delegation wrote, ''Memphis, Knoxville, Chattanooga, and Nashville metropolitan statistical areas are included in the Round 2 expansion. Tennessee law requires a physical location in the state as a prerequisite to obtaining a license to provide medical equipment.'' But because bids came from suppliers not licensed in Tennessee, ''their ability to serve Medicare beneficiaries skewed the bidding process and should not have been included, nor should their bid prices have been included to determine median pricing or affected product categories,'' according to the delegation's letter.


HELP Committee Advances Rx Drug Safety Bills

On May 22, the HELP Committee favorably reported two bills aimed at enhancing the safety and security of pharmaceutical drugs. One would apply a new regulatory structure for compounding pharmacies and the other would impose new requirements on entities that handle prescription medication through the downstream drug distribution system. That same week, the House Energy and Commerce Health Subcommittee held a hearing examining drug compounding. The hearing had two panels. The first panel occupied the majority of the hearing with one witness, Dr. Janet Woodcock, Director of the Center for Drug Evaluation and Research at the Food and Drug Administration (FDA). The second panel included the following five witnesses:

  • Scott Gottlieb, M.D., Resident Fellow, American Enterprise Institute
  • Joseph Harmison, Harmison Pharmacies on behalf of National Community Pharmacists Association
  • Gerry Migliaccio, Migliaccio Consulting
  • Elizabeth Scott Russell, Government Affairs Manager, National Association of Boards of Pharmacy
  • Gabrielle Cosel, Manager of Drug Safety, Pew Charitable Trusts

For more information, or to view the hearing, please visit: http://energycommerce.house.gov/hearing/examining-drug-compounding

For more information, or to view the HELP markup, please visit: http://www.help.senate.gov/hearings/hearing/?id=96c56d5d-5056-a032-52c5-e7208991a71a

The House is also expected to consider during the week of June 3 its version of drug distribution security legislation, referred to as ''track and trace.'' The bill, H.R. 1919, would require transaction information documenting each instance in which a drug was bought or sold, in order to help doctors and pharmacists verify the safety and integrity of the drugs they possess.

  1. Administration


Medicare Trustees Report Additional Two Years of Solvency

Last week, the Medicare Trustees projected that the trust fund that finances Medicare's hospital insurance coverage will remain solvent until 2026, two years beyond what was projected in last year's report. According to the trustees, lower-than-expected Part A spending in 2012 and lower projected Medicare Advantage program costs contributed to their findings. From 2010 to 2012, Medicare spending per beneficiary grew at 1.7 percent annually, more slowly than the average rate of growth in the Consumer Price Index, and substantially more slowly than the per capita rate of growth in the economy. In 2012, Medicare covered 50.7 million people: 42.1 million people aged 65 and older, and 8.5 million people with disabilities. About 27 percent of these beneficiaries have chosen to enroll in Part C private health plans that contract with Medicare to deliver Part A and Part B health services. Total expenditures in 2012 were $574.2 billion. Total income was $536.9 billion. The Medicare Trustees are Treasury Secretary and Managing Trustee Jacob Lew, Health and Human Services Secretary Kathleen Sebelius, Acting Labor Secretary Seth Harris and Acting Social Security Commissioner Carolyn Colvin. Two other members are public representatives who are appointed by the President, subject to confirmation by the Senate. Charles Blahous III and Robert Reischauer began serving on Sept. 17, 2010. CMS Administrator Tavenner is designated as Secretary of the Board. View the report: http://downloads.cms.gov/files/TR2013.pdf


Final Rule on Employee Choice for Small Business Health Options Program (SHOP)

