The NOSORH Policy Committee asks that all SORH and their partners reach out to their members on appropriations. NOSORH is seeking an increase in appropriations for the SORH line to $12.5 million to match the SORH authorization language. Please check in with your members of the appropriations committee to ensure their support of increased appropriation, determine the deadline for any requested submission and ask for their support. Please contact Andrew Coats, Legislative Liaison, if you need assistance or with any questions.
President Releases Fiscal Year 2020 Budget Proposal
On March 11, President Trump released his administration’s fiscal year 2020 budget. As it goes for every presidential budget, the proposal stands zero chance of being implemented in its entirety. The condensed version of the budget can be found here.
The Health Resources and Services Administration’s (HRSA) budget request does not request funding for the Rural Hospital Flexibility program, State Office of Rural Health, and the Rural Residency Planning and Development. The lack of the funding has been consistent with HRSA budget requests in recent years. With Congress passing into law the Reauthorization of the SORH program at the end of the 2018, we remain hopeful that Congress will fund the SORH line as called for in recent law.
Other health care priorities include:
Medicaid: The budget calls for trillions in cuts to the growth of Medicaid (and Medicare). The administration is seeking to overhaul Medicaid through block grant funding. By implementing block grant or per capita caps, this would cut $1.5 trillion over 10 years in Medicaid spending.
340B: The budget also calls for giving HRSA more control over 340B by asking for “broad regulatory authority for 340B to set enforceable standards of program participation.” The budget requests Congress require hospitals to report their 340B savings and explain how the money is used. This was included in last year’s budget, and there were a couple bills introduced last Congress mirroring this. If Republicans couldn’t move this last year, there is little chance in the new Congress.
Bad Debt and Uncompensated Care: The budget calls for bringing “transparency to several Medicare payments to hospitals.” The proposal calls for reducing the reimbursement for bad debt from 65 percent to 25 percent over three years starting in fiscal year 2021. Rural hospitals with fewer than 50 beds, critical access hospitals, rural health clinics and FQHCs would be exempt. The budget also proposes to cut uncompensated care payments. Starting in fiscal year 2021, uncompensated care payments would be made to hospitals based on their share of charity care and non-Medicare bad debt, as included on their Medicare cost-reports. The bad debt proposal would save $38.5 billion over 10 years and the uncompensated care proposal would save $98 billion over 10 years.
Others: Another hospital-related proposal of note would consolidate the Hospital Value-Based Purchasing Program, Hospital-Acquired Condition Reduction Program and Hospital Readmissions Reduction Program into a single program.
House Democrats Unveil Single-Payor Legislation
House Democrats introduced sweeping “Medicare for All” legislation, providing the most detailed plan to overhaul the current healthcare system by enrolling all U.S. residents in a single-payer, government-run health plan. It would cover a more expansive set of benefits than the current Medicare program and restructure payment for institutional healthcare providers such as hospitals and skilled nursing facilities. The measure does not include a price tag or specific proposals for financing the new system, which analysts estimate would cost tens of trillions of dollars over a decade. The lead sponsor, Rep. Pramila Jayapal (D-WA), said she will release a separate list of suggested funding mechanisms.
The single-payor, government-run healthcare system under Medicare for All would cover a range of services at no out-of-pocket cost to patients. The measure would not only cover primary and preventive care, as well as inpatient and outpatient hospital services, but also long-term care support services that are not currently covered by Medicare. Every insurance program in the U.S. would be changed, leaving only the veterans’ health program and the Indian Health Service in place. Providers such as hospitals or skilled-nursing facilities would be paid through a global budget so that hospitals would receive a quarterly lump sum to cover items and services. Additionally, individual providers would be paid based on a national fee schedule set by the HHS secretary. A section-by-section summary of the bill, along with other information on the legislation, can be found here.
Last month, State Rural Health Associations were invited to join the NOSORH Policy Committee. The committee heard about the election results, an FORHP regulatory update and a preview of the work of the Policy and Program Monitoring Team. For more information or to join the Policy committee, please contact Matt Strycker.
