Congress Passes Spending Bill

On December 18, the House and Senate overwhelmingly passed the omnibus spending bill.  Prior to midnight on December 15, the House revealed the details of the FY16 omnibus appropriations package, which funds the federal agencies and programs through September 30, 2016.  The White House has indicated it intends to sign the bill (H.R. 2029) into law. 

The package did not include a proposal to exempt off-campus outpatient facilities that are under development from the Medicare site-neutral pay cuts.  The two-year budget law that passed in October included a provision to pay physicians rates to physician practices that hospitals purchase and turn into outpatient facilities.  It applies to all off-campus outpatient facilities that were not billing Medicare as of November 2, but the pay cuts don't take effect until January 1, 2017.

Among other health care-related provisions, the bill would increase by $30 million for Children's Hospitals Graduate Medical Education, $4.5 million for rural health outreach grants and $2.1 million for rural telehealth.  It provides a $2-billion increase for NIH funding and $160 million for the Preventive Health & Health Services Block Grant, which allows each state to address its most critical public needs.

In addition to the omnibus, a bipartisan package of Medicare changes is being expedited through the Senate "hotline" process.  Among other provisions, the Patient Access and Medicare Protection Act by Sens. Rob Portman (R-OH) and John Casey (D-PA) would allow CMS to grant a blanket meaningful use hardship exemption for 2015 and include a one-year delay in applying Medicare competitive bid pricing to complex rehab accessories.  Under the hotline process, each senator can object to the bill, and if no holds are put on the measure, it is deemed passed by the Senate and will be sent to the House.  The House is expected to take up the Medicare bill in January.

House to Resume Hospital Payment Reform in 2016

The House Ways and Means Chairman has indicated it will resume work on hospital payment reform legislation when Congress returns in January. Several members of that committee have introduced bills to reform hospital payments, such as creating lump sum payments for IME and DSH, that would be made part of a larger legislative package that includes other payment changes, many of which are likely to result in cuts to hospital reimbursement. The measure is also expected to include a provision that would restore higher payment rates for those hospitals that had outpatient departments "under development" at the time President Obama signed budget legislation into law last month and a provision to limit penalties for technical violations of the Stark Law that is backed by the Hall Render Stark Law Correction Coalition.

MedPAC Makes Recommendations for 2017 Reimbursement Rates

On December 11, the Medicare Payment Advisory Commission ("MedPAC") hosted a meeting to discuss the panel's recommendations for updating Medicare reimbursements for a number of medical facilities in 2017. MedPAC announced that it does not support increasing payments for inpatient rehabilitation facilities, long-term care hospitals and home health agencies, which commissioners determined are profitable, have sufficient access to capital and are in adequate supply to care for Medicare beneficiaries.

MedPAC staff indicated that the number of inpatient rehabilitation facilities ("IRFs") remained stable in 2014 and that 79 percent were hospital-based. In March 2015, the commission released a report to Congress that also recommended no update to IRF Medicare payment rates for 2016. However, the Centers for Medicare & Medicaid Services ("CMS") increased IRF reimbursement by 1.8 percent in its 2016 IRF prospective payment final rule.

The commission also recommended that long-term care hospitals ("LTCHs"), which must have average lengths of stay of more than 25 days for Medicare beneficiaries, receive no increase in 2017 Medicare payments. CMS reported in July 2015 that LTCHs will see a 4.6 percent decrease in Medicare payments in 2016.

In addition to its recommendations for IRFs, LTCHs and HHAs, MedPAC indicated that it does not support payment rate updates for ambulatory surgical centers ("ASCs") and proposed that Congress require ASCs to submit cost data.

CMS Announces NOTICE Act Town Hall

On December 21, CMS will host a tele-town hall meeting to solicit input regarding CMS's implementation of the Notice Observation Treatment and Implication for Care Eligibility Act ("NOTICE Act") requirements.  Congress passed the NOTICE Act earlier this year requiring hospitals and critical access hospitals to provide notification to Medicare beneficiaries receiving observation services as outpatients for more than 24 hours at such hospitals and critical access hospitals.

To submit comments, please send emails to:  [email protected].  The dial-in number is: 1-800-837-1935 and the Conference ID is: 5106309.

Health-Care Related Bills Introduced This Week

Sen. Al Franken (D-MN) reintroduced the Nurse and Health Care Worker Protection Act.  The bill (S. 2408) seeks to forbid nurses from manually lifting patients and establish other Occupational Safety and Health Administration ("OSHA") standards for hospitals. The legislation follows an OSHA memo from earlier this year that laid out new ways that U.S. Department of Labor inspectors can help ensure hospitals are protecting worker safety.

Sen. Ron Wyden (D-OR), who is the ranking member of the Senate Finance Committee, introduced a bill that amends Titles XVIII and XIX of the Social Security Act to improve payments for hospital outpatient department services and complex rehabilitation technology.  A companion measure (H.R. 4273) was introduced in the House by Rep. Gene Green (D-TX).

Two mental health related bills were introduced this week.  Rep. Kristi Noem (R-SD) introduced a bill (H.R. 4277) that would amend title XVIII of the Social Security Act to provide for treatment of clinical psychologists as physicians for purposes of furnishing clinical psychologist services under the Medicare program.  Additionally, Rep. Joe Kennedy (D-MA) introduced a bill (H.R. 4276) aimed at strengthening parity in mental health and substance use disorder benefits.

Next Week in Washington

With Congress passing the omnibus and tax extenders package, their work is done for 2015.  The House returns on January 5, 2016 while the Senate is scheduled to return on January 11, 2015.  Therefore, the next This Week in Washington will be published on January 8.  Happy Holidays!