As of the most recent count, approximately 60 SORH attendees will participate in the National Rural Health Association’s Annual Policy Institute. NOSORH will provide a member and partner brief with Legislative Liaison Andrew Coats (Hall Render) and convene the State Office Council on Monday, February 5 at 6:00 PM.
NOSORH is asking SORH and their partners to request to pass Senate Bill 2278, please introduce a House companion bill to support for reauthorization of the State Office of Rural Health Program and for level funding for the SORH appropriation. A fact sheet is available for all SORH and their partners to print and include in their visit packets during the Policy Institute or to make a simple contact by email. Printed copies of the fact sheet will be available at the NOSORH members meeting.
The following update was provided for our members by Hall Render, NOSORH Legislative Liaison:
Congress Votes to End Government Shutdown – What’s Next?
After a three-day government shutdown, the Senate voted 81-18 on January 22 to fund the government through February 8, 2018. The continuing resolution (CR) was then sent to the House, where it passed 266-150. President Trump subsequently signed the bill into law on January 22. The three-week CR includes a six-year funding renewal of the Children’s Health Insurance Program (CHIP). The bill also delays the Affordable Care Act’s medical device tax and Cadillac tax on high-cost health insurance plans for two years and its tax on health insurance providers for one year.
Despite passing the CR, lawmakers remain under increasing pressure to reach a long-term budget agreement. In order to strike such a deal, Republicans will need support from at least nine Senate Democrats. While CHIP now has long-term financial support, funding for many other health programs, including “Medicare extenders” and DSH, expired at the end of September but were not included in the most recent CR. In a meeting with senior health care policy staff on Capitol Hill, Hall Render attorneys were told that lawmakers plan to include money for Medicare extenders and DSH in the next government funding bill that must be passed before February 8, if offsets can be found to cover the costs. Historically, Congress has covered such costs by implementing new cuts for providers, and it is expected that lawmakers will do so again in this case.
340B Remains Active Topic in Congress
On January 17, Sen. Bill Cassidy (R-LA) introduced a bill (S. 2312) that seeks to prevent certain hospitals from entering the 340B drug discount program until certain transparency measures and reporting requirements are strengthened. The Cassidy bill is the Senate version of the recently introduced 340B Pause Act and can serve as another reason for the Senate Health Education Labor and Pensions (HELP) Committee to hold future 340B oversight hearings.
The measure would create a moratorium on new DSHs from entering the 340B program for at least two years or until the Health Resources and Services Administration (HRSA) writes regulations for the 340B program with additional transparency measures and reporting requirements for hospitals. The bill would also require hospitals to use CMS’s new 340B claims modifier on drugs purchased through the program.
Under the Cassidy bill, critical access hospitals, rural referral centers, sole community hospitals, grantees and PPS-exempt children’s or cancer hospitals would still be able to enroll in the 340B program. The bill also exempts grantees and rural and critical access hospitals from most of the bills reporting requirements.
On January 10, the House Energy and Commerce Committee released a report following a broad review of the 340B program and several oversight hearings held in 2017. While the report highlights the strong bipartisan support of the program, the report also includes its perceived weaknesses such as the lack of transparency and oversight. The report concluded HRSA lacks sufficient regulatory authority to adequately oversee the program and the audit process in place is inadequate. The report also claims there is a lack of reliable data on how program savings are used because the 340B statute does not include reporting requirements for covered entities.
Azar Confirmed as HHS Secretary
The Senate confirmed Alex Azar as the next Secretary of Health and Human Services in a 55-43 vote. Six Senate Democrats and Independent Angus King (I-ME) joined nearly all Republicans in backing Azar’s nomination. Sen. Rand Paul (R-KY) was the only Republican to oppose Azar, which he said was due to his disagreement with Azar over drug re-importation. As the country’s top health official, Azar has pledged to prioritize lowering drug prices.
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:
NOSORH Makes October Hill Visits
On October 25-26, NOSORH and SORH visited Washington DC to meet with Hill leaders. The group met with House and Senate offices to discuss an upcoming SORH reauthorization bill being introduced in November and began discussions on fiscal year (FY) 2019 appropriations.