The following update was provided by Hall Render, NOSORH Policy Liaison:
Democrats Set to Control Key Health Committees in Next Session of Congress
The Democratic takeover of the House of Representatives following the recent midterm elections will significantly change the political landscape for healthcare issues when lawmakers return for the 116th Session of Congress next year. Overall, the election results will mean divided government and a return to the era when little is accomplished legislatively. Lawmakers are expected to go from one “fiscal cliff” to another as they struggle to pass funding bills that will keep the government open.
The main focus of House Democrats is expected to be oversight of the Trump administration’s implementation of health policies but could extend to the idea of “Medicare-for-all” or other programs that would move the country towards universal health care.
Shoring up the Affordable Care Act (“ACA”), drug pricing and surprise medical bills are also anticipated to be some of the major healthcare issues tackled during the new Congress. After Republicans’ unsuccessful efforts to repeal and replace the ACA, House Democrats will be looking to pass legislation bolstering the ACA’s insurance markets and cementing the law’s provisions on pre-existing conditions. They will also look to fixing the cost-sharing reimbursement issue, which saw some bipartisan support in the Senate last year and could be one of the few pieces of legislation that makes it to the president’s desk. By contrast, the Senate, which will remain under Republican control, is expected to focus more broadly on health care.
Both parties are in alignment as to the necessity of lowering drug pricing. House Democrats will try to reign in pharma by making drug pricing one of their top issues. Incoming House Energy and Commerce Health Subcommittee Chairman Anna Eshoo (D-CA) said she wants to hold hearings before developing her prescription drug policy priorities. Meanwhile, Energy and Commerce leadership staff have signaled that 340B drug pricing program reform will no longer be a high priority for the committee. In addition, House Democrats are expected to conduct oversight of issues such as Medicaid work requirements and the Justice Department’s decision to back anti-ACA lawsuits.
At the committee level, Rep. Richard Neal (D-MA) will become the chairman of the full House Ways and Means Committee, which is expected to add at least four new Democratic members. On the Ways and Means Health Subcommittee, Chairman Peter Roskam (R-IL) and Health Subcommittee member Erik Paulsen (R-MN) both lost their races for reelection. With the retirement of Reps. Sam Johnson (R-TX), Lynn Jenkins (R-KS) and Diane Black (R-TN), Republicans will see very large changes in their membership on this subcommittee. Since Republicans currently hold an 11-7 majority on the subcommittee, these losses and retirements should mean no Republican will be removed from the subcommittee and one will be added. As for who will take the gavel as the subcommittee’s next chairman, Rep. Lloyd Doggett (D-TX) is currently expected to get the nod over Rep. Mike Thompson (D-CA) because he has more overall seniority in Congress.
At the House Energy and Commerce Committee, Rep. Frank Pallone (D-NJ) will become the full committee chairman and Rep. Greg Walden (R-OR) will become the Ranking Minority Member. Pallone has a reputation for “doing deals” across the aisle, which could make additional opioid funding a possibility. The change in control of the House means Rep. Michael Burgess (R-TX) will become the Energy and Commerce Health Subcommittee’s Ranking Minority Member once Rep. Eshoo takes the gavel. In addition to drug pricing, Eshoo’s agenda is expected to include coverage of pre-existing conditions and investment in biomedical research and development.
On the Senate side, drug pricing and additional opioid legislation could make some progress, but little else is expected to happen on the healthcare front. Senate Republicans, such as Bill Cassidy (R-LA), will continue to push for 340B reform, but any 340B legislation that passes the Senate should die in the Democratically controlled House. At the committee level, the Health Education Labor and Pensions Committee will see no loss in its membership. Sen. Lamar Alexander (R-TN) will remain chairman and Sen. Patty Murray (D-WA) will remain the Ranking Member.
At the Senate Finance Committee, Sen. Chuck Grassley (R-IA) is expected to become the next chairman. Sen. Grassley says he wants to work “on improving the affordability, quality and accessibility of health care, including in rural America.” Sen. Ron Wyden (D-OR) will remain the committee’s Ranking Member. Losses by Sen. Claire McCaskill (D-MO) and Sen. Dean Heller (R-NV) open one seat on the Democratic side of the committee aisle and one on the Republican, which are expected to be filled before lawmakers return for the 116th Session of Congress in January.
