Baker Tilly healthcare update February 10, 2015

At the agencies

On January 29 the Centers for Medicare and Medicaid (CMS) services announced in a blog post that the agency plans to propose a rule that would update the meaningful use program for electronic health records. In the blog post CMS indicates that they will reduce the 2015 reporting period from a year down to 90 days. CMS also indicated that they are considering moving the hospital reporting period away from a fiscal year model to a calendar year model, which is intended to give hospitals more time to incorporate updated electronic health records into their systems.

On February 4, the Food and Drug Administration (FDA) released draft guidance that included a simplified application for physicians to expedite the process of providing experimental drugs to their patients. The updated application was released as part of an effort to assist with the “expanded access program,” which is intended to provide greater ability for physicians to prescribe experimental drugs to treat serious or life-threatening conditions. The new form is estimated to take only 45 minutes to complete, compared to the previous form which reportedly took 100 hours to complete.

At the White House

On February 2, President Obama released his fiscal year 2016 budget which outlines his administration’s budget goals for the various programs and agencies throughout the federal government. The discretionary funding budget proposed for the Department of Health and Human Services (HHS) is $83.8 billion. The budget also outlines $350 billion in Medicare savings by modifying a number of programs including extending Medicaid drug rebates for low-income enrollees but increasing the income-related premiums under Medicare Parts B and D; reducing pay to off-campus hospital outpatient departments by setting their rates equal to rates in the Medicare Physician Fee Schedule or equal to rates for ambulatory surgical centers; reducing market-based rate updates for long-term care hospitals, home health facilities, and inpatient rehabilitation facilities by 1.1 percent each year from 2016-2025; reducing Medicare coverage of hospital reimbursements for uncompensated care (“bad debt”); and cutting funds to hospitals for graduate medical education. Since the HHS budget is so closely tied to the debate surrounding the Affordable Care Act (ACA), opposition to the president’s overall proposed budget is strong.

On the Hill

On February 3, the House passed a bill to repeal the ACA. The following day, Senators Orrin Hatch (R-UT) and Richard Burr (R-NC), along with Congressman Fred Upton (R-MI), released a replacement plan that would replace the ACA. Basic components of the plan include a repeal of the individual and employer mandates and tax credits for individuals who currently receive Medicaid to purchase private plans.

In the states

On January 28, a consortium of hospital groups, insurance advocates, unions, and public health experts filed briefs supporting premium tax credits in the federally-operated exchanges to the Supreme Court. The briefs were intended to show support for President Obama’s Administration in advance of the oral arguments for the King v. Burwell case that the Supreme Court will hear in March. The plaintiffs in the King v. Burwell case claim that Congress intended the tax subsidies under the ACA to be distributed only through the state-based exchanges. If the Court were to rule in their favor, that would disqualify the tax subsidies for up to approximately 10 million Americans who signed up for ACA plans using the federal exchange.

In the courts

On January 28, a consortium of hospital groups, insurance advocates, unions, and public health experts filed briefs supporting premium tax credits in the federally-operated exchanges to the Supreme Court. The briefs were intended to show support for President Obama’s Administration in advance of the oral arguments for the King v. Burwell case that the Supreme Court will hear in March. The plaintiffs in the King v. Burwell case claim that Congress intended the tax subsidies under the ACA to be distributed only through the state-based exchanges. If the Court were to rule in their favor, that would disqualify the tax subsidies for up to approximately 10 million Americans who signed up for ACA plans using the federal exchange.

For more information on this topic, or to learn how Baker Tilly healthcare specialists can help, contact our team.