Tag: Providers

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Medicaid-to-Medicare reimbursement ratio nears pre-Great Recession level

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A look into Medicaid participation by urologists reveals differences in managed care vs fee for service and across states.

 
 

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

A 2017 survey found approximately 75% of urologists accepted Medicaid managed care and 90% accepted Medicare Advantage, “suggesting some discernment when it comes including Medicaid managed care in a practice’s payment mix,” writes Ross E. Weber of the AACU.

 
 

Based on a partnership with Urology Times, articles from the American Association of Clinical Urologists (AACU) provide updates on legislative processes and issues affecting urologists. We welcome your comments and suggestions. Contact the AACU government affairs office at 847-517-1050 or info@aacuweb.org for more information.

Having contributed health policy updates to Urology Times® for more than 10 years, a decade-long search of the AACU’s archive yields only 1 headline that references Medicaid. In November 2014, when provisions of the Affordable Care Act related to Medicaid expansion were only 10 months old, the AACU addressed the pressure applied by state hospital associations for lawmakers to broaden eligibility requirements for their health care safety net programs. At the time, 25 states and the District of Columbia had approved laws to that end. Now, 7 years later, that number has increased to 38 states and the District of Columbia. This reminiscence is noteworthy in light of a recent report on the Medicaid-to-Medicare reimbursement ratio and statistics on Medicaid patients’ access to urological care.

On February 1, the journal Health Affairs published the latest results of an examination of Medicaid and Medicare physician fees dating back nearly 30 years. The authors, led by the Urban Institute’s Stephen Zuckerman, reported that Medicaid physician fees averaged 78% of Medicare physician fees for common non-primary care, non-obstetric procedures in 2019.

For all the tracked procedures, the Medicaid-to-Medicare fee index reached 0.72 in 2019, up from 0.66 in 2012 and very near the 2008, pre-Great Recession, ratio of 0.75. The study’s authors went on to relate these figures to physician practice patterns and public policy.

“Historically, low Medicaid fees have limited physicians’ participation in the program,” they wrote. Continuing, they expressed concern that Medicaid buy-in proposals in several states, “would pay physicians according to the state’s Medicaid fee schedule or negotiate a new fee schedule with those fees as a starting point. This approach would keep costs low but could limit physicians’ willingness to accept the new coverage.”

The 2017 American Urological Association (AUA) Census only barely bears out this claim. Medicaid covers about 1 and 5 people living in the United States, totaling approximately 40 million adults and 31 million children. Sixty-nine percent of those beneficiaries are enrolled in managed care plans and, according to the 2017 AUA Census, nearly 75% of urologists accept Medicaid managed care plans. That would seem to suggest that there isn’t a widespread lack of access to urologic care. Having said that, the same AUA survey finds 90% of urologists accept Medicare Advantage, thus suggesting some discernment when it comes to including Medicaid managed care in a practice’s payment mix.

A smaller study of urological surgeons indicates a bit more selectivity. Six hundred and fifty urologists surveyed by Overholser et al found 58.3% accepted some or all Medicaid insurance plans. Drilling down to individual states, the 2016 Overholser study reported the percentage of urologists accepting Medicaid varied by state, ranging from 10% to 90%.

That considerable variance in provider participation is not surprising given the sizable difference in physician fees state by state. According to Zuckerman’s 2017 report, Alaska and Montana Medicaid reimbursement is 126% of Medicare and 109% of Medicare, respectively, whereas Rhode Island and New Jersey meagerly reimburse physicians at 38% and 42% of the Medicare rate.

Florida urologist Kevin Lee, MD, FACS, takes Medicaid in his private practice and finds, “Some of us don’t mind the lower payments. The bigger problem, though, is the cost of oncological meds. Reimbursement for those therapies is always much lower than the price we paid in advance.”

Upon taking office, President Biden took steps to, in his way of thinking, support the Medicaid program. Many experts expect the Biden administration to reverse several of his predecessor’s policies, including block grant funding and work requirements. Jocelyn Guyer, managing director at Manatt Health, the firm where President Biden’s Centers for Medicare & Medicaid Services Administrator appointee most recently worked, is quoted by HealthPayerIntelligence as saying, “The administration is sending an incredibly powerful signal about where they’re heading on Medicaid policy and a return to viewing Medicaid as a key, foundational piece of the Affordable Care Act and a primary vehicle for coverage for people, particularly during the pandemic.”