Last week, CMS announced its final rule implementing the ACA's provisions related to the Small Business Health Options Program (SHOP). Specifically, this final rule amends existing regulations regarding triggering events and special enrollment periods for qualified employees and their dependents and implements a transitional policy regarding employees' choice of qualified health plans (QHPs) in the SHOP. These regulations are effective on July 1, 2013. Under the rule, in 2014, employers purchasing coverage through federal SHOP exchanges can offer only one health plan to employees. According to HHS, ''[t]he SHOP will still provide employers with a streamlined comparison of health plans from multiple health insurance issuers, assistance modeling employee contributions and real-time premium quotes. These benefits would not be available to employers under simplified implementation suggested by one commenter. Further, plans sold on the SHOP must be certified as QHPs, meaning that they must meet minimum standards in order for issuers to sell them on the SHOP. We believe that because of this strong value proposition, the SHOP may still have robust enrollment despite the adoption of this transitional policy.'' View the final rule: http://www.ofr.gov/OFRUpload/OFRData/2013-13149_PI.pdf

CMS Actuary: No IPAB Spending Reductions Necessary Through 2015

According to an announcement made May 31, the Independent Payment Advisory Board, created by the ACA as a way to curb excessive Medicare spending, will not be needed through 2015. ''Since the projected update to the single conversion factor applicable to payments for physicians' services under section 1848(d) of the Social Security Act is negative for 2014 and 2015, section 1899A(c)(6)(B)(ii) of the Social Security Act requires that the Medicare growth rate be calculated as if the update for these services were 0 percent rather than the negative percentage that would otherwise apply,'' Acting Chief Actuary Paul Spitalnic said. ''The resulting year-by-year growth rates that were used in the determination are shown in the following table. The projected 5-year average growth in Medicare per capita spending is 1.46 percent, and the 5-year average growth target is 3.04 percent. Because the projected 5-year Medicare per capita growth rate does not exceed the Medicare per capita target growth rate, there is no applicable savings target for implementation year 2015 (determination year 2013).'' View announcement: http://www.cms.gov/Research-Statistics-Data-and-Systems/Research/ActuarialStudies/Downloads/IPAB-2013-05-31.pdf

CMS Hosting July 2013 Meeting to Discuss 2014 Clinical Labs Payment Amounts

In a notice published May 24, the Centers for Medicare & Medicaid Services (CMS) announced it will hold a public meeting July 10 at its Baltimore headquarters to hear comments and recommendations on payment amounts for a new or revised Healthcare Common Procedure Coding System under the clinical laboratory fee schedule (CLFS) for 2014. Every year, CMS adds new laboratory test codes to the laboratory fee schedule, and corresponding fees are developed in response to this public comment process. CMS intends to publish these proposed determinations for new and reconsidered codes for 2014 by early September. As it stands, outpatient clinical laboratory services are paid based on a fee schedule set out in Section 1833(h) of the Social Security Act; Congressional legislation could modify the fees. Existing fees are updated for inflation dependent on a percentage change in the Consumer Price Index. Comments on the proposed payment levels are due Sept. 27.

Anti-Nausea Drug Regime Now Covered for Chemotherapy Patients

The Centers for Medicare & Medicaid Services (CMS) announced in a May 29 memo that it will expand its coverage of anti-nausea and vomiting drug therapy for beneficiaries undergoing chemotherapy. Patients beginning cancer treatments often attest to chemotherapy-induced vomiting or nausea as a major concern, particularly as poorly controlled nausea ''can result in significant and severe physiological consequences, including nutritional derangements, metabolic imbalances, anorexia, esophageal tears, fractures, and wound dehiscence,'' CMS said. CMS first proposed expanding Medicare coverage of nausea and vomiting (N&V) drugs in a memo March 20. All-oral N&V regimens will be covered when administered in singularity or combination within a 48-hour time frame of 20 predetermined chemotherapy drugs that are deemed by the FDA to be highly or moderately emetogenic. View memo: http://www.cms.gov/medicare-coverage-database/details/nca-decision-memo.aspx?NCAId=264

