This week, our In Focus highlights a 杏吧视频 Institute on Addiction (HMA IOA) report, Delaware Substance Use Disorder Treatment System Needs Assessment, published in June 2022. HMA IOA conducted a statewide three-county substance use disorder (SUD) treatment system needs assessment in Delaware. This project began in November 2021 and was primarily funded by New Castle County with contributions from Kent and Sussex counties. The goal was to review the current state of the SUD treatment ecosystem, identify strengths and gaps collecting input from as many Delawareans across multiple sectors as possible, and make actionable recommendations to build a more robust and sustainable future state system.
The final analysis included interviews with key stakeholders, focus groups, a survey of all licensed SUD providers, claims data analysis, and a comparison of Delaware鈥檚 public (e.g., Medicaid) outpatient and residential SUD reimbursement rates with selected regional states. This approach provided a unique cross-sector view of where the most significant opportunities for improvement and investment may rest.
The areas of greatest experienced need in the system were reported as: inadequate treatment beds, especially for some populations, like children and youth; lack of residential 杏吧视频 for adults, especially those on Medicare and without insurance; needed supports for those experiencing negative impacts from social determinants of health (SDOH), like transportation and housing needs; lack of consistent access and care coordination; lack of adequate reimbursement to sustain the system or expand the treatment system; the need for trauma-informed care (TIC); and the need for more harm reduction and prevention strategies, including greater access specifically to Narcan 4mg Nasal Spray or its generic equivalent.
The study found that Delaware is meeting only 15 percent of SUD treatment needs and only meeting five percent of the need for the highest-intensity 杏吧视频, including inpatient treatment.
The results also showed an apparent discrepancy between what the state is working hard to implement to address the SUD and overdose crisis in Delaware and the community鈥檚 perception of, or lived experience with, those SUD treatment 杏吧视频 and supports. Additionally, HMA IOA heard about many treatment system strengths from interviewees, town hall participants, and focus groups and included recommendations that are meant to leverage those existing strengths in the future treatment system.
On August 18, 2022, the Centers for Medicare and Medicaid Services (CMS) released a 聽to support healthcare providers with preparing for the eventual end of the COVID-19 public health emergency (PHE) declaration. CMS also published a series of summarizing the status of Medicare Blanket waivers and flexibilities by provider type as well as flexibilities applicable to the Medicaid providers and stakeholders.
In its announcement, CMS expressed concern that the continued PHE flexibilities could contribute to further decline in patient, resident, and client safety beyond what has already been observed. As a result, the agency is cautiously working to balance ongoing PHE needs while conveying more urgency for providers to prepare for the eventual end of the PHE flexibilities and waivers.
CMS has already ended certain flexibilities and waivers. The agency could phase out other flexibilities as it prepares to let the PHE declaration lapse. This means that providers and health plans should act now to assess flexibilities and waivers in use and develop a plan to transition to post-PHE environment.
Phase-out of COVID-19 Flexibilities
During the COVID-19 PHE, CMS has utilized Medicare and Medicaid waivers and flexibilities extensively. For example, Medicare has not enforced certain federal requirements during this time to allow hospitals to utilize off-site locations to screen and treat patients when needed as well as to minimize certain reporting requirements. The agency鈥檚 flexibilities also have accelerated adoption of telehealth and audio only 杏吧视频, particularly for behavioral health 杏吧视频.
Medicare and Medicaid providers across the states utilized PHE flexibilities to varying degrees, in part depending on experiences in individual communities, capacity, and other provider specific factors. Additionally, over the course of the PHE health plan and provider staffing and workflows have changed dramatically. This means health plans and providers will need a tailored plan to support the transition to the post PHE environment.
HMA鈥檚 experts are working with hospitals, health systems, clinics, and other providers as well as health plans on the steps they need to take now to prepare for multiple transitions. Our experts identified six immediate steps that Medicare and Medicaid plans and providers can be undertaking now to ensure they can effectively return to normal operations, including:
Review performance on the patient and clinician safety metrics cited in the new CMS resources. In instances where providers have gaps and suboptimal safety and quality outcomes they will need assistance developing and implementing mitigation and quality improvement plans.
Utilize CMS鈥� tailored fact sheets to identify specific flexibilities and waivers in use now and the 鈥渘ormal鈥� federal regulations that will be in effect once the PHE lapses. This assessment should include the blanket waivers and provider specific flexibilities, including:
Flexibilities around the requirements and timing for practitioner training
Expansion of allowable sites of service that permitted more expansive use of telehealth and virtual 杏吧视频 as well as screening and treatment provided at alternative sites
Relaxation of federal requirements pertaining to surge capacity protocols
Flexibilities for staffing requirements, including medical records departments, nursing facilities, among others
Waiver of requirement for hospitals to submit occupational mix surveys and to have a utilization review plan with a UR committee focused on 杏吧视频 furnished to Medicare and Medicaid enrollees
Applicable of the Extreme and Uncontrollable Circumstances Policy in Medicare鈥檚 Shared Savings Program and use of other flexibilities for MSSP Accountable Care Organizations (ACOs)
Non enforcement of certain physician self-referral laws
Waiver of numerous reporting requirements including those pertaining to verbal orders, discharge planning, HEDIS and STARs measure reporting, among others
Project impact of ending Medicaid鈥檚 continuous coverage policy and support individuals with actions they may need to take at the end of the PHE. Once the PHE ends, Medicaid鈥檚 enhanced federal funding for states and continuous coverage policy will end. HMA is working with health plans, providers and other stakeholders to project how this change will impact the enrollment and payer mix on state and local levels. Additionally, patients and their caregivers will need support from plans, providers, and consumer groups to ensure they renew their coverage or transition to other coverage programs when needed. HMA鈥檚 experts have written extensively about our work to support the Medicaid unwinding activities in two blog posts – The PHE is continuing鈥攚hat鈥檚 next for Medicaid? and How stakeholders can prepare now for unwinding of Medicaid public health emergency continuous eligibility.
Develop a plan to transition from 鈥淧HE鈥� to 鈥減ost-PHE鈥� expectations that is informed by the assessment of flexibilities in use. Key components of the plan include:
Anticipated resource needs to reflect changes in staffing and workflows during the PHE
Articulation of specific compliance procedures and regular reporting requirements that will resume and the process for this transition
Develop training and education opportunities for staff that may be new or need refresher on normal policies and procedures as well as timeframes for making these changes
Update budgets projections to account for changes in reimbursement rates for certain 杏吧视频 post-PHE. Certain reimbursement amounts and payment methodologies will change post-PHE, such as payment for administering the COVID-19 vaccine in a Medicare patient鈥檚 home among other changes. Providers will need to project the financial impact of these payment changes and update coding and billing manuals and procedures where applicable.
Build strategies to sustain changes to care models implemented during the COVID-19 PHE while also addressing health disparities. Some providers and facilities adopted care models and modified existing ones during the PHE that may have improved patient outcomes and experiences, maximized expertise of practitioners, and improved value-based care. For example, some providers have embraced the Medicare Hospital Without Walls Initiative and will need to assess their options as some of those flexibilities are phased out. Other federal opportunities have newly emerged during the pandemic, such as the Rural Emergency Hospital designation and pending changes to the Medicare Shared Savings Program (MSSP).
What鈥檚 Next
The COVID-19 PHE declaration next expires on October 12, 2022. While a renewal of the PHE declaration is possible into early 2023, providers should be using this time to prepare for resumption of normal policies and procedures.
The expiration of PHE flexibilities and waivers are not, however, happening in a vacuum. Providers need to make this transition amidst a dynamic healthcare sector with high expectations for continuous improvement in quality, patient experiences, and value. During this transitional period HMA鈥檚 experts are working with health plans and providers to develop or revisit strategic plans and investments to refocus attention on improving models of care and value-based payment approaches, including strategies that will help mitigate health disparities.