Congress Unlikely to Make Progress on Health Care Bills Before Year-End
As government funding battles overtake Capitol Hill, it appears Congress will not use the lame duck to resolve outstanding healthcare issues. While the desire to steer clear of health are fights is something different from prior years, outgoing House Ways and Means Committee Chairman Kevin Brady (R-TX) said this week that healthcare legislation will not be a priority during what’s left of the lame duck session.
Furthermore, Democratic control of the House of Representatives that comes in January has caused many Democratic lawmakers to push their healthcare priorities into the New Year. However, some policy changes could still surface as additions to a year-end spending package that must be passed before December 7 in order to avoid a partial government shutdown.
Luckily for a majority of healthcare programs, funding for most agencies within the Department of Health and Human Services (HHS) was included in a giant spending package Congress passed in September. Those that remain to be funded include the FDA, which receives its funding through a separate bill and user fees. A House Republican tax bill was released on November 26, but it did not address any of the Affordable Care Act’s taxes, such as the medical device tax and the “Cadillac” tax on health plans.
CMS to Expand Medicaid Covered Mental Health Treatment
On November 14, CMS announced that states can soon begin applying for waivers to expand treatment capacity for serious mental health issues. HHS Secretary Alex Azar highlighted the effectiveness of waivers for substance abuse treatment citing Virginia as an example. Virginia received approval for a waiver in 2016 and subsequently saw a 39 percent decrease in opioid-related emergency room visits.
Waivers will allow states to lift the “IMD exclusion.” The IMD exclusion prohibits the use of federal Medicaid funds to pay for substance use disorder treatment for patients age 21-64 at inpatient mental health treatment facilities that have more than 16 beds. It also prohibits Medicaid beneficiaries who are receiving treatment at IMDs from receiving additional Medicaid-covered care elsewhere. Many experts state the IMD exclusion is a large hindrance to treatment for low income people.
Health-Related Bills Introduced This Month
Sen. Orrin Hatch (R-UT) introduced S.3693 to amend Title XVIII of the Social Security Act to provide for the treatment of certain cancer hospitals.
Sen. Todd Young (R-IN) introduced S.3685 to amend the Public Health Service Act to expand the authority of the Secretary of Health and Human Services to permit nurses to practice in healthcare facilities with critical shortages of nurses through programs for loan repayment and scholarships for nurses.
Sen. Jeff Merkley (D-OR) introduced S. 3680 to require the Secretary of Health and Human Services to establish references prices for prescription drugs for purposes of federal health programs.
Rep. Erik Paulsen (R-MN) introduced H.R. 7177 to amend Title III of the Public Health Service Act and Titles XI and XVIII of the Social Security Act to accelerate the adoption of value-based payment and delivery arrangements among health care stakeholders intended to coordinate care, improve patient outcomes, share accountability or lower costs.
Sen. Bill Cassidy (R-LA) introduced S. 3619 to amend Title XVIII of the Social Security Act to restructure the payment adjustment for non-emergency ESRD ambulance transports under the Medicare program.
Rep. Erik Paulsen (R-MN) introduced H.R. 7122 to amend Title III of the Public Health Service Act and Titles XI and XVIII of the Social Security Act to accelerate the adoption of value-based payment and delivery arrangements among healthcare stakeholders intended to coordinate care, improve patient outcomes, share accountability or lower costs.
Sen. Rand Paul (R-KY) introduced S. 3610, known as the Medicare Patient Empowerment Act of 2018, to amend Title XVIII of the Social Security Act to establish a Medicare payment option for patients and eligible professionals to freely contract, without penalty, for Medicare fee-for-service items and services while allowing Medicare beneficiaries to use their Medicare benefits.
NOSORH welcomes new Policy Committee Co-Chair Scott Daniels (HI), stepping in for Mark Schoenbaum who retired earlier this month. Watch for the article in the Roots newsletter next week for a tribute to Mark’s great work for NOSORH over the years. Lisa Davis (PA) will continue to serve on the Board as the Policy Ex-Officio. In addition, Matt Strycker, NOSORH Project Manager, will be adding support to the important work of the the Policy Committee.
NOSORH has resources to help you and your state partners prepare for the National Rural Health Association Policy Institute being held Feburary 6-8 in Washington, DC. One-page state profiles are available to help SORH document rural health and the impact of their work. For help in completing your state’s profile, contact Donna Pfaendtner. A NOSORH request factsheet will be prepared for your use at the Policy Institute and Hall Render staff are available to join you on hill visits if you’re interested. Please plan to join the member and State Office Council meeting February 5 at 6 pm. In addition, NOSORH will host a webinar on January 18 at 2:00 pm ET to help SORH and their partners prepare for the Institute.