CMS to Authorize the Disclosure of Medical Records to Health Plans

In an effort to combat health care fraud, the Centers for Medicare & Medicaid Services will allow 23 databases to make provider beneficiary information available to health plans. In a notice filed with the Federal Register, CMS stated that the disclosure of provider information will be allowed when ''deemed reasonably necessary by CMS to prevent, deter, discover, detect, investigate, examine, prosecute, sue with respect to, defend against, correct, remedy, or otherwise combat fraud, waste, or abuse'' of federal health programs. Disclosures will be handled by CMS's Data Sharing and Partnership Group and, unless revisited, are due to take effect June 27. https://www.federalregister.gov/articles/2013/05/29/2013-12690/privacy-act-of-1974-report-of-a-new-routine-use-for-selected-cms-systems-of-records


New Member to Join MedPAC, Five Reappointments

According to an announcement made May 30 by the Government Accountability Office, the Medicare Payment Advisory Commission (MedPAC) will reappoint five existing members and appoint one new member to the commission. Jon B. Christianson, a professor at the School of Public Health at the University of Minnesota in Minneapolis, will join MedPAC as the newest member of the 17-person commission. Christianson's research has looked closely at health finance, rural health care, managed care payments, payment structures, and the design and quality of care systems. He will be replacing Thomas M. Dean, a family physician from Wessington Springs, South Dakota.  

  1. State Activities

South Carolina Senate Rejects Medicaid Expansion

The South Carolina Senate recently rejected another attempt by Democrats to extend Medicaid coverage under the ACA, defeating by a 23-19 vote a proposal that would have inserted the expansion into the state's 2013-2014 budget. House Republicans defeated attempts during that chamber's budget debates along party lines. The Senate Finance Committee's budget plan advanced to the floor after Democrats voted ''present'' to protest it not including the expansion. More information: http://www.scnow.com/news/politics/article_a1613c16-c1f5-11e2-874f-001a4bcf6878.html

Ohio Republican Offers Plan to Salvage Medicaid Expansion

Under a proposal recently introduced by Ohio State Rep. Barbara Sears, a Republican from Monclova Township and the House majority floor leader, individuals with incomes up to 138 percent of the federal poverty level, or about $15,400 a year for an individual and $32,000 a year for a family of four would be eligible for Medicaid, pursuant to the ACA. The proposal also takes the federal government up on its offer to give Ohio about $13 billion over seven years to expand programs to as many as 366,000 low-income residents. The proposal comes after Ohio's GOP-controlled House and Senate stripped plans for Medicaid expansion from Gov. John Kasich's state two-year budget proposal earlier this year. ''I think it will definitely be a starting point for discussion,'' said Mike Dittoe, spokesman for state House Speaker Bill Batchelder, a Republican from Medina, Ohio. ''But any indication as far as where the caucus stands or the overall support from the legislature is somewhat premature simply because the bill was introduced (Wednesday).'' More information: http://www.usatoday.com/story/news/nation/2013/05/23/medicaid-expansion-ohio/2355683/

  1. Regulations Open for Comment

Pre-Existing Condition Insurance Plan (PCIP) Interim Final Rule

CMS has issued an interim final rule with comment period sets the payment rates for covered services furnished to individuals enrolled in the Pre-Existing Condition Insurance Plan (PCIP) program administered directly by HHS beginning with covered services furnished on June 15, 2013. The rule sets most reimbursement rates in federally administered PCIPs at Medicare levels. This interim final rule also prohibits facilities and providers who, with respect to dates of service beginning on June 15, 2013, accept payment for most covered services furnished to an enrollee in the federally-administered PCIP from charging the enrollee an amount greater than the enrollee's out-of-pocket cost for the covered service as calculated by the plan. The rule also bans ''balance billing'' enrollees of the federal-run PCIPs to protect them ''from having to potentially shoulder significant costs that could be shifted to them as a result of this new payment policy.'' Comments will be accepted through July 19. View the interim final rule: http://www.ofr.gov/OFRUpload/OFRData/2013-12145_PI.pdf