Hatch-Brady Proposal Introduced as Alternative Market Stabilization Plan
On October 24, Senate Finance chairman Orrin Hatch (R-UT) and House Ways and Means chair Kevin Brady (R-TX) proposed a bicameral agreement for ACA market stabilization. Similar to the Senate HELP Committee proposal released last week, Hatch-Brady includes two years of funding for the ACA’s cost-sharing subsidies. The Hatch-Brady plan would also waive the ACA’s individual mandate for five years. Further, employers would not be penalized through the employer mandate if coverage was not provided for the previous two years.
Both Senate proposals were introduced shortly after the White House announced that it will no longer make the ACA’s cost-sharing reduction payments. Eighteen Democratic state attorneys general sued to force the administration to keep making the payments until the courts can decide whether it is legal for the funds to be cut unilaterally. However, U.S. District Court Judge Vince Chhabria ruled last week that the administration does not have to continue making the payments.
For Republicans to pass one of these market stabilization bills, they would need to secure 60 votes in the Senate. As it stands, the Alexander-Murray bill appears to have 60 votes in the Senate, but the vote count on Hatch-Brady is unclear. The sticking point for Hatch-Brady would be that Democrats are expected to oppose any waiver of the individual mandate. Thus, it is likely that Republicans will either have to pass Alexander-Murray, with some minor modifications, or not pass anything at all.
Opioid Crisis Declared National Public Health Emergency
On October 26, President Trump officially declared the opioid epidemic a national public health emergency under federal law. The administration took action because drug overdoses are now the leading cause of death by injury in the United States, topping both traffic crashes and gun-related violence. The directive included action items, such as opioid training for prescribers and lifting a restriction in some states on inpatient treatment. However, there was no new funding announced to address the emergency.
The administration established the President’s Commission on Combating Drug Addiction and the Opioid Crisis in March of 2017. The Commission noted the fastest way to increase treatment would be to waive the prohibition on using Medicaid funds to pay for inpatient substance abuse treatment. The administration’s directive indicates it will follow the Committee’s recommendation by allowing many states to waive this prohibition. Additionally, the White House said it will extend the use of telemedicine to address the opioid epidemic by allowing for the remote prescribing of medicine used for the treatment of substance abuse and mental health.
White House, Congress Continue Scrutiny of 340B Program
On October 6, the White House Office of Management and Budget (OMB) began review of the proposed rule on 340B ceiling prices and manufacturer penalties. The 340B rule was originally proposed by HRSA in the final days of the Obama Administration and has been delayed multiple times by the Trump Administration. The rule sets penalties for manufacturers that “knowingly and intentionally” overcharge 340B providers and also includes a formula for calculating discounts.
Over the past three months, the House Energy and Commerce Committee has conducted multiple hearings on the issue and expressed repeated concerns over program growth in recent years. On October 18, the Committee held a hearing examining how 340B entities are using the program, including how much money is saved, how entities track their savings, the types of drugs purchased and prescribed within the program and how those savings are used to improve patient care.
Though the 340B program received praise for supporting many other programs through savings, Republicans raised concerns over lack of transparency and data on the program since Congress is responsible for making sure the program is running correctly. OMB is still reviewing the CY 2018 OPPS final rule that is expected to include changes to the 340B payment structure. The proposed rule had hospitals being paid 22.5% less than the average sales price for drugs acquired under the 340B program, which is a major change from the current 6% on top of the average sales price.
Rural Health-Related Bills Introduced This Week
Sen. Michael Bennett (D-CO) introduced the Medicare-X Choice Act (S.1970). The bill intends to establish a public insurance plan offered on the individual and small business health exchanges. Initially, Medicare-X would only be available in rural areas, but the goal is to have Medicare-X expand to all places by 2023.
Rep. Kristi Noem (R-SD) introduced the Rural Home Health Extension and Regulatory Relief Act. This legislation would amend title XVIII of the Social Security Act to delay application of, transition to, and limit savings for the home health groupings model under the Medicare home health prospective payment system.