 
 

 
 

Clipped from: https://www.urologytimes.com/view/medicaid-to-medicare-reimbursement-ratio-nears-pre-great-recession-level

 
 

 
 

 
 

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Congress Delays Medicaid DSH Cuts, Makes Targeted Medicaid Policy Changes | Manatt, Phelps & Phillips, LLP – JDSupra

 
 

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The latest COVID relief bill also delays DSH reductions another 4 years (they have been continuously delayed for more than 10 years now).

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

In late December, following several weeks of dynamic negotiations, Congress passed the Consolidated Appropriations Act, 2021 (the Act).1 The massive legislative package includes appropriations through September 30, 2021, $900 billion in supplemental appropriations to address COVID-19, a ban on surprise billing, extensions of expiring health programs and an amalgam of odds-and-ends health policy provisions.

The Act contains several key Medicaid provisions, including a delay in Medicaid Disproportionate Share Hospital (DSH) allotment reductions, new Medicaid supplemental payment reporting requirements for states and codification of non-emergency medical transportation (NEMT) rules, described below.

But despite the vastness of the legislation, key Medicaid priorities were not included. States and other stakeholders have been lobbying Congress to increase the Medicaid enhanced matching rate that applies to medical expenditures for the duration of the public health emergency (PHE) and extend it beyond the duration of the PHE. This COVID-19 relief provision and other Medicaid proposals, such as a proposal to extend Medicaid coverage of postpartum women eligible for Medicaid on the basis of their pregnancy, will be high priorities for Democrats as they work with the incoming Biden administration to secure a fifth round of COVID-19 stimulus funding early this year.

DSH and Supplemental Payment Reporting Requirements

Delay in Medicaid DSH Allotment Reductions. The Act eliminates reductions in Medicaid DSH allotments—that is, the cap on federal match for state Medicaid DSH expenditures—in fiscal year (FY) 2021. It also delays the remaining four years of cuts until FY 2024, as shown in Figure 1 below.

Figure 1. Change in Medicaid DSH Allotment Reductions

  

FY 2021

FY 2022

FY 2023

FY 2024

FY 2025

FY 2026

FY 2027

Previous Reduction Amounts

$4 billion2

$8
billion

$8
billion

$8
billion

$8
billion

–

–

Modified Reduction Amounts

–

–

–

$8
billion

$8
billion

$8
billion

$8
billion

 
 

Changes to Calculation of Hospital-Specific DSH Limit. The Act also modifies the maximum amount of Medicaid DSH payments an individual hospital may receive, by redefining what costs are included when calculating hospital-specific DSH limits. States’ DSH payments to individual hospitals may not exceed a hospital’s uncompensated care costs for uninsured patients and Medicaid-enrolled patients. The second component—uncompensated care costs for Medicaid-enrolled patients—is the difference between the costs of services provided and payments received from Medicaid, and is referred to as the Medicaid shortfall.

Department of Health and Human Services (HHS) guidance and rulemaking regarding how hospitals calculate Medicaid shortfall for DSH purposes have been contentious and led to a litany of lawsuits. The issue at hand is how to account for Medicaid enrollees who have another source of coverage, such as Medicare or commercial insurance, when calculating Medicaid shortfall. Although HHS policy has been that states must account for all third-party payments when calculating hospital-specific DSH limits, some hospitals have argued that only Medicaid payments should count against the hospital-specific DSH limit.

Congress adopts an entirely different method for calculating Medicaid shortfall, as recommended by the Medicaid and CHIP Payment and Access Commission (MACPAC). Rather than focus on whether payments for individuals with third-party coverage should count in the hospital-specific DSH limit calculation, the Act simply omits from the calculation all costs for Medicaid-eligible patients with third-party sources of coverage where the third-party source of coverage is the primary payer. As a result, hospitals that treat high volumes of patients with Medicaid and third-party coverage (such as children’s hospitals that treat neonates, who commonly are covered by commercial insurance and Medicaid, or hospitals serving large numbers of dual eligibles) may report less Medicaid shortfall. And because many states use hospitals’ uncompensated care amounts to distribute DSH payments among hospitals, this change is likely to impact the distribution of Medicaid DSH payments among hospitals in certain states.