This week, our In Focus section reviews preliminary 2021 Medicaid spending data collected in the annual CMS-64 Medicaid expenditure report. After submitting a Freedom of Information Act request to the Centers for Medicare & Medicaid Services (CMS), HMA received a draft version of the CMS-64 report that is based on preliminary estimates of Medicaid spending by state for federal fiscal year (FFY) 2021. Based on the preliminary estimates, Medicaid expenditures on medical 杏吧视频 across all 50 states and six territories in FFY 2021 was nearly $710.2 billion, with over 59 percent of the total now flowing through Medicaid managed care programs. In addition, total Medicaid spending on administrative 杏吧视频 was $30.8 billion, bringing total program expenditures to $741 billion.
Total Medicaid Managed Care Spending
Total Medicaid managed care spending (including the federal and state share) in FFY 2021 across all 50 states and six territories was $420.5 billion, up from $359.6 billion in FFY 2020. This figure includes spending on comprehensive risk-based managed care programs as well as prepaid inpatient health plans (PIHPs) and prepaid ambulatory health plans (PAHPs). PIHPs and PAHPs refer to prepaid health plans that provide only certain 杏吧视频, such as dental 杏吧视频 or behavioral health care. Fee-based programs such as primary care case management (PCCM) models are not counted in this total. Below we highlight some key observations:
Total Medicaid managed care spending grew 16.9 percent in FFY 2021. The rate of growth has been increasing since the COVID-19 pandemic. Prior to 2020, the rate had decelerated since FFY 2016.
Managed care spending growth was due in large part to the COVID-19 pandemic and the resulting higher Medicaid enrollment.
In terms of dollars, the increase in Medicaid managed care spending from FFY 2020 to FFY 2021 was $60.9 billion, compared to $46.1 billion from FFY 2019 to FFY 2020.
Medicaid managed care spending has increased at a compounded annual growth rate (CAGR) of 16.1 percent since FFY 2007, compared to a 6.6 percent growth in total Medicaid spending.
Compared to FFY 2020, Medicaid managed care spending as a percent of total Medicaid spending in FFY 2021 increased by 3.8 percentage points to 59.2 percent.
Figure 1: Medicaid MCO Expenditures as a Percentage of Total Medicaid Expenditures FFY 2007-2021 ($M)
As the table below indicates, 69.4 percent of FFY 2021 spending came from federal sources, which is 12 percentage points higher than the pre-Medicaid expansion share in FFY 2013, and 1.8 percentage points higher than FFY 2020.
Figure 2: Federal vs. States Share of Medicaid Expenditures, FFY 2013-2021 ($M)
State-specific Growth Trends
Forty-five states and territories report managed care organization (MCO) spending on the CMS-64 report, including Alaska, which utilizes a PIHP/PAHP model exclusively. Oklahoma is expected to implement a Medicaid managed care program in 2023. Of the remaining 44 states and territories that contract with risk-based MCOs, average MCO spending in FFY 2021 increased 17.6 percent. On a percentage basis, North Carolina experienced the highest year-over-year growth in Medicaid managed care spending at 63.3 percent due to the implementation of its risk-based Medicaid managed care program. Among states with more mature programs, Colorado experienced the fastest growth in FFY 2021 at 59 percent, followed by Nebraska at 55.6 percent.
The chart below provides additional detail on Medicaid managed care spending growth in states with risk-based managed care programs in FFY 2021.
Figure 3: Medicaid Managed Care Spending Growth on a Percentage Basis by State FFY 2020-21
Source: CMS-64; *Note: Not all states are included in the table.
Looking at year-over-year spending growth in dollar terms, Illinois experienced the largest increase in Medicaid managed care spending at $5.5 billion. Other states with significant year-over-year spending increases in dollar terms included Texas ($5.2 billion), California ($5.2 billion), and New York ($5.1 billion). The chart below illustrates the year over year change in spending across the states.
Figure 4: Medicaid Managed Care Spending Growth on a Dollar Basis by State FFY 2020-21 ($M)
Source: CMS-64; *Note: Not all states are included in the table.
The percentage of Medicaid expenditures directed through risk-based Medicaid MCOs increased by more than five percentage points in 14 states from FFY 2020 to FFY 2021. The managed care spending penetration rate rose 13.4 percentage points in the District of Columbia, 9.7 percentage points in Indiana, 9.5 percentage points in Nebraska, 9.2 percentage points in North Carolina, and 9.1 percentage points in Illinois.
Figure 5: Medicaid MCO Expenditures as a Percentage of Total Medicaid Expenditures in States with a 5 percent or Greater Increase from FFY 2020 to FFY 2021 ($M)
Source: CMS-64
The table below ranks the states and territories by the percentage of total Medicaid spending through Medicaid MCOs. Iowa reported the highest percentage at 97.2 percent, followed by Puerto Rico at 95 percent, and Hawaii at 94.4 percent.
We note that in many states, there are certain payment mechanisms which may never be directed through managed care, such as supplemental funding sources for institutional providers and spending on retroactively eligible beneficiaries. As a result, the maximum achievable penetration rate in each state will vary and may be below that achieved in other states. The Medicaid managed care spending penetration rate is greatly influenced by the degree to which states have implemented managed long-term 杏吧视频 and supports (MLTSS) programs.
Figure 6: Medicaid MCO Expenditures as a Percent of Total Medicaid Expenditures, FFY 2016-2021
Non-MCO Expenditures
Despite the rapid growth in Medicaid managed care over the last 10 years, program spending still represented approximately 59 percent of total Medicaid expenditures in FFY 2021. So where is the remaining fee-for-service (FFS) spending (approximately $291 billion) going? First, as noted above, there are many states/territories with Medicaid managed care programs in which certain beneficiaries or 杏吧视频 are carved-out of the program, and these are typically associated with high-cost populations. The total amount of non-MCO spending in the 44 states with risk-based managed care in FFY 2021 was $260.4 billion. Assuming an average 鈥渇ull penetration鈥� of 85 percent of total Medicaid spending, then HMA estimates that an additional $221 billion in current FFS spending could shift to a managed care model just in the states that already employ managed care for a subset of 杏吧视频 and/or beneficiaries.
Thirteen states/territories did not utilize a comprehensive risk-based managed care model in FFY 2020. In general, the 13 states/territories that do not utilize managed care today are smaller states. Oklahoma, with $5.3 billion in Medicaid spending is expected to shift to risk-based Medicaid managed care in 2023. Total Medicaid spending across all 13 non-managed care states/territories was $29.8 billion. The 13 states/territories that did not employ a risk-based comprehensive Medicaid managed care model in FFY 2021 were Alabama, Alaska, American Samoa, Connecticut, Guam, Maine, Montana, Northern Mariana Islands, Oklahoma, South Dakota, Vermont, Virgin Islands, and Wyoming.
In terms of spending by service line, the largest remaining FFS category is home and community-based 杏吧视频 at $69.5 billion, which accounts for 24 percent of FFS spending. Inpatient hospital 杏吧视频 represent 21 percent of FFS spending at $60.8 billion.
Figure 7: Fee-for-Service Medicaid Expenditures by Service Line, FFY 2021
While the CMS-64 report provides valuable detail by service line for all FFS expenditures, it does not capture how spending directed to Medicaid MCOs is allocated by category of service. Therefore, it is not possible to calculate total MCO spending by service line, a challenge that will only intensify as more spending runs through MCOs.