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).
NOSORH Policy leadership met last week and planned responses to Congress on the FY 18 budget request. Letters have been sent to the Senate and House Appropriations Committee Chairs and to key legislative contacts NOSORH leadership met last month. Appropriations Chairs are accepting comments from congressional members on the committees through June 9 on the President’s budget. Please use these NOSORH letters to be in touch with your members of congress to make comment to support SORH and FLEX funding. You may see members of Congress during their upcoming recess. This is an excellent time to share the work of your SORH and Flex programs with them. If you need help with a state fact sheet or any other messages, please contact Donnap@nosorh.org. Watch your email for images you can use on social media to grow support for SORH work.
The following detailed update was provided by Hall Render, NOSORH Legislative Liaison:
Congresses Passes FY 2017 Spending Bill
On May 5, the President signed into law the fiscal year (FY) 2017 omnibus appropriations bill a day ahead of the midnight deadline. The Consolidated Appropriations Act of 2017 (H.R. 244) enjoyed wide bipartisan support in both the House and Senate and provides discretionary funding for the federal government through at least September 30, 2017.
The bill includes $73.5 billion for Health and Human Services (HHS), a $2.8 billion increase from FY 2016. The Health Resources and Services Administration (HRSA) would receive a $6 million increase for rural health programs. Within the HRSA account, a $2 million increase was provided for Rural Hospital Flexibility (FLEX) grants and the State Offices of Rural Health (SORH) were provided a nearly $500,000 increase over FY 2016. Also within the HRSA account, telehealth would receive an extra $1.5 million, bringing its total to $18.5 million.
White House Submits FY 18 Budget Request to Congress
With both parties strongly backing the FY 2017 spending bill, attention in the appropriations process shifts to FY 2018, which begins in October. On May 23, the White House submitted their proposed fiscal year (FY) 2018 budget request to Congress. The HHS budget request calls for a $610 billion cut to Medicaid and a $12.4 billion cut to HHS’ discretionary funding.
The proposal calls for nearly a 50 percent funding cut to rural health. Included in the cut was zeroing out funding for SORH and FLEX Grants. The SORH and FLEX programs were part of a larger group of HRSA cuts. In total, HRSA funding was down by 10 percent with its telehealth funding reduced from $17 million to $10 million.
Like every Administration’s budget request, the proposal is non-binding with Congress and generally not aimed at seeking bipartisan agreement. Congress has the ultimate say in funding and has shown a preference for funding rural health.
Senate Begins Work on House-Passed AHCA
Republican senators will work through June to make changes to the House-passed American Health Care Act (AHCA). When Congress returns the week of June 5, the House is expected to officially hand over the AHCA to the Senate after the Congressional Budget Office (CBO) confirmed the bill meets the Senate’s procedural requirement of saving at least $2 billion over 10 years.
In their report, CBO detailed that 14 million fewer people will be insured one year after passage and 23 million fewer will be insured in 10 years. These numbers alone will make it difficult for Senate Majority Leader Mitch McConnell (R-KY) to deliver the needed 50 votes for passage. CBO also estimated that the AHCA would cut spending on Medicaid by $834 billion and the program would cover 14 million fewer people.
Republican members have made no secret that the House-passed AHCA will undergo a substantial move back to the center as they seek the magic 50 votes for passage (Vice President Pence would break a 50/50 tie). Changes are believed to include increased funding for rural hospitals that lose subsidies under Affordable Care Act (ACA) repeal, providing a larger share of tax credits to lower income consumers nearing Medicare age (aged 50 to 64) and beefing up the high-risk pool funding for states.
The most optimistic timeline for Senate passage is by the July 4 recess which begins June 30. Republicans then hope the House and Senate are able to reconcile the changes and send it to the White House by the beginning of August.