The following update was provided for our members by Hall Render, NOSORH Legislative Liaison:
SORH Reauthorization Bill Introduced in the Senate
On January 4, a bipartisan group of Senators introduced the State Offices of Rural Health (SORH) Reauthorization Act of 2017. Co-Chairs of the Senate Rural Health Caucus, Senators Pat Roberts (R-KS) and Heidi Heitkamp (D-ND), introduced the stand-alone bill which NOSORH has endorsed.
The legislation seeks to reauthorize the State Offices of Rural Health grant program for the first time, maintains the three-to-one federal to state match, and ensures greater accountability to HHS from state grantees. Other Senators who have endorsed the legislation as original co-sponsors are John Barrasso (R-WY), Bob Casey (D-PA), Charles Grassley (R-IA) and Tammy Baldwin (D-WI). All SORH and partners are asked to reach out to their Senators to inquire about their interest in sponsoring the bill.
With the stand-alone Senate bill now introduced, NOSORH will focus on getting a companion measure introduced in the House of Representatives.
Rural Broadband Program Expanded by FCC
In December, the Federal Communications Commission (FCC) voted to put additional funds into its rural health broadband subsidy program. The funds will be redistributed to ensure all eligible applicants in 2017 receive money. The Rural Health Care Program distributes $400 million annually for rural doctors, hospitals and nursing homes to adopt and pay for broadband internet access. The additional funds were necessary since the program reached its funding cap the last two years due to the increase in telemedicine use, as well as nursing homes being eligible for subsidies.
On January 2, the FCC issued a notice of proposed rulemaking seeking suggestions on how to expand its Rural Health Care Program. The notice mulls several possible changes to the program beyond merely raising the cap, including changing the definition of “rural health care” and cracking down on perceived waste, fraud and abuse. The NOSORH Policy and Program Monitoring Team will be crafting comments and response to the notice. Comments are due Friday, February 2.
Congress Passes Stopgap Spending Bill to Avoid Government Shutdown
After passing the most significant tax reform legislation in decades, Republicans avoided a government shutdown on December 22 by passing legislation that temporarily funds the government through January 19, 2018. The House voted 231-88 to approve the short-term spending bill, and the Senate quickly followed, passing the bill on a 66-32 vote.
The spending package maintains FY 2017 spending levels and waives the Pay-As-You-Go rules that would have resulted in billions of dollars in cuts to programs like Medicare. It also funds the Children’s Health Insurance Program (“CHIP”) through March 31, 2018 with $2.85 billion in allocated funds. Congress is likely to come to terms on a FY 2018 spending package by mid-January. Congress will then shift its focus to the FY 2019 appropriations process.
Congress Shifts Focus to 340B Drug Discount Program
Starting January 1, 2018, hospitals will receive the average sales price minus 22.5 percent, a change that will result in payment cuts of $1.6 billion. In the House, almost 100 lawmakers from both sides of the aisle have cosponsored a measure (H.R. 4392) that would reverse the action taken by CMS.
In early December, a bipartisan group of six senators submitted a letter to Senate leadership calling for the passage of legislation to prevent a dramatic reduction in payments for hospitals participating in the 340B drug discount program.
In late December, Rep. Larry Bucshon (R-IN) introduced the 340B Protecting Access for the Underserved and Safety-Net Entities Act, or 340B PAUSE Act (H.R. 4710), to amend the Public Health Service Act to establish a moratorium on the registration of certain new 340B hospitals and associated sites. The legislation was introduced to address concerns of lack of transparency or oversight in the program. The 340B PAUSE Act temporarily pauses new enrollment of Disproportionate Share Hospitals into the 340B discount drug program and requires basic data reporting. Critical access hospitals, sole community hospitals and rural referral centers would not be affected by this legislation.