This week, our In Focus section highlights an HMA Issue Brief, Bolstering the Youth Behavioral Health System: Innovative State Policies to Address Access & Parity, published in August 2022. The brief examines policies aiming to advance access and availability of behavioral health 杏吧视频 (encompassing mental health and substance use disorders) for youth. Below we explore opportunities for states to adopt levers to ensure access to the full continuum of children鈥檚 behavioral health 杏吧视频. States should consider developing a multi-faceted strategy to address accessibility issues including:
A policy mechanism for insurance coverage and funding for infrastructure, support and 杏吧视频 across behavioral health, child welfare and Medicaid
A robust delivery system for provision of 杏吧视频
Comprehensive benefit design
A mechanism to monitor network adequacy, access, and parity
The COVID-19 pandemic has exacerbated rates of depression, anxiety, and other behavioral health issues among youth 鈥� with suicide now the second leading cause of death among ages 10-12. Pre-pandemic, 1 in 5 children experienced a mental health condition every year and only 54 percent of non-institutionalized youth enrolled in Medicaid or CHIP received mental health treatment. Between March 2020 to October 2020, mental health鈥搑elated emergency department visits increased 24 percent among youth ages 5 to 11 and 31 percent among ages 12 to 17, compared with 2019 emergency department visits.
Youth covered by Medicaid and the State Children鈥檚 Health Insurance Program (CHIP), and the Early and Periodic Screening, Diagnostic and Treatment (EPSDT) of the Medicaid Act require state Medicaid agencies to provide enrollees under age 21 with access to periodic and preventive screenings, and 杏吧视频 that are necessary to 鈥渃orrect or ameliorate鈥� medical conditions, including other additional health care 杏吧视频 such as behavioral health conditions. It remains the responsibility of states to determine medical necessity on a case by-case basis. As of 2020, states are mandated to submit a CHIP state plan amendment to demonstrate compliance with the new behavioral health coverage provisions. However, behavioral health 杏吧视频 are not a specifically defined category of benefits in federal Medicaid law and coverage of many 杏吧视频 is at state discretion. The 2008 Mental Health Parity and Equity Act (MHPAEA) requires that Medicaid managed care and private health insurers who do reimburse for behavioral health 杏吧视频 provide behavioral health benefits to cover mental health and substance use 杏吧视频 that is no more restrictive than the coverage generally available for medical and surgical benefits. While MHPAEA was designed to reduce inequities in coverage between behavioral and physical health 杏吧视频, it does not reduce inequities in reimbursement as payers are not required to cover behavioral health 杏吧视频.
Ambitious efforts are underway to prioritize behavioral health 杏吧视频 for youth. The Department of Health and Human Services (HHS) recently called for states to prioritize and maximize efforts to strengthen youth mental health. The American Academy of Pediatrics (AAP), American Academy of Child and Adolescent Psychiatry (AACAP) and Children’s Hospital Association declared a national emergency in children’s mental health. In addition, passage of the Bipartisan Safer Communities legislation includes significant funding for mental health screening, expansion of community behavioral health center (CCBHC) model; improving access to mental health 杏吧视频 for children, youth, and families through the Medicaid program and CHIP; increasing access to mental health 杏吧视频 for youth and families in crisis via telehealth; and investments to expand provider training in mental health, supporting suicide prevention, crisis and trauma intervention, and recovery.
With suicide now the among children, adolescents, and young adults (aged 15-24 years old) in the United States, it is apparent that the COVID-19 pandemic has not only exacerbated rates of depression and anxiety, but also illuminated the fractures in our youth behavioral health system. In response, states are focusing on ways to advance policies that aim to expand coverage for youth mental health 杏吧视频.
Individuals suffering from mental health conditions or substance use disorders (SUDs) face many challenges accessing care and often do not seek treatment. Even before the COVID-19 pandemic, Centers for Disease Control and Prevention (CDC) data found 1 in 5 children were diagnosed with a mental health disorder, yet only 20% of those children received appropriate care.
In the past two years, over 100 laws in at least have been enacted with a focus on supporting schools to act as a primary access point for youth behavioral health care. At least half of all states are applying the co-location approach, where both types of care are delivered at the same site, to better integrate physical and behavioral health care. According to the Kaiser Family Foundation , more than four-fifths of states launched initiatives related to screening for behavioral health needs, an effective strategy for Medicaid to connect those with behavioral health needs to the appropriate 杏吧视频.
Medicaid plays a pivotal role as , including both mental health and SUD 杏吧视频. Efforts to address these issues have been a focus in Medicaid at the federal level, including in the 2018 SUPPORT Act and more recently in the 2021 American Rescue Plan Act (ARPA), which provided enhanced Medicaid funding for certain behavioral health providers and mobile crisis 杏吧视频. The Center for Medicare & Medicaid Services (CMS) under the Biden Administration has highlighted policy and investments as a federal Medicaid priority.
During National Mental Health Awareness Month, the Department of Health and Human Services (HHS) called for states to strengthen youth mental health and detailed HHS鈥� plans to support state-wide coordination across federal funding streams to expand youth mental health 杏吧视频. This blog highlights California’s approach and spotlights other states鈥� efforts to bolster the children’s behavioral health system.
State Strategies to Strengthen the Youth Behavioral Health System
There has been significant work underway in California for years to address youth behavioral health 杏吧视频, but up until recently it did not include substantial investments to redesign the mental health system for youth, and families. California exemplifies ways to leverage policy levers and make significant state investments to cultivate and strengthen the youth behavioral health system.
In 2021, California enacted groundbreaking legislation by making significant investments to reimagine its youth behavioral health system. The is a $4.4B investment intended to enhance, expand, and redesign the systems that support behavioral health for youth, children and families. This initiative, administered by the California Health and Human Services Agency and its departments, aims to evolve 颁补濒颈蹿辞谤苍颈补鈥檚 behavioral health system in which all children (25 years of age and younger) regardless of payer, are served for new and existing behavioral health needs.
This seeks to enhance and redesign the current behavioral health system by integrating behavioral health into physical health, education, and other areas that support children and families. With a stronger focus on prevention and early intervention, the Initiative will distribute school-linked partnership, capacity, and infrastructure grants to support implementation of the initiative for behavioral health 杏吧视频 in schools and school-linked settings.
The Initiative will also provide to qualifying Medi-Cal (Medicaid) managed care plans to establish interventions that expand access to preventive, early intervention, and behavioral health 杏吧视频 for children in publicly funded childcare and preschool, as well as pre-K-12 children in public schools. Also included are efforts to submit a State Plan Amendment to incorporate the under Medi-Cal, whereby screening for behavioral health problems, interpersonal safety, tobacco and substance misuse and social determinants of health are provided for the child and caregiver or parent during medical visits. A key piece of the Initiative stipulates that every component outlined in the Children and Youth Behavioral Health Initiative Act may only be implemented if the Department of Health Care Services confirms that federal financial participation under the Medi-Cal program will not be jeopardized. Indeed, the intricate design and implementation of the Initiative would not be possible without partnerships from other State agencies, education stakeholders, subject matter experts, and community partners to deliveressential 杏吧视频 from prevention to treatment and recovery.
California’s commitment to address youth behavioral health 杏吧视频 at a statewide level illustrates the various efforts emerging across the country. California is one state that is advancing multi-faceted strategies through legislation and Medicaid, but other states have used various Medicaid authorities including , State Plan Amendments (SPAs), and 1915(c) Waivers to remove accessibility roadblocks and enhance youth behavioral health 杏吧视频. States have taken a variety of approaches in their commitments to bolster the system of care around the country that include:
amended its state plan amendment to expand the EPSDT benefit to enable a greater focus on prevention, early intervention, and expansion of behavioral health 杏吧视频.聽
amended its state plan to make Mobile Response and Stabilization Services (MRSS) for youth up to age 21 reimbursable under Medicaid鈥檚 EPSDT benefit.
Ohio RISE (Resilience through Integrated Systems and Excellence) for youth with complex behavioral health needs was enacted through a Medicaid 1915c waiver. Through this program, a single managed care organization provides new, targeted behavioral health 杏吧视频 and intensive care coordination
Washington State passed the (Chap. 263, Laws of 2022) to ensure coverage for all emergency behavioral health 杏吧视频 (adult and children) to protect consumers from charges for out-of-network health care 杏吧视频 by addressing coverage of emergency BH 杏吧视频.