Disproportionate Share Hospital Proposed Rule

CMS has issued a proposed rule on Disproportionate Share Hospital (DSH) payment reductions required by the ACA, applying a methodology that would not distinguish between states that have chosen to expand their Medicaid programs, pursuant to the ACA. According to the proposed rule, data reflecting the effects of the decision to implement the new coverage group may not be available to consider the impact of a state's decision to expand or not until 2016. Once finalized, this rule will go into effect on Oct. 1, unless Congress enacts the president's budget proposal to begin the Medicaid DSH allotment reductions in fiscal year 2015 instead of FY 2014, while retaining the same total amount of reductions through 2020. The Affordable Care Act requires aggregate reductions to state Medicaid DSH allotments annually from FY 2014 through FY 2020. Comments on the proposed rule are due July 12. View the proposed rule: http://www.ofr.gov/OFRUpload/OFRData/2013-11550_PI.pdf

Tanning Bed Warning Label Proposal

The FDA issued a proposal that would elevate tanning beds from a low-risk to high-risk medical device and would add a warning label to them. If the order is finalized, manufacturers would have to submit a pre-market notification (510(k)) to the FDA for these devices, which are currently exempt from any pre-market review. Manufacturers would have to show that their products have met certain performance testing requirements, address certain product design characteristics and provide comprehensive labeling that presents consumers with clear information on the risks of use. The order proposes to include a contraindication against use on people under 18 years old, and the labeling would have to include a warning that frequent users of sunlamp products should be regularly screened for skin cancer.

The FDA will take comments on the proposed order until Aug. 7.

To view the Proposed Order, called "Reclassification of Ultraviolet Lamps for Tanning, Henceforth To Be Known as Sunlamp Products," please visit: www.fda.gov

Skilled Nursing Facility FY 2014 Payment Rule

CMS has issued a proposed rule that would raise payments to skilled nursing facilities (SNF) by $500 million or 1.4 percent in fiscal year 2014. The rate reflects an estimated increase of 2.3 percent market basket increase, reduced by a 0.5 percentage point forecast error correction and further reduced by a 0.4 percentage point productivity adjustment required by law. CMS said the proposal would both revise and rebase the payment by requiring the establishment of an updated SNF marketplace index that would reflect changes over time in the prices of an appropriate bundle of goods and services for covered SNF services within the Medicare system. The proposed changes to the SNF market basket would reflect FY 2010 allowable Medicare total cost data (routine, ancillary and capital-related), shifting from FY 2004 base year, as it is the most recent year for which relatively complete Medicare cost report data is available. Other significant changes within the rule would establish a Minimum Data Set (MDS) to record the number of distinct calendar days of therapy for all rehabilitation disciplines to be linked to each beneficiary; such a proposal would clarify the qualifying conditions for "Medium Rehab Category" and "Low Rehab Category" to five and three distinct calendar days respectively. Comments are due by July 1, 2013.

Hospice Payment Rule Proposed

CMS issued a proposed rule addressing hospice payment rates and the wage index for fiscal year (FY) 2014. The proposed rule would increase Medicare payments to hospices by an estimated 1.1 percent for FY 2014, amend hospice quality reporting requirements, clarify coding requirements and update stakeholders on hospice payment reform. As proposed, hospice providers would receive an estimated 1.1 percent increase in their payments for FY 2014, a net result of a proposed hospice payment update to the hospice per diem rates of 1.8 percent (a "hospital market basket" increase of 2.5 percent minus 0.7 percentage point for reductions mandated by the Affordable Care Act), and a 0.7 percent decrease in payments to hospices due to updated wage data and the fifth year of CMS's seven-year phaseout of its wage index budget neutrality adjustment factor. CMS will accept comments on the proposed rule until June 28, 2013.