The NOSORH Policy Committee meets the third Tuesday of every month at 2:00 pm Eastern and hears regular policy updates from key partners. A summary of relevant policy and regulatory issues is shared and discussed- click here for this month’s update. The committee is dedicated to addressing policy issues relevant to SORH, including the reauthorization of the SORH program and increasing appropriations. It is expected that legislation to ensure SORH reauthorization will be introduced within the next week. Watch your email for more information on the support needed and a draft of the SORH language.
The following update was provided for our members by Hall Render, NOSORH Legislative Liaison:
Congress Celebrates National Rural Health Day
On November 16, Congress celebrated National Rural Health Day. NOSORH hosted a webinar that had a number of Congressional staffers on the call. The Senate Rural Health Caucus led by Senator Pat Roberts (R-KS) is actively working to introduce the State Offices of Rural Health Reauthorization Act of 2017. This bill would be a stand-alone measure reauthorizing the SORH program for five years.
On the appropriations front, federal funding is set to expire on December 8. Congress will most likely extend FY 17 funding through a Continuing Resolution for up to one month in hopes of brokering an omnibus spending deal for FY 2018 funding.
FCC Promotes Broadband Expansion
The Federal Communications Commission (FCC) released a draft notice of proposed rulemaking to review its Rural Health Care Program. The goal of the rulemaking is to meet the increasing demand for broadband telehealth services. After the program exceeded the cap in both 2016 and 2017, the FCC also released a draft order to waive the program’s $400 million cap on a one-time basis and consider a permanent expansion of funds. The notice ensures sufficient funding for rural healthcare providers and simplifies program participation. The proposed rulemaking will be addressed at a public hearing on December 14.
Bill Introduced to Prevent 340B Cuts
On November 14, a bipartisan bill was introduced to prevent CMS from implementing the $1.6 billion cut to the 340B drug discount program. The legislation, introduced by Reps. David McKinley (R-WV) and Mike Thompson (D-CA), pushes HHS to maintain the current 340B discount rate of Average Sales Price (“ASP”) + 6 percent. In the 2018 OPPS final rule, CMS revised the payment rate to ASP -22.5 percent, which amounts to an overall cut of more than 28 percent. On November 13, a group of hospital associations and health systems sued the Trump administration in D.C. federal court to block the payment cuts before they are set to begin on January 1.
Proponents of the legislation will push lawmakers to pass it despite opposition from many House and Senate Republicans who have questioned the substantial increase in 340B spending in recent years. If the measure were to pass both houses of Congress, it could very well be vetoed by President Trump, who is unlikely to overturn a decision made by the leadership of CMS that he appointed. Last month, 228 members of the House signed a letter in opposition to the then-proposed 340B cut, while a bipartisan group of 57 senators signed a similar letter.
House E&C Committee Holds MACRA Hearing
On November 8, the House Energy & Commerce Health Subcommittee held a hearing on implementing alternative payment models for physicians and other clinicians under MACRA. In order to boost participation in the alternative payment model provided by MACRA, physician groups claim they need more government support to address barriers, which include the need for technical assistance to help doctors transition from fee-for-service to value-based care, greater access to shared data and the need to test new small-scale models. The hearing occurred the week after CMS finalized a proposed rule to exempt more small providers from complying with MACRA.
Congress is hearing from a range of hospital stakeholders about improving quality and reducing the burden under the Merit-Based Incentive Payment System (“MIPS”). Health Subcommittee Chairman Rep. Michael Burgess (R-TX) has said that MIPS will get its own hearing “in the very near future.”
Physician Payment Rule Released by CMS
CMS released the CY 2018 Physician Fee Schedule final rule on November 2. The rule finalizes a policy to pay off-campus facilities 40 percent of what would have been paid under outpatient service rates. The reduction in payment is less severe than the agency’s initial proposal to cut payments in half. While CMS argues this change will promote more competition between hospitals and physician practices, providers are criticizing the decision because it would decrease access to care at off-campus facilities in already underserved communities.
CMS will also pay for new telehealth services, such as health risk assessments, psychotherapy for crisis and care planning for chronic care management.
House Passes CHIP Funding Legislation
On November 3, the House passed a bill to reauthorize the Children’s Health Insurance Program (“CHIP”) for five years. After extensive debate from the parties over the pay-for provisions prior to the vote, the proposal passed on a party-line vote: 242 to 174. The measure also includes funding for federally qualified health centers and other health programs. The CHIP funding bill is now moved to the Senate for consideration. While House Republicans passed this legislation, many consider the effort not grounds for a deal since it was partisan. Funding for CHIP has been expired for nearly 60 days so many states have relied on temporary cash infusions from the federal government to fund their programs.