Moving Ahead
States can combine the power of their policy levers along with the cascade of forthcoming federal dollars to strengthen the youth mental health system of care. The includes significant funding for mental health screening, among other critical 杏吧视频. The Bipartisan legislation seeks to foster the tremendous opportunity for states and schools to increase behavioral health capacity for students and mental health professionals, evidenced by the School Based Mental Health Services (SBMHS) Grant Program, the School Based Mental Health Service Professionals Demonstration Grant, and several other investments for supportive 杏吧视频 in schools.
Ensuring equitable access to a plethora of high-quality behavioral health 杏吧视频 for youth requires the individual and collective commitment of states. The children鈥檚 mental health crisis has reached unprecedented levels and the opportunity for states to lead by example has arrived. Fortunately, states have significant tools to address the youth mental health crisis through the design and deployment of innovative policies and mission-aligned collaborations. Federal funds and state policy levers will help advance a robust and accessible children鈥檚 behavioral health system. As our communities work to rebuild in a post-pandemic world, states have the unique opportunity to provide today鈥檚 youth with compassion, essential behavioral health resources, and integrated systems to meet them where they are.
On August 7, 2022, the Senate passed the Inflation Reduction Act of 2022 (the IRA). The House approved the bill on August 12, and President Biden is expected to sign the IRA into law in the coming weeks.
The IRA addresses a range of policy topics across health care climate, energy, and taxation. Regarding health care, the IRA makes structural changes to the Medicare Part D prescription drug benefit and provides new authority for the Medicare program to address the pricing of prescription drugs in the Part B and Part D programs. The measure also extends the temporary enhanced assistance for health coverage purchased from Marketplaces, which was first approved in the American Rescue Plan Act (ARPA). In addition, the IRA updates vaccine coverage policies in Medicare, Medicaid, and the Children鈥檚 Health Insurance Program (CHIP).
While the IRA provides a critical framework for the structural changes to the nation鈥檚 largest public health insurance programs, the U.S. Department of Health and Human Services will be responsible for building out the policy and operational components necessary to support implementation.
Notably, the Centers for Medicare and Medicaid Services (CMS) will lead implementation of the IRA鈥檚 Medicare and Marketplace provisions. The changes to the Part D benefit and the development of entirely new processes and policies to support the IRA鈥檚 drug pricing provisions require significant resources and consideration of direct as well as indirect impacts for the health care market. The agency can use a variety of regulatory tools to support implementation, including issuing standalone Requests for Information (RFIs), convening stakeholder engagement sessions, updating policy manuals, and undertaking notice and comment via the formal rulemaking process, among others.
CMS鈥� strategic plan emphasizes the value of stakeholder engagement, and this is likely to lead to multiple opportunities for public input, particularly as CMS implements the new Medicare provisions of the IRA. For example, the agency must develop the policy parameters for reforming the Part D benefit design and is likely to seek input from Medicare Advantage (MA) and MA Prescription Drug Plans (MA-PDPs), providers, vendors, and consumer advocacy groups among others to inform its approach. CMS will also need input from the stakeholder community as it establishes the timelines, reporting, and negotiating mechanisms impacting Part B and D prescription drugs pricing and how it will implement the inflation penalty policies outlined in the IRA.
The IRA鈥檚 extension of the American Rescue Plan Act鈥檚 (ARPA) enhanced eligibility for premium assistance through 2025 provides more near certainty around eligibility and enrollment for this market. This may led to renewed momentum for CMS to engage with states and stakeholders on Marketplace policies and structures.
Many of the details around how the IRA鈥檚 health care policies will be implemented are unknown at this time. Stakeholders will want to monitor CMS鈥� progress and provide feedback with data-informed analysis and concrete and practical recommendations as these opportunities are announced.
An overview of many of the IRA鈥檚 health care provisions follows. Our team of experts can provide tailored analysis and support to clients as they begin to unpack the full breadth of the IRA鈥檚 policy changes and implications for Medicare Advantage and Part D plans, providers, vendors, consumer advocacy groups and other stakeholders.
Part B and Part D Drug Pricing. Requires the Secretary of HHS to select a list of drugs eligible for negotiation, and enter into agreements with select manufacturers, negotiating a 鈥渕aximum fair price鈥� (MFP) for each selected drug in the Medicare program. The Secretary is required to negotiate on a certain number of drugs per year, 10 drugs in 2026; 15 drugs in 2027 and 2028, and 20 drugs in 2029 and subsequent years. The number of drugs negotiated will accumulate over the years, such that up to 60 drugs could be negotiated by 2029. Manufacturers who are not in compliance will face an excise tax that could far exceed the cost of drugs sold over time and civil monetary penalties.
Prescription Drug Inflation Rebates. Requires manufacturers to pay rebates for Medicare Part B and D drugs with prices rising faster than inflation. The rebate calculation would be based on units and pricing in Medicare and would determine an inflation-adjusted payment amount based on the percentage by which the price exceeds the inflation benchmark, as determined by the Consumer Price Index for All Urban Consumers (CPI-U). If a manufacturer fails to pay the rebate, then they would be subject to a civil monetary penalty either equal to or at least 125 percent of the rebate amount for the quarter.
The Part D inflation rebate takes effect October 2022 for Part D drugs and biologics.
The Part B inflation rebate begins January 2023 for single-source drugs or biologics and certain biosimilar products. The IRA also includes an inflation growth cap on beneficiary coinsurance in Part B, beginning April 2023.
Part B Payment for Biosimilar Biological Products. Amends Medicare鈥檚 Average Sales Price (ASP) payment methodology in cases where the ASP during the first quarter of sales is unavailable to establish a payment rate for biosimilars. The IRA also updates Medicare Part B reimbursement for certain biosimilar products for a five-year period beginning on October 1, 2022, by increasing the add-on payment from six percent of the reference product鈥檚 ASP to eight percent of the reference product ASP.
Medicare Part D Assistance for Beneficiaries and Benefit Design. Increases the qualifying income amount (federal poverty level (FPL)) for the full Low-Income Subsidies (LIS) under Part D, from 135 percent of the FPL to 150 percent of the FPL, starting in 2024. The IRA also adjusts the cost-sharing requirements in the Part D benefit by:
Eliminating cost sharing in the catastrophic phase of the benefit in 2024;
Setting an annual out-of-pocket (OOP) limit for enrollees at $2,000 beginning in 2025;
Capping monthly premium increases for a prescription drug plan in 2024 through 2029 at six percent per year. The Secretary may make a one-time adjustment to the beneficiary Part D premium contribution percentage in 2030 to ensure longer-term beneficiary premium reduction; and
Adjusting the benefit coverage liabilities for the initial coverage phase and catastrophic coverage phase.
Coverage for Insulin. Requires Medicare to cover select insulin products and not apply a deductible or impose cost-sharing more than $35 or 25 percent of the negotiated price (including all discounts) for a 30-day supply. Beginning in July 2023, Medicare must exempt from beneficiary deductibles insulin provided through durable medical equipment (DME) and ensure that coinsurance for a month鈥檚 supply of insulin administered through DME does not exceed $35. High-deductible health plans (HDHPs) will be able to cover selected insulin products with no deductible without impacting their status as a HDHP, starting in 2023.
Medicare, Medicaid, and CHIP Coverage for Vaccines. Requires full coverage of Advisory Committee on Immunization Practices (ACIP)-recommended adult vaccines under Medicaid and CHIP without cost-sharing. The IRA also increases the Federal Medical Assistance Percentage (FMAP) by one percentage point, for adult medical assistance for such vaccines and their administration, during the first eight fiscal quarters on or after the date of the IRA鈥檚 enactment.