Supplemental Payment Reporting Requirements. The Act imposes new requirements on states to report any supplemental payments made through their Medicaid programs. By October 1, 2021, HHS must establish a system for states to submit reports on supplemental payment data as a requirement for a State Plan Amendment that would provide for a supplemental payment. In their reports, states will be required to explain, among other elements, (1) how supplemental payments are in keeping with the Social Security Act’s mandate that Medicaid payments be consistent with “efficiency, economy, quality of care, and access,” as well as with the purpose of the supplemental payment; (2) the criteria used to determine which providers qualify for a supplemental payment; (3) the methodology used to distribute the supplemental payments; and (4) the amount of supplemental payments made to each provider.3

Supplemental payments will continue to be a hot-button issue for many federal policymakers and increased transparency through required reporting may fuel future policy changes.

Other Medicaid Provisions

The Act includes several other Medicaid policies including:

  • Codification of NEMT Requirements. The Act requires states to provide NEMT to Medicaid beneficiaries who lack access to regular transportation (including those enrolled in benchmark and benchmark equivalent coverage). Previously, the requirement existed only in regulation, and the Trump administration had threatened to eliminate it. In making NEMT a mandatory benefit through statute, Congress also establishes some guardrails around the new benefit, namely by including NEMT provider requirements and by directing that the Medicaid state plan provide for methods and procedures to prevent unnecessary utilization and to ensure that payments are consistent with efficiency, economy, and quality of care and sufficient to promote access. The Act directs the Government Accountability Office to study NEMT services, with a particular focus on preventing and detecting fraud and abuse. The legislation also requires CMS to report Transformed Medicaid Statistical Information System data to Congress along with recommendations regarding coverage of NEMT to medically necessary services; to convene a series of stakeholder meetings to discuss best practices for improving Medicaid program integrity related to NEMT; and to review and update, as necessary, CMS guidance to states about designing and administering NEMT coverage. Finally, the legislation authorizes states that utilize NEMT brokerage programs, as permitted under Section 1902(a)(70), to consult stakeholders in establishing their programs.
  • Eligibility Restoration for Citizens of Freely Associated States. The Act eliminates the five-year bar on Medicaid eligibility for citizens of the freely associated states (i.e., Micronesia, Marshall Islands, and Palau) who are legally residing in the United States. The legislation restores access to Medicaid for this population after a drafting error in the 1996 Personal Responsibility and Work Opportunity Reconciliation Act excluded them from coverage.
  • Medicaid Extenders. The Act includes funding through FY 2023 for the Money Follows the Person Rebalancing Demonstration, which helps states rebalance utilization and spending toward home- and community-based services (HCBS) rather than institutional care; spousal impoverishment protections, which allow states to disregard individuals’ spousal income and assets when determining eligibility for Medicaid HCBS; and the community mental health services demonstration program, which provides eight states with enhanced funding to improve behavioral health services through Certified Community Behavioral Health Clinics.

1 P.L. 116-260.

2 Beginning in December 2020.

3 The Act indicates in what appears to be a drafting error that each state’s report must provide an assurance that the total payments made to an inpatient hospital provider (but excluding DSH payments) do not exceed the upper payment limit (UPL). However, there is no hospital-specific cap on supplemental payments subject to the UPL; rather, the UPL is assessed at an aggregate level for defined classes of providers (which is established in statute). Congress and/or the Centers for Medicare & Medicaid Services (CMS) may seek to clarify this provision.

 
 

Clipped from: https://www.jdsupra.com/legalnews/congress-delays-medicaid-dsh-cuts-makes-8125523/

 
 

 
 

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The Centers for Medicare & Medicaid Services Could Improve Its Wage Index Adjustment for Hospitals in Areas With the Lowest Wages A-01-20-00502 12-30-2020

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A recent CMS audit of wages paid in hospitals will likely be used to increase the wage index used for rural hospital reimbursement.