Rural Health-Related Bills Introduced this Week
Rep. Greg Gianforte (R-MT) introduced a bill (H.R. 4390) to reauthorize the rural emergency medical service training and equipment assistance program under section 330J of the Public Health Service Act. Rep. Jodey Arrington (R-TX) introduced a bill (H.R. 4178) to amend Title XVIII of the Social Security Act to provide for a permanent extension of the Medicare-dependent hospital program.
The following update was provided for our members by Hall Render, NOSORH Legislative Liaison, on September 27, 2017:
Senate Committee Advances HHS Spending Bill
Congress returned in September after their annual August recess. With Fiscal Year (FY) 2017 funding set to expire October 1, Congress and the White House quickly agreed to terms on a three-month continuing resolution (CR) for FY 17 funding. The three-month CR will keep FY ’17 funding levels in place until December 8, 2017. Congress will then most likely pass an Omnibus FY 2018 spending bill sometime before Christmas.
On September 7, the Senate Appropriations committee voted to advance the FY 2018 Labor, HHS, and Education (Labor-HHS) Appropriations Bill. The bill includes $79.4 billion in discretionary funding for HHS, a $1.7 billion increase above FY 2017 and a $4.5 million increase for rural health programs over FY ’17.
Among the highlights to rural health, the committee provided $10 million for State Offices of Rural Health (SORH), which matches the House appropriated number from earlier in the spring. The committee also provided $67.5 million for the Rural Health Outreach program, which is $2 million above the FY ’17 level. $43.6 million was provided for Rural Hospital Flexibility Grants and $9.3 million for the Rural Health Research program.
NOSORH Attends Senate Rural Health Summit
On September 13, NOSORH leadership was in Washington to attend the annual Senate Rural Health Summit. NOSORH leaders met with and heard from members on the importance of rural health programs. While in Washington, NOSORH leaders also met with the staff director of the Senate Rural Health Caucus to discuss the SORH Reauthorization bill. NOSORH is hoping a stand-alone SORH reauthorization bill will be introduced in the coming months.
House Committee Seeks Information on 340B
Leaders from the House Energy and Commerce Committee are soliciting information from providers regarding the 340B drug discount program. The Committee has asked providers for details on how much savings are received from the 340B program, who the drugs go to, as well as how the savings are used. Earlier this summer, the committee held a 340B oversight hearing where members expressed concern about the rapid growth and lack of oversight in the Health Resources and Services Administration (HRSA) program. The Committee is intending to use the information to broaden understanding of how program savings are being utilized by covered entities to help patients.
CMS Issues RFI for Innovation Center
On September 20, CMS issued an informal request for information to gather feedback on changing the direction of its CMS Innovation Center. Comments will be received through November 20, 2017 and can be submitted here.
The Innovation Center is interested in testing models in eight focus areas including increased participation in advanced alternative payment models, consumer-directed care and market-based innovation, physician specialty models, prescription drug models, Medicare Advantage innovation models, state-based and local innovation, including Medicaid focused models, mental and behavioral health models and program integrity.
Energy and Commerce Advances Batch of Health Care Bills
On September 13, the House Energy and Commerce Committee advanced a series of bipartisan, Medicare-related bills. Many were similar to measures included in the Senate Finance Committee’s CHRONIC Care Act. The committee advanced H.R. 1148, the Furthering Access to Stroke Telemedicine Act introduced by Rep. Morgan Griffith (R-VA). This would expand access to Medicare-reimbursed neurological consultations via telemedicine for patients at hospitals or mobile stroke units.
The Committee also advanced the Medicare Civil and Criminal Penalties Act, authored by Reps. Gus Bilirakis (R-FL) and Kathy Castor (D-FL), to update penalties within the Medicare program. Neither penalty has been updated in 20 years. Additionally, the committee advanced legislation (H.R. 3120) introduced by Chairman Michael Burgess (R-TX). The legislation is intended to reduce the volume of future electronic health record-related significant hardship requests. It would amend the Health Information Technology for Economic and Clinical Health Act to remove the mandate that meaningful use standards become more stringent over time.