Requires Medicare Part D provide full coverage without cost sharing of ACIP-recommended adult vaccines for plan years beginning on or after January 1, 2023.
Enhanced Temporary Assistance for Marketplace Coverage. Extends the ARPA鈥檚 expansion of Advanced Premium Tax Credit (APTC) eligibility and amounts through 2025. ARPA modified the affordability percentages used for the calculation of APTC to increase subsidy amounts for individuals eligible for assistance.
Experts from HMA and HMA companies are supporting clients as they begin to strategize and formulate initial recommendations for federal agencies and plan for implementation. We will continue to monitor developments in this area and provide additional updates as more information becomes available.
As the urgent needs of COVID-19 Public Health Emergency (PHE) continue to subside, state Medicaid agencies are exploring pathways and concepts to further address the historic inequities and health disparities laid bare by the pandemic. These efforts are closely aligned with the current Administration鈥檚 for the Medicaid program, specifically:
Addressing health equity
Improving access and coverage
Promoting whole person care
For several decades, Medicaid Section 1115 demonstration programs have provided a powerful lever for federal and state policymakers to design, implement, and evaluate transformative initiatives. All states administer at least one Section 1115 demonstration program. Some demonstrations are narrowly tailored to address 杏吧视频 or populations while others capture broader features pertaining to coverage, benefits, and payment and delivery system innovations.
Notably, a new wave of comprehensive and transformative Medicaid Section 1115 demonstration proposals is emerging.
Working closely with the Centers for Medicare and Medicaid Services (CMS), states are developing proposals that place individuals at the center of health care in an entirely new way 鈥� by recognizing their medical needs as well as the complexity of circumstances and environmental factors that shape the individual鈥檚 medical, physical, and behavioral care needs and outcomes.
Teams of experts from across the HMA family of companies are supporting state agencies, counties, health plans, providers, community and consumer organizations, and other stakeholders with translating federal goals and parameters into concrete proposals as these move through the stages of concept paper, application and negotiation, and implementation. Demonstrations will reflect each state鈥檚 unique political and policy landscapes, but the programs will be grounded in certain federal goals and expectations to enhance accountability and improve outcomes.
Our experts identified three trends in state 1115 demonstration programs. In this and subsequent In Focus posts we will share our team鈥檚 initial insights and considerations for stakeholders based on our collective 鈥渙n the ground鈥� expertise. We include illustrative examples from some states with approved and pending Section 1115 proposals.
Section 1115 Trend #1: States are advancing a new vision for Medicaid鈥檚 role in addressing health equity, influenced by social drivers and grounded in a community鈥檚 needs.
CMS is strongly encouraging states to consider initiatives that address health inequities and community specific social drivers of health. As evidenced by the current state initiatives, Section 1115 demonstration programs will be a primary 鈥� but not the only 鈥� pathway states utilize to design strategies to address health inequities driven by non-health systems and circumstances. Based on our work with states and stakeholders, it is critical that states ensure the 杏吧视频 are directly linked to factors that impact health outcomes for Medicaid enrollees and that they have mechanisms to evaluate the impact of community and social care 杏吧视频.
Several state proposals already signal CMS鈥� current vision for using Section 1115 authority to test new types of assistance within service categories to include non-medical 杏吧视频, 杏吧视频 tailored to populations, and assistance that is linked to desired outcomes. For example:
Section 1115 pilot program will provide support to certain groups of consumers for an array of community supports ranging from housing related 杏吧视频 and transportation access to interpersonal violence and access to food and nutrition 杏吧视频. The program includes help for consumers related to utility set up and moving costs, and support to connect with community 杏吧视频 to address legal issues impacting housing and thereby impacting health.
In December 2021, CMS approved Section 1115 demonstration program and linked this to a separate waiver approval allowing the state to further enhance 杏吧视频 and accountability within its managed care program. As part of 颁补濒颈蹿辞谤苍颈补鈥檚 implementation of its statewide whole person care initiative, the state will be able to pay for housing navigation and tenancy 杏吧视频 and assistance with first month deposits for certain populations enrolled in its statewide managed care program. This proposal is grounded in the state鈥檚 commitment to ensure that the non-medical 杏吧视频 were clearly defined and clinically oriented for the intended population.
CMS鈥� approval of the North Carolina and California programs is paving the way for conversations in other states, including , , and among others. Negotiations on similar initiatives to address health equity in other states, include:
New York, like North Carolina, plans to seek CMS鈥� approval to offer a range of community 杏吧视频 that would be provided through newly established networks of community-based organizations in all regions of the state. The state envisions that the CBO networks will include small neighborhood organizations familiar with their communities鈥� needs and the capacity to address multiple social risk factors as well as larger county or regionally focused entities. In addition, New York is asking CMS to support a health equity focused proposal which would provide certain 鈥渋n-reach鈥� 杏吧视频 for incarcerated individuals before they are released.
Oregon submitted a request to use federal Medicaid spending authority to address community-based health inequities and to establish statewide health equity investments (HEIs). The state is especially focused on supporting consumers during disruptions in coverage, life transitions, or disruptions caused by climate events. Community-based investments will reflect empirical evidence and community assessments and may include efforts to improve building environments and expand culturally and linguistically. Addressing climate events may be of particular interest as it addresses multiple priorities for Administration.
Conclusion
North Carolina and California offer important insights into what may be possible and as importantly, what may be beyond the bounds of CMS鈥� Medicaid authority. Chief among the outstanding issues for states and stakeholders is whether additional innovative programs for addressing health disparities among justice-involved populations is possible under Medicaid鈥檚 demonstration authority.
CMS may use the experience with initial states to provide more concrete information on these general parameters and expectations. Formal guidance would prove helpful to states and stakeholders seeking to apply new knowledge and experiences with health inequities into practice within the Medicaid programs.
HMA鈥檚 interdisciplinary teams of Medicaid, human 杏吧视频, and actuarial experts are assisting states as well as stakeholders as they conceptualize, develop, and implement Section 1115 programs. To learn more about our work and the breadth of our service, contact our expert below.
This week, our In Focus section reviews the (RFI) on ways to strengthen the Medicare Advantage (MA) program, released by the Centers for Medicare & Medicaid Services (CMS) on July 28, 2022. CMS鈥檚 intent is to better align the MA program with the agency鈥檚 Vision for Medicare and the CMS . The agency is strongly emphasizing the importance of stakeholder comments for this process. This openness to feedback presents MA plans, providers, and other stakeholders an opportunity to inform the agency鈥檚 early thinking as it considers potential regulatory actions impacting supplemental benefits, value-based contracting arrangements, risk adjustment, prior authorization, and marketing among other issues.
The questions are grouped into five categories. Throughout each section CMS seeks to better understand operational issues and insights from past or ongoing experiences tackling health equity issues in states and communities. Below we describe several of the questions and themes within each category:
Advance Health Equity: This extensive set of questions is intended help CMS better understand MA plans鈥� specific programs, screenings, benefits, and data that are components of addressing health equity and how the agency can better ensure that all MA enrollees receive the care they need. CMS also is seeking to better understand the collaborations and reimbursement arrangements between MA plans and providers that partner with community-based organizations, particularly as these arrangements become more central to efforts to address social drivers of health. The agency continues to focus on the dual eligible population, and asks specifically how it can support efforts by Special Needs Plans to provide targeted, coordinated care for enrollees.
Expand Access: Coverage and Care: In this section CMS explores MA plans鈥� marketing efforts, including the tools beneficiaries use and how plans differentiate themselves to beneficiaries, as well as factors for building and changing plan networks. Additionally, CMS poses many questions about supplemental benefits, including questions about how MA plans design supplemental benefits, how they inform beneficiaries about these benefits and whether there are evaluations or data elements that are used. CMS also anticipates receiving information on how it can ensure that enrollees have access to the covered behavioral health 杏吧视频 they need, access and use of telehealth 杏吧视频.