IRS Proposed Rule -- Employer-Sponsored Plan Value

The Internal Revenue Service has published a proposed rule on the minimum required value of employer-sponsored coverage that won't trigger the employer mandate penalty and other provisions involving the premium tax credits on the exchanges. The proposed regulations affect individuals who enroll in qualified health plans through Affordable Insurance Exchanges (Exchanges) and claim the premium tax credit, and Exchanges that make qualified health plans available to individuals and employers. These proposed regulations also provide guidance on determining whether health coverage under an eligible employer-sponsored plan provides minimum value and affects employers that offer health coverage and their employees. Comments will be accepted until July 1, 2013.

Inpatient Rehabilitation Facility Prospective Payment Proposed Rule

CMS has announced proposed changes to update the Medicare Inpatient Rehabilitation Facility Prospective Payment System (IRF PPS) rates for fiscal year (FY) 2014. CMS proposes to increase Medicare payments to IRFs in FY 2014 by 2.0 percent, or $150 million. This proposed increase reflects the combined effects of a 2.5 percent market basket increase factor, a 0.4 percent reduction due to the multifactor productivity adjustment and an additional 0.3 percent reduction as required under the Affordable Care Act. CMS is proposing an update to the outlier threshold, which would increase IRF payments by an estimated 0.2 percent.

CMS is also proposing to update the presumptive methodology used in determining whether an IRF has met the requirements of the "60-percent rule" by removing a number of codes from the presumptive compliance list. This revised list is meant to reflect only those codes that can be identified presumptively as both representing one of 13 conditions and requiring intensive rehabilitation. The proposed revisions fall in the following categories: nonspecific diagnosis codes, arthritis diagnosis codes, unilateral upper extremity diagnosis codes, some congenital anomalies diagnosis codes and other miscellaneous diagnosis codes. Public comments on the proposals will be accepted until July 1, 2013.

Inpatient Prospective Payment System (IPPS) Proposed Rule

CMS has issued a proposed rule to revise the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals to implement changes arising from continuing experience with these systems. These proposed changes would be applicable to discharges occurring on or after Oct. 1, 2013, unless otherwise specified in this proposed rule. The proposed rule includes an update to the rate-of-increase on limits for certain hospitals excluded from the IPPS that are paid on a reasonable cost basis subject to these limits. The proposed updated rate-of-increase limits would be effective for cost reporting periods beginning on or after Oct. 1, 2013. In addition, the proposed rule includes a number of changes relating to direct graduate medical education (GME) and indirect medical education (IME) payments. Specifically, CMS proposes to establish new requirements or revised requirements for quality reporting by specific providers (acute care hospitals, PPS-exempt cancer hospitals, LTCHs and inpatient psychiatric facilities (IPFs) that are participating in Medicare. Lastly, the proposed rule includes updated policies relating to the Hospital Value-Based Purchasing (VBP) Program and the Hospital Readmissions Reduction Program. Rates for inpatient stays at hospitals that participate in the quality reporting system would increase by 0.8 percent in 2014 under the proposed Prospective Payment System rule. Rates at long-term care hospitals would go up by 1.1 percent. The proposed IPPS rule also clarifies that a hospital inpatient admission spanning two midnights -- more than one Medicare utilization day -- would be paid for under Part A. Comments must be submitted by 5 p.m. on June 25, 2013.

Medicare Fraud Tip Proposed Rule Would Increase Financial Reward

CMS has issued a proposed rule that would revise the Medicare Incentive Reward Program (IRP) to increase the potential financial reward for successful Medicare fraud tips to $9.9 million, up from $1,000 or 10 percent of recovered amount, whichever is less. The new standard would apply a formula of up to 15 percent of the first $66 million recovered. The Medicare Incentive Reward Program was created under the Health Insurance Portability and Accountability Act (HIPAA), which stated the HHS Secretary should implement a program to reward individuals who report potential Medicare fraud. Comments are due no later than 5 p.m. on June 28.

Charitable Hospital Rule

CMS has announced a proposed rule providing guidance to charitable hospital organizations on the community health needs assessment (CHNA) requirements, and related excise tax and reporting obligations enacted as part of the Patient Protection and Affordable Care Act of 2010. The proposed regulation also clarifies the consequences for failing to meet these and other requirements for charitable hospital organizations. These regulations will affect charitable hospital organizations.