Ways and Means Advances Hall Render’s Stark Initiative
On September 13, the House Ways & Means Committee advanced three health care bills, including a revised version of the Stark Administrative Simplification Act of 2017 (H.R. 3726). The bipartisan bill, which passed unanimously, is the product of the coalition of hospitals and health systems created by Hall Render. The new measure was introduced by Reps. Kenny Marchant (R-TX) and Ron Kind (D-WI) and would allow hospitals to pay a fixed fee to CMS for technical violations of the Stark Law and create a new protocol for their resolution by CMS. The revised legislation will now be voted on by the full House and then proceed to the Senate where additional revisions are expected.
The committee also passed H.R. 3727, introduced by Rep. Diane Black (R-TN), to increase telehealth coverage. Currently, Medicare fee-for-service limits reimbursement to rural medical facilities, and the program only covers some types of remote monitoring. H.R. 3727 is intended to increase telehealth services through Medicare by removing some of the barriers to access. Earlier this year, the Senate Finance Committee passed similar legislation in the Medicare CHRONIC Care Act. Additionally, the committee advanced H.R. 3729, introduced by Reps. Devin Nunes (R-CA) and Terri Sewell (D-AL), to improve and extend add-on payments for Medicare’s ground ambulance transport program.
Health-Related Bills Introduced this Month
Rep. David Young (R-IA) introduced a bill (H.R. 3817) to amend title XVIII of the Social Security Act to improve the accuracy of geographic adjustment factors under Medicare and to permanently extend certain adjustments to such factors for certain localities. Senator Chuck Grassley (R-IA) introduced a companion bill in the Senate (S. 1825).
Rep. Richard Hudson (R-NC) introduced a bill (H.R. 3789) to amend Title XVIII of the Social Security Act to provide under the Medicare program for conditions of participation, reporting requirements and a quality program with respect to air ambulance services.
Rep. Elise Stefanik (R-NY) introduced the Community Health Investment, Modernization, and Excellence Act of 2017 (H.R. 3770). This bipartisan legislation would extend funds for community health centers.
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:
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.
There is much work to be done to keep members of Congress up to date on the work of your SORH. Summer recess brings many members home to their district, so take that opportunity to attend their meetings, reach out to local contacts, even consider offering them a site visit to a rural clinic or community to help them understand the needs your SORH is addressing. NOSORH is ready to help you prepare and position your SORH and stakeholders to tell their story. To keep you informed of rural health policy, the Policy Committee meets each month to focus on policy issues of most importance to State Offices of Rural Health. All members of NOSORH are encouraged to attend and to sign-up for the committee information. If you are not already receiving policy updates, please contact Beth Kolf, NOSORH Program Coordinator, to be added to the Policy Committee list.
The following update was provided by Hall Render, NOSORH Legislative Liaison:
House Appropriators Finalize FY 2018 Spending Plans On July 12, House Appropriators advanced their funding proposal for the Labor-HHS fiscal year (FY) 2018 spending bill. The subcommittee spending level, which is known as the 302(b) allocation proposes $157.9 billion for the departments of Labor, HHS and Education. That total would be roughly two percent, or $3 billion below the current allocation of $161 billion for FY 2017. The committee funded Health Resources and Services Administration (HRSA) at $5.8 billion which is almost $400 million below FY 2017 levels but $276 million above the President’s request.
The committee recommended the same overall funding level as enacted in FY 2017. That level, $156 million, is $81 million above the president’s requested level of funding. The committee funded the State Office of Rural Health program at $10,000,000 and the Rural Hospital Flexibility Grants at $43,609,000 for FY 2018, representing small increases to both programs
The Senate is working on a slower timeline as the 12 subcommittees have only just begun consideration of FY 2018 spending levels. The first Senate appropriations subcommittee hearings are scheduled to begin in the coming weeks. Of the 12 spending bills, the Labor-HHS bill is almost always the most difficult for the House to pass due to partisan policy riders and spending levels. The slower Senate pace will most likely lead to the Labor-HHS funding bill to be wrapped into an omnibus spending package.
Senate Postpones Vote on BCRA
The Senate postponed voting on a procedural motion to advance the Better Care Reconciliation Act (BCRA). The vote is a major setback for Republicans as they lacked a majority of votes to bring the bill to the Senate floor for full debate. The announcement to postpone comes less than a week after Senate Republicans released their revised health reform bill.
