Last month the NOSORH Board of Directors voted to take action to contract with a new Legislative Liaison, Hall Render Associates, to provide guidance and support to the NOSORH Policy Committee and to work to increase appropriation for the State Office of Rural Health line and to seek reauthorization for the SORH line.  “We look forward to Hall Render leadership to help us accomplish our strategic priorities and appreciate the great expertise they bring to NOSORH,” according to Teryl Eisinger, Executive Director of NOSORH.  Hall Render will provide a policy update article each month.

Appropriations Debate Intensifies as Deadline Nears: 

Prior to the Thanksgiving break, House appropriators held listening sessions with various lawmakers on the fiscal 2016 Labor-HHS spending bill (H.R. 3020).  The House bill, along with its Senate counterpart (S. 1696), are annually the most contentious of the 12 spending appropriation spending bills, as they tend to be loaded up with partisan amendments.  The listening sessions are part of a broader effort by new House Speaker Paul Ryan to open up the process for developing agency spending measures ahead of the December 11 deadline to fund the federal government.

NOSORH advocacy counsel John Williams of Hall Render has learned through conversations with House Majority Leader Kevin McCarthy (R-CA) that the House intends to pass an omnibus spending bill and leave town for the year by December 11.  Currently the House and Senate are scheduled to be in session until December 18, but the Senate is also eying a departure date on or around December 11.  Should Congress fail to strike deals on some or all of the 12 appropriation bills that collectively fund the federal government, Congress would need to pass another continuing resolution (CR) or face a government shutdown.

In September, Congress passed a 10-week CR (PL 114-53) that provides funding at an annualized rate of $1.017 trillion. In late October, congressional leaders and the White House reached an agreement to raise discretionary spending caps (PL 112-25) by $80 billion over two years.  The cap increases ($50 billion in fiscal 2016 and $30 billion in fiscal 2017) were split evenly between defense and non-defense accounts.

Budget Act Impacts Off-Campus Hospital Outpatient Departments:

Included in the Bipartisan Budget Act of 2015 (H.R. 1314) that was signed into law on November 2 was a provision affecting Medicare coverage of services provided in off-campus hospital outpatient departments.  The measure stipulates that new provider based off-campus hospital outpatient departments (HOPDs) will no longer be eligible for reimbursements from CMS’ Outpatient Prospective Payment System (OPPS), but will continue to be eligible for reimbursements from either the Ambulatory Surgical Center payment system or the Medicare Physician Fee Schedule, which are generally lower than the OPPS.

Currently, Medicare pays for items and services provided in both on – and off-campus HOPDs as hospital services when those departments are in compliance with 42 CFR §413.65 (the Medicare “provider-based rule”).  With some limited exceptions, including Emergency Department services, applicable items and services furnished in off-campus HOPDs starting January 1, 2017, will be excluded from coverage as hospital outpatient services.  Specifically, the Budget Act does not include applicable items and services that are furnished on or after January 1, 2017, by an off-campus outpatient department of providers.  This means that only off-campus hospital departments billing for applicable services on the date of enactment (Nov. 2, 2015) will be grandfathered and able to receive Medicare payment as a hospital after January 1, 2017.

Efforts are ongoing to urge Congress to adopt an amendment that would grandfather hospitals, including safety-net hospitals, with an HOPD entity “under development.” One major hurdle for this effort to amend the language will be the cost of a legislative fix.  The HOPD provision was included in the budget legislation as an off-set to help pay for another provision that prevents a spike in Medicare beneficiary premiums.  This means that any future legislation grandfathering entities under development will have to be paid for which could cost upwards of a billion dollars.

Rural Health Care Bill Moves in Senate:  On November 18, the Senate Commerce Committee passed the Rural Health Care connectivity Act of 2015 (S. 1916).  This bill would amend the Communications Act to permit skilled nursing facilities (SNF) to apply for support from the Universal Service Fund’s (USF) Rural Health Care Program (RHCP).  The USF’s RHCP provides funding for telecommunications and broadband services.  The Communications Act specifies which types of health care providers are eligible to receive RHCP support and SNFs are currently not included.

When the FCC updated the RHCP and created the Healthcare Connect Fund in 2012, it proposed implementing a pilot program to examine SNF funding.  In January 2014, the FCC deferred implementation of the pilot program, claiming it needed additional statutory authority to allow SNFs to be eligible. This legislation, which now moves to the full Senate for consideration, would provide such authority.


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