Comments and requests for a public hearing must be received by July 1.

CMS Proposed Rule Would Increase Oversight of Accrediting Organizations

CMS has issued a proposed rule that would revise the survey, certification and enforcement procedures related to CMS oversight of national accreditation organizations (AOs). These revisions would implement certain provisions under the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA). The proposed revisions would also clarify oversight of AOs that apply for, and are granted, recognition and approval of an accreditation program in accordance with the Social Security Act. According to the proposed rule, health care facilities, with the exception of kidney transplant centers, end-stage renal dialysis facilities and providers of medical equipment and supplies, can demonstrate their compliance with Medicare conditions of participation, conditions of certification or conditions of coverage by being accredited by a CMS-approved organization. The proposed rule would implement, among other things, provisions requiring prospective or existing accreditation organizations seeking CMS approval of their programs to submit documentation proving they are a national accreditation organization, defined as an organization that accredits health care facilities under a specific program and whose accredited health care facilities under each program are widely located geographically across the United States. Comments on the proposed rule are due June 4.

IRS, HHS, DOL Issue Proposed Health Coverage Waiting Periods Rules

Under proposed rules issued jointly by the Internal Revenue Service, the Department of Labor's Employee Benefits Security Administration and the Department of Health and Human Services, no group health plan or group health insurance issuer could impose a waiting period that exceeds 90 days after employment. The rules also would amend regulations to conform to ACA provisions already in effect, as well as those that will become effective beginning in 2014, barring discrimination against people with pre-existing medical conditions. Comments are due by May 20.

FDA Proposed Rule on Defibrillator Premarket Approval Applications

The FDA filed notice of of a proposed rule to require the filing of a premarket approval application (PMA) or a notice of completion of a product development protocol (PDP) for the following class III preamendment devices: automated external defibrillators systems (AEDs), which include the AED device and its accessories (i.e., pad electrodes, batteries and adapters). The Agency is also summarizing its proposed findings regarding the degree of risk of illness or injury designed to be eliminated or reduced by requiring this device to meet the statute's premarket approval requirements and the benefits to the public from the use of the device. In addition, FDA is announcing the opportunity for interested persons to request that the Agency change the classification of the AED based on new information. This action implements certain statutory requirements. Comments will be accepted until June 20.

CMS Request for Information (RFI) on Health Information Technology

CMS and the Office of the National Coordinator for Health Information Technology released a request for information on a number of options to further push the exchange of health information. Suggested options include requiring or encouraging Medicare ACOs to include health information exchange components, requiring health information exchange components in care models for dual eligibles and promoting the use of "Blue Button," which is a way for consumers to securely access their health information.

FDA Draft of Risk-Benefit Plan Published

The FDA filed a draft of its five-year plan for developing and implementing a benefit-risk framework that will guide its review of drugs. The notice was provided for in last year's prescription drug user fee agreement. Drug companies and some patient advocates have argued that FDA is overly concerned with risks that the market is willing to bear. FDA agreed to go through a public process of developing a framework that would factor those concerns into its review process.

  1. Reports


Medicare Could Save Millions by Implementing a Hospital Transfer Payment Policy for Early Discharges to Hospice Care

According to a recent report by the HHS-OIG, CMS could have saved a total of $600 million in 2009 and 2010 if it had enacted a hospital transfer payment policy for early discharges to hospice. Specifically, OIG found that approximately 30 percent of all hospital discharges to hospice care were early discharges that would have received per diem payments rather than full payments under a hospital transfer payment policy. In addition, this transfer payment policy would not have caused a significant financial disadvantage for hospitals or disproportionately affected any hospital. Medicare pays hospitals a per diem rate for early discharges when beneficiaries are transferred to another prospective payment system hospital or to postacute-care settings. This is based on the assumption that hospitals should not receive full payments for beneficiaries discharged early and then admitted for additional care in other clinical settings. OIG recommended that CMS change its regulations or pursue a legislative change, if necessary, to establish a hospital transfer payment policy for early discharges to hospice care. CMS stated that it would like to study the recommendations further.

