Each third Tuesday of the month at 2:00 pm ET the Policy Committee meets to discuss recent legislative and regulatory updates. A copy of the regulatory briefing is available here. The top 3 issues on the regulatory front this month include:

  • CMS is now accepting applications from clinicians eligible for the Merit-based Incentive Payment System (MIPS) to obtain hardship exceptions from the Advancing Care Information (i.e., Meaningful Use) requirements of the program.
  • Two rural-related legislative provisions, the Medicare-Dependent Hospital (MDH) program and the Low-Volume Hospital (LVH) payment adjustment, will expire on October 1, 2017 as discussed in the FY 2018 Medicare Hospital Inpatient Prospective Payment System (IPPS) final rule.
  • CMS is deemphasizing review of CAH 96-hour certification requirement, which is also discussed in the IPPS final rule.

Leadership from several SORH and NOSORH have been invited to attend a Senate Democratic Rural Summit in mid-September to provide input to Congressional members and to learn more about rural health.

The following update was provided for our members by Hall Render, NOSORH Legislative Liaison:

Fiscal Year 2018 Appropriations Update
In late July, House Appropriators passed their funding proposal for the Labor-HHS-Education fiscal year (FY) 2018 spending bill. The bill includes a total of $77.6 billion for HHS, a decrease of $542 million below the FY 2017 enacted level, but $14.5 billion above the President’s budget request.

The committee funded the Health Resources and Services Administration (HRSA) at $5.8 billion, which is almost $400 million below the FY 2017 level. Within the HRSA account, the committee provided level funding for rural health programs in FY 2018, which included funding the State Office of Rural Health program at $10,000,000 and the Rural Hospital Flexibility Grants at $43,609,000 for FY 2018. Level funding was also provided for telehealth at $18.5 million. Within the report language, the committee encouraged HHS to establish a Telehealth Center of Excellence to test the efficacy of telehealth services in both urban and rural geographic areas.

The Senate is working on a slower timeline as the Senate Labor-HHS subcommittee has yet to introduce or markup its FY 2018 bill. Of the various spending bills, the Labor-HHS bill is almost always the most difficult for Congress to pass due to partisan policy riders and spending levels.

Upon returning to Washington on September 5, the House and Senate will have 12 and 17 legislative days respectively to deal with funding the federal government which expires on September 30. The slower Senate pace will most likely lead to a continuing resolution and the Labor-HHS funding bill being wrapped into an omnibus spending package which many are estimating will be finalized in November or December.

Senate Votes Down ACA Repeal Attempt
Prior to the Senate departing for the August recess, the Senate voted down (49-51) a last-ditch effort by Senate Republican leadership to repeal the ACA. Republican leadership and the White House were hoping to pass a “skinny” ACA repeal bill that would have eliminated the individual mandate and blocked the employer mandate for eight years.

The bill would have also increased the limit on health savings accounts contributions, extended the moratorium on the medical device tax, made changes to the 1332 waiver program, and added $422 million for community health centers. The Congressional Budget Office estimated that the bill would save $178 billion over the next decade. However, it was unclear if the House and Senate would have reconciled the differences in conference to vote out a single bill.

With the defeat, Senate Majority Leader McConnell (R-KY) indicated he would be open to working with Democrats on reforms beyond just stabilizing the ACA marketplace. The Senate’s health committee will hold two hearings on stabilizing the ACA’s insurance markets in early September, as the committee attempts to craft a bipartisan health reform package. The hearings will feature testimony from state insurance commissioners and governors on how to tamp down premiums and increase insurance options in the ACA markets for 2018.

House Examines 340B Program
On July 19, the House Energy and Commerce Oversight Subcommittee held a hearing on the 340B program. While members expressed the importance of the 340B program, the committee highlighted concerns with the program, specifically: (1) the growth of 340B far exceeding HRSA’s limited oversight; (2) HRSA’s oversight reveals high levels of non-compliance; (3) hospitals receiving duplicate discounts; (4) hospitals diverting 340B drugs to ineligible patients; and (5) covered entities are not maintaining 340B databases.

Many members called for program integrity reforms for 340B. Additionally, some members were critical of CMS’s proposed Hospital Outpatient rule from July 14. In the rule, CMS is proposing to change the payment rate for certain Medicare Part B drugs purchased by hospitals through 340B at the average sales price minus 22.5 percent, rather than average sales price plus 6 percent. See the CMS fact sheet detailing the OPPS rule from July.

Rural Health Related Bills Recently Introduced
Rep. Cathy McMorris Rodgers (R-WA) introduced a bill (H.R. 3394) that would reauthorize for three years, 340H of the Public Health Service Act to encourage the expansion, maintenance, and establishment of approved graduate medical residency programs at qualified teaching health centers.

Rep. Bill Johnson (R-OH) introduced the Evidence-Based Telehealth Expansion Act of 2017. The bill (H.R. 3482) would allow the HHS Secretary to review existing services in the Medicare program to determine which are appropriate for telehealth, and waive existing restrictions on those services.

Rep. Jeff Denham (R-CA) introduced the Teaching Health Center Graduate Medical Education Program.  The bill (H.R. 3451) funds 240 new resident spots and would establish a minimum of 10 new residency centers. It also directs the HHS Secretary to prioritize centers located in counties with higher than 35 percent of the population enrolled in Medicaid.

Rep. Gregg Harper (R-MS) introduced a bill (H.R. 3224) that would amend title XVIII of the Social Security Act to clarify reasonable costs for critical access hospital payments under Medicare.

Rep. Lynn Jenkins (R-KS) introduced a bill (H.R. 3331) that would amend title XI of the Social Security Act to promote testing of incentive payments for behavioral health providers for adoption and use of certified electronic health record technology.

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