Drive Innovation to Promote Person-Centered Care: Last year, CMS committed to ensuring that 100 percent of Medicare beneficiaries were in accountable care relationships by 2030. This will require changes for more than 30 percent of Medicare beneficiaries. To date, much of the attention around this goal has been focused on fee-for-杏吧视频 arrangement. With this RFI, CMS is turning its attention to value-based arrangements in MA. Specifically, it asks stakeholders about the factors driving MA plans and providers participating in value-based contracting. The agency wants to better understand the data that is crucial for value-based contracting and the experiences of MA plans in trying to align with value-based contracting in other Medicare programs/models, Medicaid, and the commercial payers. Stakeholders also have an opportunity to provide input on how CMS could better support efforts of MA plans and providers to appropriately and effectively collect, transmit, and use appropriate data as well as potential new tops of payment or service delivery models that could be tested.
Support Affordability and Sustainability: This set of questions turns to payment and competition in the marketplace. Specifically, the agency asks for input on potential methodologies to ensure risk adjustment is accurate and sustainable. CMS also wants to understand how stakeholders are thinking about the relationship between risk adjustment and health equity and addressing social determinants of health SDOH. The agency also wants to consider specific local market barriers to entry and advantages and disadvantages in different markets.
Engage Partners: This group of questions provides an opportunity for stakeholders to address information gaps for Medicare beneficiaries. The agency also is interested in how it could promote collaboration among MA stakeholders.
Why It Matters:
As the urgent issues with the pandemic continue to ease, CMS is turning its attention to proposals that could help refocus the Medicare program, including Medicare Advantage, to address health equity, quality, and affordability.
Stakeholders will want to carefully consider how they could use their RFI responses to shape the agency鈥檚 potential future proposals. Health plans, providers, community organizations, and vendors have an opportunity to highlight concepts, tools, and other innovations that have proven successful and scalable.
Specific concrete examples of the impact on Medicare beneficiaries would be highly valued by the agency. It will also be important to focus responses on regulatory policy changes and actions that CMS can advance with its existing authority.
HMA experts can assist stakeholders with their responses on these impactful issues including but not limited to:
Innovations stakeholders have tried, barriers to concepts and needs they have identified, and other ideas on flexibilities for local partnerships and technology.
Approaches to improve the MA experience for the Medicare and Medicaid dually eligible population and rural communities.
New risk adjustment methods.
Potential improvements to the MA quality program.
Strategies for improving the beneficiary enrollment process.
The value and opportunity of using technology and telehealth and how these impact the design of provider networks.
Framing the factors and dynamics around MA plan and provider value-based contracting.
What鈥檚 Next
CMS is accepting comments on this RFI until August 31, 2022. The agency could use input it receives to develop proposals for at least the next two regular rulemaking cycles for the Medicare Advantage program, issue policy proposals outside of the normal rulemaking, or both.
HMA experts are available to provide strategic assistance with framing and developing responses as well as analysis to reinforce points and recommendations to the agency for this expedited RFI response timeline.
Meena Seshamani, deputy administrator and director of the Center for Medicare at the Centers for Medicare & Medicaid Services, will deliver a virtual keynote address on The Future of Medicare Value-Based Payments at the HMA conference, October 10-11, 2022, at the Fairmont Chicago, Millennium Park.
To register, visit .
The overall theme of this year鈥檚 conference is How Medicaid, Medicare, and Other Publicly Sponsored Programs Are Shaping the Future of Healthcare in a Time of Crisis. More than 40 speakers are confirmed, and more than 400 people are expected to attend.
Over the course of three weeks CMS has made a series of Medicare announcements that arguably contain the most sweeping changes to the Medicare program proposed thus far by the Biden Administration. With final Medicare payment rules on the horizon, CMS is poised to further the Biden Administration鈥檚 directional imprint on the Medicare program. The recent releases include:
A focused on rural hospitals designed to preserve 鈥揳nd likely expand 鈥� access to 杏吧视频 in rural communities;
A proposed payment and policy for outpatient and ambulatory care 杏吧视频 also lays the groundwork for new transparency and competition initiatives;
Significant to most aspects of Medicare鈥檚 accountable care organizations; and
New opportunities to support oncology providers in moving towards a whole person approach to 杏吧视频 through the .
For this blog our HMA experts focus on the 2,000+ page Calendar Year (CY) 2023 Medicare Physician Fee Schedule (PFS) proposed released to the public on July 7, 2022. The Medicare Physician Fee Schedule and its accompanying proposed policy changes is a significant tool CMS uses to advance annual updates in reimbursement policy and to consider other policy changes in traditional Medicare that have implications for the program writ large.
Generally, in the CY 2023 proposed rule the Administration is continuing to broaden and deepen the way it applies its health equity framework to the entirety of the proposals, strengthens access to behavioral health 杏吧视频, and reinvigorates value-based care through the Medicare Shared Savings Program鈥檚 (MSSP) Accountable Care Organizations (ACOs) structure.
The rule includes a myriad of other policy proposals. We highlight a few of the key ones below. For example, CMS must make updates to the physician fee schedule conversion factor which has ripple effects throughout the Medicare program. The agency is also proposing updates to reimbursement for certain telehealth 杏吧视频 and coverage enhancements for hearing and dental 杏吧视频, among many others proposals.
Key Action Items for Stakeholders
All comments to the rule are due to CMS by September 6, 2022. CMS plans to publish the final rule in late fall 2022.
The public comment opportunity is essential for CMS to deepen its understanding of the impact of the proposals. The agency considers stakeholders鈥� concerns, questions, and other feedback as it makes decisions on which proposals to finalize, modifications to the proposals, or to defer implementation.
This is also an important window of opportunity during which stakeholders can analyze the impact of the proposals and the business decisions these may require, plan advocacy around the proposed changes, and prepare for implementation which generally will occur on January 1, 2023.
Many leading national provider organizations are making their concerns with the annual payment update a central piece of their advocacy agenda in Congress. These concerns will add to the long list of structural issues that Congress is expected to debate leading up to and well after this year鈥檚 mid-term elections. However, providers still need to weigh the inflation pressures and uncertainty surrounding Congress鈥� ability to intervene with new opportunities in the Medicare program and Medicare Advantage market.
Medicare Shared Savings Program
CMS proposes significant changes to the Medicare Shared Savings Program (MSSP), which aredesigned to accelerate provider and Medicare beneficiary participation in accountable relationships. Last year, CMS established a goal of all Medicare beneficiaries will be in a care relationship with accountability for quality and total cost of care by 2030. These proposals are designed to make further progress on achieving that goal. First, CMS proposes several changes to MSSP which respond to criticisms that the program is not sufficiently flexible to support Medicare providers who may have different levels of sophistication with respect to risk-sharing and available capital for practice transformation. Additionally, it reflects federal officials understanding of the impact social care 杏吧视频 can have on Medicare beneficiary health and well-being.
Proposed changes to the MSSP include the following:
Investment in New Accountable Care Organizations (ACOs): CMS proposes to provide a one-time fixed payment of $250,000 and quarterly payments for the first two years of the 5-year agreement period for certain ACOs. Eligible ACOs are those that are low revenue ACOs, inexperienced with performance-based risk Medicare ACO initiatives, new to MSSP and that serve underserved populations.
The initial application cycle to apply for advance investment payments will occur during CY 2023 for a January 1, 2024, start date.
The advance investment payments would increase when more beneficiaries who are dually eligible for Medicare and Medicaid or who live in areas with high deprivation or both, are assigned to the ACO.
The advance investment payments would be recouped once the ACO begins to achieve shared savings in their current agreement period and in their next agreement period, if a balance persists. If the ACO doesn鈥檛 achieve shared savings, CMS would not recoup the funding.
Funds would be available to address the social and other needs of people with Medicare.