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

12-30-2020 | A-01-20-00502 | Complete Report

Why We Did This Audit

The Centers for Medicare & Medicaid Services (CMS) has characterized its bottom quartile wage index adjustment as a way to increase the accuracy of the hospital wage index system. We are issuing this data brief because wage index accuracy is essential to the primary objective of the inpatient and outpatient prospective payment systems (IPPS and OPPS), which is to create incentives for hospitals to operate efficiently, while ensuring that payments are adequate to compensate hospitals for the reasonable costs of high-quality, necessary care. If hospitals are undercompensated because of inaccurate wage indexes, that puts them under financial stress, which could lead to a variety of adverse outcomes, up to and including closure.

The objective of this audit is to analyze certain characteristics of the hospitals with area wage indexes (AWIs) in the bottom quartile for 2020 to provide information to CMS and other stakeholders during the implementation of CMS’s bottom quartile wage index adjustment. We are providing the results of this audit in the form of a data brief to best present our results at this stage in the anticipated 4-year period during which CMS plans to adjust the wage indexes in the bottom quartile.

What Is an Area Wage Index? What Is “Circularity”?

CMS calculates AWIs annually and uses those AWIs to adjust Medicare standard payments to hospitals in the inpatient and outpatient prospective payment systems to reflect the prices hospitals face in their local labor markets. Researchers and stakeholders use the term “circularity” to refer to the fact that CMS calculates the current year’s AWIs based on wage data submitted by hospitals in their Medicare cost reports. Those wage data are approximately 4 years old when used by CMS to calculate wage indexes. Critics of circularity (or rather of circularity combined with that 4-year time lag) assert that it can prevent some hospitals from raising wages.

What Is the Bottom Quartile Wage Index Adjustment?

For 2020 (Federal fiscal year (FFY) for inpatient claims and calendar year for outpatient claims), CMS raised AWIs in the bottom quartile (the lowest 25 percent) to bring them closer to the 25th percentile wage index. CMS did this because, in its opinion, the wage index system had previously been perpetuating and exacerbating low wage indexes because of circularity combined with the 4-year time lag, as described above. Accordingly, CMS has stated that it intends to employ this new tactic of raising the wage indexes in the bottom quartile each year for at least 4 years, with the expectation that the hospitals in the bottom quartile will use the opportunity afforded by higher Medicare payments to raise wages.

We Found That:

  • Of rural hospitals in the IPPS, 55 percent had wage indexes in the bottom quartile for FFY 2020.
  • Of bottom quartile hospitals, 53 percent were rural.
  • Bottom quartile hospitals tended to be smaller and lower-volume hospitals.
  • Bottom quartile hospitals were located in 24 States overall, but 41 percent of bottom quartile hospitals were located in just 6 States.
  • Most States that did not expand Medicaid under the provisions of the Affordable Care Act had hospitals in the bottom quartile.
  • Most States with hospitals in the bottom quartile had the lowest possible State minimum wage.
  • The profit margins of hospitals in the bottom quartile varied significantly.
  • The average hourly wages of hospitals in the same area sometimes varied significantly. (That is, some hospitals already were paying significantly higher wages than other hospitals in the same area prior to the bottom quartile wage index adjustment.)

Key Take-Away

When post-pandemic conditions allow for new initiatives, CMS could consider focusing the bottom quartile wage index adjustment more precisely toward the hospitals that are the least able to raise wages without that adjustment. Those hospitals are the ones with low or negative profit margins rather than higher, positive profit margins. CMS could also consider studying the question of why some hospitals in a particular area were able to pay higher wages than other hospitals in the same area prior to the implementation of the bottom quartile wage index adjustment. More information might enable CMS to focus the adjustment even more precisely.

Filed under: Centers for Medicare and Medicaid Services

6:54 AM

Clipped from: https://oig.hhs.gov/oas/reports/region1/12000502.asp


 

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Larry Hogan announces that Medicaid reimbursement increases will go into effect January 1

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Maryland will begin paying BH and LTC providers more January 1 via a rate increase of 3.5% and 4%, respectively.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

 
 

 
 

 
 

Clipped from: https://stateofreform.com/featured/2020/12/60078/

Behavioral health and long-term care Medicaid reimbursement rate increases are set to go into effect on Jan. 1.. They were initially set to go into effect on July 1. The rate increases were passed through legislation in 2019.

Governor Larry Hogan announced the change on Thursday. Reimbursement rates will affect private health care providers who provide services to Marylanders on Medicaid.