The latest version doesn’t make significant changes to the Medicaid overhaul proposed in the original BCRA, which would cut nearly $800 billion rolling back the ACA’s Medicaid expansion and capping payments for each enrollee. The latest version of BCRA does makes changes intended to allow for more accurate Disproportionate Share Hospital (DSH) related decisions by changing the DSH calculation from per Medicaid enrollee to per uninsured. Among other new features, the latest draft also keeps some ACA-related taxes on the high-income earners and directs more than $100 billion in new spending to help low-income Americans buy coverage and combat the opioid epidemic.
It’s worth noting that the effort to repeal the ACA is not completely dead. Senate Majority Leader McConnell (R-KY) still plans to hold a procedural vote soon that’s likely to fail. There has been discussion of shifting to a repeal and delay strategy which would repeal major portions of the ACA and replace them at a later time.
CMS Releases 2018 Physician Fee and HOPD Payment Rules
On July 13, CMS released their proposed 2018 payment and policy rule for the Physician Fee Schedule. The proposed rule would update Medicare payment rates for doctors who treat Medicare patients in calendar year (CY) 2018. CMS estimates a 0.31 percent increase in physician payment rates for CY 2018 compared to 2017. It also proposes the addition of new telemedicine payment codes doctors can bill for including psychotherapy for crisis, Health Risk Assessments and care planning for chronic care management. CMS released a fact sheet further detailing the proposed rule.
On the same day, CMS also released a proposed rule that updates payments rates and policy changes in the Hospital Outpatient Prospective Payment System (OPPS). The rule proposed to increase prospective payment system rates by 1.75 percent beginning in CY 2018 compared to CY 2017.
Among the provisions 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. The rule keeps in place Stage 3 meaningful use requirements. The rule would also reinstate for CY 2018 and 2019 the moratorium on enforcement of the direct supervision requirement for outpatient therapeutic services for critical access hospitals and small rural hospitals with 100 of fewer beds.
As the agency has done in other proposed rules including the physician fee schedule, CMS is releasing within the proposed rule a Request for Information on making the Medicare program more flexible and efficient. CMS issued a fact sheet detailing the OPPS rule. Comments on the rule are due by September 11, 2017.
CMS Releases 2018 MACRA Proposed Rule
On June 20, CMS published the massive 2018 MACRA rule. The 1,058 page proposed regulation carries out the 2015 law that seeks to overhaul the payment of doctors based on quality measures. CMS stated the goal behind the regulation is to simplify the program, especially for small, independent, and rural practices, while ensuring fiscal sustainability and high-quality care within Medicare.
The proposed rule would amend some existing requirements and contains new policies for doctors and clinicians participating in the Quality Payment Program that would encourage participation in either Advanced Alternative Payment Models or the Merit-based Incentive Payment System (MIPS).
CMS had already exempted from MIPS doctors who either bill Medicare no more than $30,000 a year or see fewer than 100 Medicare beneficiaries. In the CMS proposal, the threshold will be increased to $90,000 in Medicare charges or 200 Medicare beneficiaries.
Doctors in small practices also could seek exemptions from electronic health record requirements. Additionally, CMS proposed delaying a requirement to upgrade electronic health records (EHR) for practices of all sizes. The rule calls for encouraging providers to upgrade to 2015 certified EHR technology by offering bonus points on performance scores of those that made the switch.
Rural Health Related Bills Introduced this Month
Senator Roger Wicker (R-MS) and Brian Schatz (D-HI) reintroduced legislation that would allow non-rural health providers that serve predominately rural areas to become eligible for the FCCs rural broadband support fund. Currently, the FCC program is only available to providers in rural areas.
Rep. Sam Graves (R-MO) introduced a bill (H.R. 2957) that would amend titles XVIII and XIX of the Social Security Act to provide enhanced payments to rural health care providers under the Medicare and Medicaid program.
Senator Chuck Grassley (R-IA) introduced a bill (S. 1351) to amend the public Health Service Act with respect to the designation of general surgery shortage areas. A companion bill (H.R. 2906) was introduced in the House by Rep. Larry Bucshon (R-IN).