CMS would also provide greater flexibility in the progression to performance-based risk for new ACOs to ease the transition to and likelihood of success under risk arrangements. Specifically, for ACOs with agreement periods beginning on January 1, 2024, and in subsequent years, ACOs inexperienced with performance-based risk could participate a one-side risk model for up to 7 years.
Current ACO Participants: For performance years beginning January 1, 2023, and in subsequent years, CMS may allow certain currently participating ACOs to elect to continue in their glide path agreement.
CMS intends to incorporate an adjustment for prior savings that would apply in the establishment of benchmarks for renewing ACOs and re-entering ACOs
CMS also is proposing several changes to the benchmark methodology to better support long term participation in MSSP and less capitalized ACOs for agreement periods beginning January 1, 2024. 聽This includes adjusting the benchmark for prior savings and reducing the impact of the negative regional adjustment.
CMS also plans to include a fixed, prospectively projected administrative growth factor (referred to in this proposed rule as the Accountable Care Prospective Trend (ACPT)), into a three-way blend with national and regional growth rates to update an ACO鈥檚 historical benchmark for each performance year (PY) in the ACO鈥檚 agreement period.
CMS requested comments on alternative benchmarking policies: a) exclude the ACO鈥檚 own assigned beneficiaries from the assignable beneficiary population used in regional expenditure calculations, b) expand the definition of the ACO regional service area to use a larger geographic area to determine regional FFS expenditures, or c) both.
Beginning on January 1, 2023, and subsequent years, CMS is planning to change the all-or-nothing approach to determining an ACO鈥檚 eligibility for shared savings based on quality performance to allow for scaling of shared savings rates for ACOs that fall below the 30th/40th percentile quality standard threshold required to share in savings at the maximum sharing rate. To be eligible ACOs must meet minimum quality reporting and performance requirements.
CMS also plans to update MSSP quality-measurement policies, including a new health equity adjustment that would award bonus points for high quality measure performance and serving higher proportions of underserved or dually eligible beneficiaries.
Behavioral Health Changes
The CY2023 MPFS also seeks to enhance access to behavioral health 杏吧视频 and strengthen the behavioral health model within the Medicare program. The proposals include:
Creating an exception to supervision requirements, allowing marriage and family therapists, licensed professional counselors, addiction counselors, certified peer recovery specialists, and others to provide behavioral health 杏吧视频 while being under general supervision rather than 鈥渄irect鈥� supervision.
Paying psychologists and social workers to help manage behavioral health needs as part of the primary care team.
Establishing new payments for team-based, comprehensive management and treatment of chronic pain.
Enhancing the ability of ACOs to address social, behavioral, and physical health care needs, by making advanced shared savings payments to new, smaller ACOs. CMS states these funds could be used to hire behavioral health practitioners and address the social needs, such as food and housing.
Clarifying Opioid Treatment Programs may bill Medicare for 杏吧视频 performed by mobile units without obtaining a separate registration and increasing payment rates to Opioid Treatment Programs.
These proposed changes represent a major shift in traditional Medicare鈥檚 coverage of behavioral health 杏吧视频. If finalized and in combination with changes to coverage for telehealth 杏吧视频, these could have a meaningful impact for Medicare beneficiaries including those in rural communities. ACOs, health systems, and other providers may have greater opportunities to include behavioral health practitioners in their model of care.
Payment Issues
Payments to physicians through the PFS are proposed to decline by roughly 4 percent from CY 2022 to CY 2023. The bulk of this decline stems from CMS鈥檚 proposal to reduce the PFS conversion factor (CF) by nearly 4.5 percent. In dollar terms the proposed 2023 CF would be $33.08, which is $1.53 lower than the 2022 CF. This policy change to the CF reflects three dynamics, two of which are changes directly mandated by the U.S. Congress:
Expiration of a statutory one-year 3 percent increase in payments,
A statutory 0 percent payment update for CY 2023, and
A budget neutrality adjustment across all billing codes resulting from modifications to PFS weights which increased the relative value of primary care billing codes.
Payment changes contained within the CY 2023 proposed rule result in differential impacts for individual physician service codes and physician specialties. While payment rates for many codes are proposed to decline uniformly by roughly 4 percent, payment rates for some 杏吧视频 codes may decline more, such as for some physician inpatient hospital care codes that may decline more than 10 percent. In the context of physician specialty type, CMS estimates 5 percent payment increases on average for infectious disease and a 3 percent increases on average for internal medicine and geriatrics. By contrast, CMS estimates a 2 percent decline on average for clinical psychology and a 3 percent decline on average for radiology.
Notable Issues for Stakeholder Consideration
In addition to the major structural and financing issues discussed above, the wide-ranging rule contains numerous other policy proposals with direct and indirect implications on Medicare providers, and beneficiaries, and other stakeholders. Table 1 provides a snapshot of some of the issues that warrant further consideration.
Table 1. Other Notable Proposed Changes Impacting Health Care Providers and Stakeholders
Topic
Summary
Telehealth
The Proposed Rule makes a number of potential changes to telehealth policies: Implements several of the policies mandated by the Consolidated Appropriations Act (CAA) of 2022, which extended telehealth flexibilities CMS adopted during the public health emergency (PHE) for 151 days after the end of the PHE. The rule also confirms Medicare telehealth 杏吧视频 performed with dates of service occurring on or after the 152nd day after the end of the PHE will revert to pre-PHE rules and the appropriate place of service (POS) indicator will be required to be included on the claim.Permanently adds three new 杏吧视频 to the list of reimbursable telehealth 杏吧视频: prolonged inpatient hospital, prolonged skilled nursing, and prolonged home 杏吧视频. Adds several additional 杏吧视频 to the Medicare Telehealth Temporarily (through the end of CY 2023) adds several telehealth 杏吧视频: new therapy 杏吧视频, audiology, and new behavior assessment/treatment 杏吧视频. Temporarily (during PHE plus 151 days) requires practitioners to use billing modifier code 鈥�95鈥� and either provider of service code 鈥�02鈥� (not in home) or 鈥�10鈥� (home) for all telehealth 杏吧视频. At the end of the PHE-plus-151 days, billing requirements will revert to pre-PHE methods. Permanently (beginning in 2023) requires practitioners to use billing modifier 鈥�93鈥� for all audio-only 杏吧视频, and requires RHCs, FQHCs, and OTPs to use modifier 鈥�93鈥� for eligible mental health 杏吧视频 furnished via audio-only 杏吧视频. However, CMS specifically did not propose to extend audio-only evaluation and management visits beyond the 151 days after the PHE.
Dental
Medicare pays for a limited number of dental 杏吧视频 when the dental care is an integral part of a beneficiary鈥檚 medical treatment. CMS is proposing to add to the list of conditions where that may be appropriate such as dental exams and necessary treatments prior to organ transplants, cardiac valve replacements, and valvuloplasty procedures. CMS is also seeking feedback on other clinical conditions where the dental 杏吧视频 are linked to the clinical success of the medical 杏吧视频.
Hearing
CMS is proposing to allow audiologists to perform and bill for certain diagnostic hearing tests for patients with non-acute conditions without a physician order.
Wound Care
CMS is proposing several policies to update payment, coding and billing for skin substitutes which are commonly used in the treatment of diabetic foot ulcers and venous leg ulcers. CMS is proposing to change the terminology of skin substitutes to 鈥榳ound care management products鈥� in order to reflect how clinicians use these products, to provide a more consistent approach to coding for these products, and to treat and pay for these products as a physician supply instead of a separately paid product under the Average Sales Price methodology beginning on January 1, 2024.