Full report: http://oig.hhs.gov/oas/reports/region1/11200507.asp

Provider Data Often Inaccurate in Medicare Databases

In a report released May 28 by HHS's Office of the Inspector General (OIG), the agency found that provider data in two Medicare databases are often inaccurate and that Medicare Administrative Contractors (MACs) are ineffectively employing oversight. ''Inaccurate, incomplete, and inconsistent provider data coupled with insufficient oversight place the integrity of the Medicare program at risk and present vulnerabilities in all health care programs,'' OIG said. The report provided startling statistics, including that 48 percent of provider records in the National Plan and Provider Enumeration System (NPPES) and 58 percent of the provider records in the Provider Enrollment, Chain, and Ownership System (PECOS) contained inaccurate data. NPPES is used for providers to apply for the National Provider Identifier required for Medicare enrollment, and PECOS processes the provider enrollment applications; moreover, the report found data discrepancies between 97 percent of the records shared between PECOs and NPPES. OIG recommended that CMS issue guidance to MACs mandating that all provider data fields be verified in PECOS and NPPES. Other recommendations included considering automated provider screening tools in PECOS to verify NPPES data, monitoring NPPES applications by region to reduce fraud and offering an incentive structure for providers that fill out data accurately and completely. CMS agreed to all recommendations and said it is working to offer additional data verification for PECOS and NPPES. Full report: https://oig.hhs.gov/oei/reports/oei-07-09-00440.asp


Establishing Minimum National Standards and an Oversight Framework Would Help Ensure Quality and Safety of Advanced Diagnostic Imaging Services

According to a recent GAO report, CMS has not establish minimum national standards for the accreditation of suppliers of advanced diagnostic imaging (ADI) services, which cover the production of images for computed tomography, magnetic resonance imaging and nuclear medicine services. While CMS adopted the broad criteria from the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) for ADI accreditation, it relied on the three accrediting organizations it selected to establish their own standards for quality and safety. To establish a framework for assessing the ADI standards currently in use, GAO developed a list of nine standards based on recommendations from 11 organizations with imaging expertise from which GAO obtained information. Two of the three accrediting organizations that CMS selected use all nine standards, while the third organization uses six of the nine standards. To help ensure that ADI suppliers provide safe and high-quality imaging to Medicare beneficiaries, GAO recommends that the Administrator of CMS determine the content of and publish minimum national standards for the accreditation of ADI suppliers, develop an oversight framework for evaluating accrediting organization performance, develop more specific requirements for accrediting organization audits, and clarify guidance on immediate-jeopardy deficiencies. The Department of Health and Human Services, which oversees CMS, concurred with GAO's recommendations. Full report: http://www.gao.gov/products/GAO-13-246


Report Finds Hospital Readmissions Declined in 2012

The Centers for Medicare & Medicaid Services released a report entitled ''Medicare Readmission Rates Showed Meaningful Decline in 2012,'' which found that hospital readmission rates declined by 70,000 cases. From 2007 to 2011, rates averaged 19 percent, but in 2012, rates decreased to 18.4 percent. The CMS report did not speculate why the rates dropped, but said they have been instituting different initiatives to reduce readmission rates. These initiatives include increased reporting by hospitals on readmission rates, increased funding for Partnership for Patients program and altered payment policies through the Hospital Readmissions Reduction Program, among other things. The report also did not take into account demographic or risk profiles. The report did note that readmission rates are generally lower at smaller hospitals and higher at larger hospitals. View the report: http://www.cms.gov/Research-Statistics-Data-and-Systems/Research/MMRR/Downloads/MMRR2013_003_02_b01.pdf