 
 

 
 

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The changes to long-term care reimbursement will include nursing facilities, Rare and Expensive Case Management (REM), Development Disabilities Administration (DDA) targeted case management for certain individuals and private duty nursing. The Medicaid reimbursement rate for each will increase by 4 percent.

Behavioral health programs included in the bill will see a 3.5 percent increase in reimbursement. This includes behavioral analysis, adult residential and community-based substance use disorder treatment (SUD), mental health services, behavioral health targeted case management for children and adults, the 1915i community-based services program and therapeutic behavioral services.

The costs associated with the changes will be split between the state’s general funds and federal Medicaid funding.

 
 

 
 

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Nursing Home Providers Sue for Access to $153M in COVID-19 Medicaid Rate Boosts – Skilled Nursing News

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

Curator summary

 

PA nursing homes argue that the provider taxes they pay (“assessments”) allowed the state to draw down $153M extra federal funds as part of COVID relief- but the nursing homes did not get any of the extra funds.

 
 

 
 

 
 

Clipped from: https://skillednursingnews.com/2020/12/nursing-home-providers-sue-for-access-to-153m-in-covid-19-medicaid-rate-boosts/

Three senior living and care organizations in Pennsylvania filed suit against the state over $153 million in additional Medicaid funds allocated in response to the COVID-19 pandemic, charging the Keystone State with treating the money “as its own piggybank and disregarding the substantial need of the Commonwealth’s most vulnerable citizens.”

The petition, filed on December 7 in the Commonwealth Court of Pennsylvania, argues that the state is failing to comply with a statutory obligation to distribute Medicaid funds received from the federal government to nursing facilities.

According to the provider associations — the Pennsylvania Health Care Association (PHCA), LeadingAge PA, and the Pennsylvania Coalition of Affiliated Healthcare & Living Communities (PACAH) — the assessments paid by their nursing facility members contributed to an increase in the Medicaid funds that Pennsylvania received.

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Medicaid is funded by both states and the federal government, with the federal government’s matching share varying by state depending on per capita income. In Pennsylvania, the state makes use of provider assessments, or taxes, that bolster the state share of Medicaid and in turn increase the amount of federal Medicaid dollars that the state can draw down.

In March, the Families First Coronavirus Response Act increased the federal government’s share of Medicaid expenses, or the Federal Medical Assistance Percentage (FMAP), by 6.2 percentage points.

The Pennsylvania providers argue that under Pennsylvania’s Assessment Law, the state Department of Human Services is required to establish “a restricted account in the General Fund for the receipt and deposit of moneys from the assessment [and] any Federal financial participation received by the Commonwealth as a direct result of the assessment.”

The funds that go into this restricted account should be put in some way toward assistance for nursing facility providers, the lawsuit argues. And because of the FMAP increase passed in March, the provider assessments contributed to more federal dollars being drawn down for Medicaid, the groups claimed in the petition.

Specifically, the increased FMAP from provider assessments will lead to “an additional $153 million in funds for Medicaid payments to nursing facilities for 2020 alone,” according to the petition.

The suit argues that the Assessment Law requires the Department of Human Services to distribute all funds from the federal government “as a result of the assessments to the nursing facilities,” but it has not agreed to use the Enhanced FMAP funds for supplemental payments to nursing facilities.

“Instead of using the Enhanced FMAP funds to provide additional payments to the notoriously underfunded nursing facilities caring for Medicaid recipients, the Department is playing a shell game — it is using the Enhanced FMAP funds in lieu of other payments that were already appropriated to the nursing facilities and using those funds to fill budget holes for other programs,” the petition reads.

PHCA president and CEO Zach Shamberg described the lawsuit as “our last resort,” telling Skilled Nursing News on Tuesday that providers have been negotiating with the Department of Human Services since spring on the destination of the enhanced FMAP funds.

“We’re on month eight of those negotiations, and still no dollars have been sent to long-term care providers,” he said. “So this was really our last resort, our last recourse, getting these dollars to where they needed to go.”

The Department of Human Services did not agree.

“This lawsuit seeks only more money for nursing facilities throughout the commonwealth that have already received more than $800 million in taxpayer stimulus,” it said in a statement sent to SNN. “The assertions made in the materials the associations distributed to the media are simply false. The money at issue is being used to support residents of our nursing facilities.”