Senate Finance Advances Telemedicine Bill
On May 18, the Senate Finance Committee marked up the bipartisan CHRONIC Care Act (S. 870) which contains a number of telemedicine related provisions. The bipartisan bill allows Medicare to pay for remote stroke diagnosis and treatment, ACOs to provide telemedicine, Medicare Advantage plans to offer telemedicine as a supplemental benefit, as well as fund home dialysis treatment through telemedicine.
The telemedicine related provisions would increase Medicare spending by $150 million over 10 years according to a Congressional Budget Office (CBO) score. The last public CBO score of telemedicine was back in 2001, when Congress created 1834(m) to allow Medicare to pay for live telemedicine interactions for rural patients in health care settings. The fate of S. 870 is unclear on the House side. The House and HHS Secretary Tom Price are seeking to address Medicare payment issues but spending concerns could be a roadblock.
Rural Health Related Bills Introduced in May
Senator Charles Grassley (R-IA) introduced a bill that seeks to create a new Rural Emergency Hospital classification under Medicare. Under the proposed legislation, the hospital would not have to maintain a minimum number of inpatient beds, but would be required to have an emergency room and outpatient services. Under the new classification, it would be required to maintain protocols to rapidly expedite patients to larger facilities if necessary.
Rep. Sean Duffy (R-WI) introduced a bill that seeks to expand coverage of telehealth services under Medicare to provide coverage for home-based monitoring for congestive heart failure and chronic obstructive pulmonary disease. The bill (H.R. 2291) expands telehealth services to rural clinics and Metropolitan Statistical Areas of 70,000 people or fewer.
Rep. Diane Black (R-TN) introduced a bill (H.R. 2556) seeking to expand access to telehealth services under Medicare.
Last week, NOSORH leaders visited congressional staffers from eight states. Among those in attendance were Mark Schoenbaum (MN), Policy Committee Co-Chair; John Barnas (MI), Policy and Program Monitoring Team Co-Chair; Teryl Eisinger, NOSORH Executive Director; and Andrew Coats, Legislative Liaison.
“We certainly heard support from nearly every office, and in fact, that support was evident in the passing of the Continuing Resolution with an increase to SORH,” said Eisinger. This is the first increase seen in many years, and it’s not yet clear how those funds will be granted. The funding is in place for this year’s budget. “It’s quite evident we must be able to help policy makers understand the needs of rural people and providers as they address making changes to current law. Andrew and the staff at Hall Render are a great asset to us as we continue to work to grow the capacity and resources for SORH.”
The NOSORH Policy Committee meets the third Tuesday of every month to hear Washington updates, discuss strategy for growing SORH appropriations and reauthorization, and for regular updates from federal partners. Any SORH staff is welcome to join the call.
The following update was provided by Hall Render, NOSORH Legislative Liaison, on April 27th:
Congress Reaches Funding Agreement for FY 2017
On April 30, House and Senate leaders reached an agreement on the Fiscal Year (FY) 2017 funding through September 30. The deal will be finalized by the House and Senate during the first week of May.
The FY 2017 appropriations bill included $10 million in funding for the State Offices of Rural Health, an increase of almost $500,000 from FY 2016. Rural Outreach, Rural Hospital Flexibility Grants and Telehealth all received increased funding in the discretionary funding. More broadly, the Labor-Health and Education bill includes $161 billion in discretionary funding a reduction of $934 million below fiscal year 2016 and $2.86 billion less than what the Obama administration had sought. It includes no discretionary Affordable Care Act funding.
Congressional appropriators will now turn their focus to the FY 2018 spending bill which will need to be enacted by October 1, 2017.
TeleHealth Bill Introduced in the Senate
Leaders of the Senate Finance Committee introduced a bipartisan bill that would allow more Medicare dollars to flow into telemedicine. Among other provisions included in the chronic care legislation, the bill would provide ACOs more flexibility to provide telehealth services, allow beneficiaries receiving dialysis treatments at home to do their monthly check-in with their doctor by way of telehealth, rather than travelling to the doctor’s office or hospital. The bill would also expand the availability of telehealth to ensure individuals who may be having a stroke receive the right diagnosis and treatment.