MIPS
CMS continues to update and refine the quality measures used in the different aspects of the programs under MIPS including the addition of certain health equity related measures. CMS also is proposing five additional MIPS Value Pathways (MVPs) (Advancing Cancer Care, Optimal Care for Kidney Health, Optimal Care for Patients with Episodic Neurological Conditions, Supportive Care for Neurodegenerative Conditions, and Promoting Wellness) CMS also proposed several ways to reduce the burden for physicians participating in advanced alternative payment models (AAPMs) including permanently establishing the 8% minimally Generally Applicable Risk Standard for AAPM qualification and proposing to apply the eligible clinician limit to the entity participating in the medical home model rather than the parent organization.
The HMA Medicare team will continue to analyze these proposed changes. We have the depth and breadth of expertise to assist with tailored analysis, to model policy impacts, and to support the drafting of comment letters to this rule.
This week, our In Focus section reviews the Indiana Medicaid managed long-term 杏吧视频 and supports (MLTSS) request for proposals, released by the Indiana Department of Administration on behalf of the Family and Social Services Administration on June 30, 2022. Indiana is seeking three managed care organizations (MCOs) that will serve an estimated 106,000 enrollees, beginning January 1, 2024, for a period of four years, with two one-year renewal options.
MLTSS Program
Indiana began forming a plan to reform the state鈥檚 Medicaid LTSS 杏吧视频 in 2019 by holding stakeholder meetings. The state estimated that from 2010 to 2030 the proportion of Hoosiers over age 65 will grow from 13 percent to 20 percent, and that the state鈥檚 system would need to be reformed to meet the growing demand. The state set an objective to shift the LTSS program to a managed care model and to move a higher percentage of new LTSS members into home and community-based settings.
The new statewide, risk-based MLTSS program will serve Medicaid beneficiaries who are aged 60 years and older and are classified as aged, blind, or disabled. These beneficiaries will include individuals who are dually eligible for Medicare and Medicaid, those in a nursing facility, and those who are receiving LTSS in a home or community-based setting.
Beneficiaries in this program will receive all traditional Medicaid 杏吧视频, delivered through a capitated managed care arrangement. Those who meet a specified level of care will be eligible to receive home and community-based 杏吧视频 (HCBS) waiver 杏吧视频. The Medicaid Rehabilitation Option (MRO), Adult Mental Health Habilitation Services Program (AMHH), and Behavioral and Primary Care Coordination (BPHC) will be carved out of the capitated arrangement. For dually eligible beneficiaries, Medicare will be the first payer for all Medicare covered 杏吧视频, including 杏吧视频 that are covered by both Medicare and Medicaid.
Indiana seeks to contract with MCOs that can address complex and chronic health conditions of the program population and integrate care along the continuum and settings of LTSS in the state. Program goals include simplifying access to HCBS and expanding the HCBS provider network, especially in rural areas; using a person-centered approach; improving quality outcomes and consistency of care across the delivery system; promoting caregiver support and skill development; in addition to others.
Timeline
The first part of the proposals is due September 19, with the second part due September 23. Awards are expected in February 2023.
Evaluation
After ensuring proposals meet the mandatory requirement, proposals will be scored out of a total possible 103 points, as shown in the table below.
Preliminary Capitation Rate Summary
Based on the preliminary calendar year 2024 capitation rate development, contracts are estimated to be worth $3.8 billion annually.
This week, our In Focus section reviews the new Center for Medicare and Medicaid Innovation (CMMI) model named the Enhancing Oncology Model (EOM), released on June 27, 2022, by the Centers for Medicare & Medicaid Services (CMS). This new physician specialty model builds off the previously implemented Oncology Care Model (OCM). The EOM incentivizes the coordination of care and the improvement of care quality for Medicare patients undergoing cancer treatment. The model also seeks to reduce Medicare fee-for-service spending for oncology 杏吧视频, because oncology 杏吧视频 are an area of high spending within the Medicare program. As a part of the EOM model participating physician practices will be held accountable for financial and performance targets during six-month episodes of care for systemic chemotherapy administration to patients with common cancer types. The EOM will run for five years beginning on July 1, 2023. Applications to EOM are currently open and will close on September 30, 2022.
CMS indicated that EOM supports President Biden鈥檚 initiative to improve the experience of people and their families living with and surviving cancer. EOM aligns with the Cancer Moonshot pillars and priorities of supporting patients, caregivers, and survivors, learning from all patients, targeting the right treatments for the right patients, and addressing inequities.
Consistent with CMS priorities, EOM also has a strong health equity focus and oncology practices who care for underserved beneficiaries are encouraged to apply.
Design of EOM
EOM is built off the foundation of OCM which ran from July 1, 2016, through June 30, 2022. CMS previously solicited feedback from the oncology community and other interested stakeholders on an OCM successor model. Those lessons plus an alignment with CMMI鈥檚 strategy refresh priorities of moving to total cost of care accountable models and making cancer care more affordable and accessible created the foundations for the design of the model.
Under EOM, participating Physician Group Practices (PGPs) will take on accountability for their patients鈥� health care quality and for total Medicare Parts A and B and certain Part D spending during six-month episodes of care. Eligible Medicare patients are those with certain cancers (breast cancer, chronic leukemia, small intestine/colorectal cancer, lung cancer, lymphoma, multiple myeloma, and prostate cancer) receiving chemotherapy treatment.
Participating practices may bill for a Monthly Enhanced Oncology Services (MEOS) ($70 per month) payment for Enhanced Services provided to eligible beneficiaries. The MEOS payment will be higher ($100 per month) for beneficiaries dually eligible for Medicare and Medicaid.
Enhanced 杏吧视频 are
Provide EOM beneficiaries 24/7 access to an appropriate clinician who has real-time access to the EOM participant鈥檚 medical records.
Provide patient navigation, as appropriate, to EOM beneficiaries
Document a care plan for each EOM beneficiary that contains the 13 components in the Institute of Medicine (IOM) Care Management Plan applicable to the EOM beneficiary
Treat EOM beneficiaries with therapies in a manner consistent with nationally recognized guidelines
Identify EOM beneficiary social needs using a health-related social needs screening tool
Gradual implementation of electronic Patient Reported Outcomes (ePROs)
Participants will be required to take on downside financial risk from the start of the model (with the potential to owe CMS a performance-based recoupment).聽If participants successfully meet quality and savings targets, they will have the opportunity to earn a retrospective performance-based payment (PBP). These amounts will be based on actual practice performance.
CMS has not yet specified the quality measures for this model. Instead, the application says the EOM quality strategy will focus on the following domains: patient experience, avoidable acute care utilization, management of symptoms toxicity, management of psychosocial health, and management of end-of-life care. CMS will prioritize measures that; reflect national priorities for quality improvement and patient-centered care, are outcomes-based measures (including those collected from patients), minimize EOM participant burden where possible, and align with CMS and Innovation Center quality strategy.
Health equity provisions of the EOM include requiring oncology practices to screen for health-related social needs (HRSNs), CMS providing data reports on patient expenditures and utilization for to help health care professionals identify and address health disparities, and CMS increasing reimbursement for the provision of Enhanced Services to patients who are dually eligible for Medicare and Medicaid.
CMS also will issue payment waivers and benefit enhancements to provide additional flexibility to practices in the way they deliver care to patients. Expected enhancements include telehealth, post-discharge enhancements, and care management home visits.
CMS has designed EOM as a multi-payer model. Medicare Advantage plans, state Medicaid plans and other payers are invited to apply to enter into a Memorandum of Understanding with CMS to align on incentives for oncologists to improve care to their patients and increase participation in value-based care arrangements.
What鈥檚 Next
CMS intends to release additional information about EOM payment methodologies later this summer. CMS also will be hosting several upcoming webinars regarding the payment methodology, quality strategy and general application support office hours before the application due date of September 30, 2022. CMS intends to select participants later this year or early next year and will implement the EOM on July 1, 2023.
For more information about this new model and how providers and payers can apply to it, please contact our Medicare experts below. To access the EOM application and other model materials, you may visit .
