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May 31, 2016

Health Headlines – May 31, 2016


FEATURE ARTICLES

House Ways and Means Approves Expanded Provider-Based Grandfathering Provision – On May 24, 2016, the U.S. House Ways and Means Committee approved legislation that would continue Hospital Outpatient Prospective Payment System (OPPS) payment for off-campus provider-based departments that were “mid-build” as of November 1, 2015.  Under the Bipartisan Budget Act of 2015 (BBA 2015), any facilities opening after November 1, 2015 will be paid the Physician Fee Schedule or Ambulatory Surgical Center payment rate and not the higher hospital OPPS rate starting in CY 2017.  If ultimately enacted, this new legislation would provide relief—i.e., OPPS payment rates—for departments already under construction when BBA 2015 was enacted, provided certain criteria are met.

Members of the Committee introduced the Helping Hospitals Improve Patient Care Act of 2016 (HHIPA) (H.R. 5273) on May 18, 2016, and it was quickly approved less than a week later with bipartisan support.  Without additional congressional intervention, any off-campus provider-based department that began billing after enactment of BBA 2015 is subject to reduced payment rates starting in CY 2017.

Under BBA 2015, off-campus departments billing under the OPPS on or before November 1, 2015 are grandfathered into the OPPS rate.  In addition, HHIPA directs CMS to grandfather certain additional provider-based departments into the OPPS rate starting January 1, 2018, provided that the following requirements are met:

  1. The CEO/COO attests its department was “mid-build” as of November 1, 2015.  HHIPA defines “mid-build” as “a binding written agreement with an outside unrelated party for the actual construction” of an off-campus department.

  2. The hospital submits a full provider-based attestation for the new department before December 31, 2016.

  3. The hospital includes the department as a practice location on the CMS-855A.

The full text of the bill is available here.  Additional details about HHIPA are available in the May 23, 2016 edition of Health Headlines, available here.

Reporter, Elizabeth N. Swayne, Washington, D.C., + 1 202 383 8932, eswayne@kslaw.com.

Ohio Prepares Medicaid Waiver Request – Ohio is preparing a Section 1115 Medicaid demonstration waiver application that, if approved, would require most of the members enrolled in Ohio’s Healthy Ohio Program to pay premiums and copayments for their health care coverage, a rarity among State Medicaid programs.  The centerpiece of the Healthy Ohio Program, as currently proposed, is the Buckeye Account, which is modeled after a health savings account. 

The Buckeye Account was designed to actively engage members in managing their healthcare expenses while exposing individuals to the costs of their care.  Under the proposal, both the state and the member would contribute dollars to the Buckeye Account.  The state-contributed dollars would be used to fund the plan deductibles, whereas the member-contributed funds would be used to pay for the member’s required copayments and qualified medically necessary services.  All members, except for pregnant women and individuals without income, would be required to contribute upfront monthly contributions equal to 2 percent  of income but not to exceed $99 per year (or $8.25 per month) into the Buckeye Account. 

If a member does not pay the required monthly payment within 60 days of the due date, the member will be disenrolled from the Healthy Ohio Program and required to pay back the debt before being eligible to re-enroll.  Most members in the Healthy Ohio Program will be required to pay copayments for services, which will be deducted from the member’s contribution amounts in his or her Buckeye Account.  If a member does not have contribution amounts remaining in his or her Buckeye Account, the copayment would be waived.  The Buckeye Account will also be used by members to collect incentive dollars earned for completing specific healthy behaviors, such as completing a smoking cessation program. 

The Healthy Ohio Program targets all Medicaid-eligible individuals aged 18 and older who qualify for Medicaid under certain eligibility categories.  If the individual is eligible for Medicaid based on those certain categories, the individual is required to be enrolled in the Healthy Ohio Program, even if the individual also qualifies for additional home and community based waiver services. 

Ohio estimates that the Healthy Ohio Program will save Ohio and the Federal government nearly $1 billion over the proposed five-year demonstration project.

The proposed implementation date for the Healthy Ohio Program is January 1, 2018.  A detailed summary of the Healthy Ohio Program is available here

Reporter, Kristin Roshelli, Houston +1 (713) 751-3263, kroshelli@kslaw.com.

ALSO IN THE NEWS

HHS Postpones Publication of Anticipated 340B Rules – HHS recently announced delays to several rules and policies related to the 340B Drug Pricing Program.  Policies postponed for later publication include the final 340B Omnibus Guidance, the Civil Monetary Penalties and Ceiling Price final rule, and the Administrative Dispute Resolution Process proposed rule.

Stakeholders have anticipated the release of the 340B Omnibus Guidance (also referred to as the “mega-guidance”) following litigation that invalidated previous rules related to the Program.   The omnibus guidance is expected to address and update a number of key policies, including defining eligible patients and provider sites that may receive these drugs, as well as the types of drugs that are available for discount.  The Health Resources and Services Administration (HRSA), which administers the 340B Program, now says the omnibus guidance will be available in December.

The other delayed rules, required by the Affordable Care Act, would allow OIG to demand civil monetary penalties from drug manufacturers that had intentionally overcharged hospitals and other covered entities for drugs used in the 340B Program, and establish an administrative dispute resolution process for covered entities involved in the Program.  Those rules are now slated to publish in November and September, respectively.

The Spring 2016 Regulatory Agenda, which provides a preview of regulations expected to publish during the final months of President Obama’s administration, published on May 18, 2016.  You can read the Spring 2016 Regulatory Agenda here.

HHS Explains There Are No Set Caps on Fees for Access to Medical Records – In a newly released FAQ, HHS clarified that there is no set limit under HIPAA for the fees that can be charged to patients for access to their medical records. A covered entity may calculate allowable fees by (1) calculating actual allowable costs, or (2) by using a schedule of costs based on average allowable labor costs. Alternatively, for electronic copies of records maintained electronically, covered entities may charge a flat fee not to exceed $6.50. HHS explained that this flat rate option is available for entities that do not want to go through the process of calculating actual or allowable costs. However, an entity may still charge a fee based on actual allowable costs—perhaps in response to an unusual request—provided that the entity informs the individual in advance of the approximate fee. Please click here to read the full FAQ.

CMS Announces New Initiatives to Reduce Hospital Readmissions – Last week, CMS announced the development of Hospital Improvement and Innovation Networks (HIINs), organizations intended to work collaboratively with quality improvement organizations (QIOs), hospital associations, and health systems to implement evidence-based best practices for quality improvement.  These HIINs are expected to build on the work of Hospital Engagement Networks (HENs) established under CMS’ Partnership for Patients initiative.  Through HIINS, CMS hopes to see a 20 percent reduction in overall patient harm and 12 percent reduction in 30-day hospital readmissions by 2019.  Find out more about the HIINS initiative here.  Organizations interested in supporting this effort can submit a proposal no later than June 27.

Watch Sessions of the King & Spalding Health Law and Policy Forum Online! – King & Spalding is pleased to share sessions from its Health Law and Policy Forum by video. These will be offered in coming weeks with individual registration and viewing opportunities.  In the first session, Hospital Consolidation Speeds Up, presenters share insights on recent key trends in consolidation transactions in healthcare and factors driving the trends; some common transaction structures for these investments; challenges occurring in acquisitions of distressed hospitals; future trends; and how to start the process of seeking a partner.   Find out more and register here

You're Invited! King & Spalding to Host Reception at AHLA Annual Meeting – Please join King & Spalding on June 28, 2016 from 5:30-7:30 p.m. in the Club Room of the Brown Palace Hotel during the AHLA Annual Meeting. Please RSVP by June 17 by clicking here. We hope to see you in Denver!