The bill stems from the Senate Chronic Care working group which originally introduced this bill at the end of last Congress. Last week, Senator Gardner (R-CO) introduced a different telehealth bill (S. 787) that would require HHS to allow eligible hospitals to test telehealth services through CMMI.
House Bill Seeks to Extend Access to Physicians in Rural, Underserved Areas
Legislation was introduced in the House this week that would extend the Conrad State 30 program until 2021. The House bill would expand the number of J-1 visa waivers a state health department could request from 30 to 35 per year to work in federally designated Health Professions Shortage Areas or Medically Underserved Areas. The House bill (H.R. 2141) was introduced by Rep. Brad Schneider (D-IL) and Darrell Issa (R-CA). The bill is a companion to S. 898 which was introduced in the Senate in early April.
House Delays AHCA Vote
On April 27, House leadership delayed a vote on the American Health Care Act (AHCA) until at least next week. As of now, at least 15 House Republicans remain opposed, with another 20 undecided. Without Democrat support, House Republicans can only lose 22 votes.
Earlier in the week, several conservative groups including the House Freedom Caucus, dropped their opposition to the ACA repeal and replace bill as a result of compromise language being added to a revised version of the AHCA. The new language allows states to seek federal waivers from complying with certain insurance protections (essential health benefits, age rating, and medical underwriting under certain conditions).
However, ongoing concerns from more moderate House Republicans coupled with a lack of enthusiasm from a number of Republican governors kept the AHCA off the House floor for at least another week. Also, the Congressional Budget Office (CBO) has not scored the new language which could increase the number of uninsured. Were a House bill to pass, a number of Senate Republicans have indicated it will take at least a month for the Senate to pass their version of the AHCA. So, as the calendar turns to May, the effort to repeal and replace the ACA is still in a precarious spot.
Rural Health Related Bills Introduced this Month
Senator Shelley Moore Capito (R-WV) introduced a bill (S. 980) that would allow rural health clinics and federally qualified health centers to bill Medicare under Part B for hospice, which they currently can’t do. A similar bill (H.R. 1828) was introduced by Lynn Jenkins on the House side.
Rep. Tom Reed (R-NY) introduced the Rural Hospital Access Act (H.R. 1955) that seeks to make permanent the extension of the Medicare-dependent hospital program and the increased payments under the Medicare low-volume hospital program. A companion version was introduced in the Senate by Senators Charles Grassley (R-IA) and Chuck Schumer (D-NY).
Senator Cory Gardner (R-CO) introduced a bill that would require the Center for Medicare and Medicaid Innovation (CMMI) to test the effect of including telehealth services in Medicare health delivery reform models. According to the press release, the bill would require HHS to allow eligible hospitals to test telehealth services through CMMI.
The March meeting of the NOSORH policy committee included discussion on NOSORH’s strategy on an appropriation increase. Based on the current environment, the committee made a recommendation to the Board to adjust the request to Congress for SORH appropriation down to a $1 million increase for the SORH line. This is a decrease from the ask made during NRHA’s Policy Institute and hill visits. Members of Congress are preparing for appropriation requests and many have a process of receiving and vetting requests through a required form. It’s time for you to check in with your members and make requests. For help or questions, please contact Teryl Eisinger, Executive Director.
The following update was provided by Hall Render, NOSORH Legislative Liaison:
Appropriations Update: Funding for the federal government expires on April 28. Congressional leaders have indicated that their goal is to update fiscal year 2017 spending levels and not pass another continuing resolution. The procedural strategy is to group all remaining fiscal 2017 bills, which includes the Labor-HHS appropriations bill, into an omnibus and send it to the White House. Congressional leaders from both sides have indicated negotiations on the appropriations bill are progressing despite two potential hurdles.
The White House is asking Congress to cut $18 billion from discretionary spending bills for FY 17. The proposed cuts would be absorbed over the five months left in the current fiscal year. The Trump administration is calling for broad across the board cuts with the Labor-HHS spending bill seeing the steepest cuts. Much of the administration’s proposed cuts would come through grant funding. The second hurdle is the calendar, as Congress is scheduled to be in session for only eight legislative days in April.
Fiscal Year 2018 Budget Request: Earlier in March, the Trump Administration released a broad budget request to Congress. The blueprint proposes to cut HHS spending by 18 percent for fiscal year 2018. The plan sets HHS’ budget at $69 billion, a decrease of roughly $15 billion from 2017. The budget however does not touch Medicare or Social Security nor does it address changes to mandatory spending. The budget also doesn’t address specific funding levels for HHS programs and sub-agencies such as Health Resources Services Administration. The Trump Administration will address this in a more detailed budget that’s expected to be released in May.
The proposed HHS funding cuts has run into significant resistance from Congress. Members on both sides of the aisle have expressed concerns with the President’s proposed funding levels.
AHCA Pulled Before House Vote: On March 30, Republican leadership in the House pulled the American Health Care Act (AHCA) minutes before a vote was scheduled to take place. The move comes after Republican conservatives and moderates in the House found themselves unable to align on a bill that would repeal large portions of the ACA and significantly reform the Medicaid program.
Prior to the decision to the pull the bill, NOSORH wrote to Congress to express concerns about the impact the AHCA could have on rural communities. NOSORH wrote that in the AHCA’s current form, the bill could threaten the stability of the rural health system. Click here to read the letter.
Despite the significant setback, House Republicans met this week in attempt to find a solution on the repeal and replace of the ACA. While it’s unclear if the House leadership will attempt to bring an ACA repeal bill back to the floor this year, House Speaker Paul Ryan (R-WI) told reporters late Friday, “We’re going to be living with Obamacare for the foreseeable future.”
There are a number of reasons to be pessimistic about the chances of an ACA repeal bill getting done this year. The biggest being that the House Freedom Caucus (Caucus) has not changed their position and there is a belief that other than full repeal, there is little the Caucus can support. The White House has also indicated little appetite to bring back the ACA debate. The Trump Administration seems intent on moving to tax reform coupled with an infrastructure bill.
HHS Delays CMMIs Bundled Payments, 340B Ceiling Price, FDA Rule: On March 20, CMS published an interim final rule further delaying two Medicare bundled payment programs from the CMS Innovation Center (CMMI). The Federal Register Notice postpones an expansion of its bundled payment program for knee and hip replacements and the Cardiac Rehabilitation Incentive Payment Model. The programs were part of a final rule issued in December. While a member of Congress, HHS Secretary Tom Price was critical of CMMI’s mandatory demonstration programs.
On March 27, the Health Resources and Services Administration (HRSA) delayed implementation of the 340B ceiling price and civil monetary penalty rule. HRSA previously delayed implementing the rule from March 6 until March 21, and the interim final rule released on March 17 delays implementation until May 22. HRSA is also seeking comments on whether to further delay the rule until October. The rule, which was finalized shortly before the start of the Trump Administration, laid out penalties for manufacturers that “knowingly and intentionally” overcharge 340B providers. HRSA has also indicated it intends to take a broader look at the 340B program.
And on March 20, the FDA published a notice in the Federal Register delaying the implementation of the final rule regulating off-label drug promotion until March 19, 2018.
Rural Health Related Bills Introduced in March
Rep. Karen Bass (D-CA) introduced the Health IT Modernization for Underserved Communities Act. The bill (H.R. 1604) would amend title XIX of the Social Security Act to extend to physician assistants eligibility for Medicaid incentive payments for the adoption and use of certified electronic health records, whether or not such physician assistants practice at a rural health center or Federally qualified health center.
Senator Jon Tester (D-MT) introduced a bill (S. 455) that would amend title XVIII of the Social Security Act to count time spent in a critical access hospital as resident time spend in a non-provider setting for purposes of making Medicare direct and indirect graduate medical education payments.
Rep. Lynn Jenkins (R-KS) introduced a bill (H.R. 1284) that would amend title XVIII of the Social Security Act to provide that physician assistants can provide primary care to hospice patients, which is not currently covered under Medicare payment policy.