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All health plans, providers and clearinghouses that do business electronically need to adopt a set of national standard electronic transactions by October 2002. Although the regulations went into effect October 16, 2000, plans, providers and clearinghouses have at least two years to implement them. (8/17/00 Federal Register).
These are the first set of regulations implementing the Administrative Simplification provisions of the Health Insurance Portability and Accountability Act (HIPAA). According to the Health Care Financing Administration, this means that a provider can submit the same electronic claim to any health plan in the country, greatly simplifying the process of electronic claims submission for providers. In addition to claims, other transaction standards adopted include those for remittance, eligibility inquiries, claims status, and enrollment.
Providers now should be looking at ways to implement these standards, through software vendors, clearinghouses, or in-house work. ANSI ASC X12N standards, Version 4010, were chosen for all of the transactions except retail pharmacy transactions. Significant information is available at several Web sites, including http://aspe.hhs.gov/admnsimp.
All private sector health plans (including managed care organizations and ERISA plans, but excluding small self administered plans), and government health plans (including Medicare, State Medicaid programs, the Military Health System for active duty and civilian personnel, the Veterans Health Administration, and the Indian Health Service programs), all health care clearinghouses, and any health care providers that choose to submit or receive these transactions electronically are required to use these standards. These covered entities must use the standards when conducting any transaction covered by HIPAA.
Transactions covered by this provision include: Health claims or encounter information; eligibility for a health plan; referral certification and authorization; health claim status; enrollment and disenrollment in a health plan; health care payment and remittance advice; health plan premium payments and coordination of benefits. The code sets adopted as standards for use in the transactions are: ICD-9-CM; CPT-4; HCPCS; CDT-2 (Current Dental Terminology); and NDC (National Drug Codes).
Failure to comply with a standard could lead to penalties of not more than $100 per violation on any one person or entity who fails to comply with a standard. The total monetary penalty on any one person per calendar year may not exceed $25,000 per violation of each requirement.
The HHS Office of Civil Rights issued written policy guidance to assist health and social services providers in ensuring that persons with limited English proficiency (LEP) can access effectively critical health and social services.
Providers who receive federal financial assistance from HHS must assist people with limited English skills to ensure that these patients can access meaningfully the programs and services. The requirements apply to state-administered as well as private and non-profit facilities and program that benefit from HHS assistance. Covered entities include hospitals, nursing homes, HMOs, home health agencies, physicians, etc.
The type of assistance to be provided depends on a variety of factors such as the size of the covered entity, size of the eligible LEP population it serves, nature of the service, resources available and frequency of encounters with LEP population. Small practitioners and providers have considerable flexibility in determining how to fulfill their obligations.
Depending on the need and the circumstances of the individual facility, options for providing oral language assistance range from hiring bilingual staff or hiring on-staff interpreters to contracting for interpreter services as needed, engaging community volunteers, or contracting with a telephone interpreter service.
The written guidance - Prohibition Against National Origin Discrimination as it affects Persons with Limited English Proficiency - is available in the Federal Register or on the Internet at http://www.hhs.gov/ocr.
In an announcement concerning the final compliance guidelines, HHS Inspector General June Gibbs Brown said the guidance provides "great flexibility" in implementation efforts to be conducive with a practice's operations and resources.
The final guidelines attempt to show how compliance can be a regular part of the practice without the expenditure of a significant amount of time or money. The purpose of the guidelines is to help uncover errors and possible patterns that could lead to fraud charges. The guidelines do not suggest that all seven components of a full compliance program be implemented. The OIG uses the seven components to provide a method for developing compliance programs.
The basic steps include: internal monitoring and periodic audits; written standards and procedures; a compliance officer or contacts; training and education; investigation and disclosure; open lines of communication; and disciplinary standards. For the complete set of guidelines, go to: http://www.hhs.gov/progorg/oig.
Just how flexible the final guidelines are remains an open question until physician practices begin to implement the voluntary compliance program.
As this issue of the Texas D.O. goes to press, Texas legislators have been preparing for the opening session of the 77th Texas Legislature since November 13, which was the first day to pre-file bills for the session. The legislature convened on Tuesday, January 9, 2001. It has been estimated that Texas' 31 senators and 150 representatives will consider approximately 5,000 bills during the 140-day regular session, which ends May 28.
TOMA will be monitoring legislation of interest to the profession and will keep the membership informed of any action that may need to be taken on specific bills.
The following are various pre-filed bills of interest. For more detailed information and/or updates, click on www.capitol.state.tx.us.
HB 17 - Rep. Frank J. Corte, Jr. - Relating to the regulation of abortion. Under this legislation, physicians would be required to inform patients seeking abortions of the age of the fetus. In addition, patients would be informed of medical assistance for prenatal care and childbirth; and offered printed material that includes area adoption agencies and color pictures representing the probable anatomical features of the fetus.
HB 26- Rep. Ruth J. McClendon - Relating to the study of barriers to the binational exchange of health information. The Texas Department of Health would be authorized to study state laws inhibiting the exchange of information on disease and epidemiologic reporting between Texas and the United Mexican States, as well as a cross-border exchange of equipment and personnel to provide technical assistance and to enhance the capacity of Texas and the United Mexican States to obtain and exchange this information.
HB 42 - Rep. McClendon - The Texas &M University System would be granted the authority to conduct a feasibility study regarding the creation of a doctor of medicine degree program at Prairie View A&M University.
HB 99 - Rep. Glen Maxey - Relating to the sale and delivery of drugs by electronic media including the Internet. The Texas State Board of Pharmacy would be authorized to adopt rules regarding the sale and delivery of drugs by use of electronic media.
HB 101 - Rep. Maxey - Relating to medical assistance for certain persons in need of treatment for breast or cervical cancer. The Human Resources Code would be amended by adding the provision that the department shall provide medical assistance to a person in need of treatment for breast or cervical cancer who is eligible for that assistance under the federal Breast and Cervical Cancer Prevention and Treatment Act of 2000.
HB 190 - Rep. Lon Burnam - Relating to exclusions and limitations applied under certain health benefit plans. The Insurance Code would be amended by adding "Actuarial support for limitations and exclusions applied in health benefit plans," whereby health benefit plans would not be able to exclude or limit the amount, type or extent of coverage unless the exclusion or limitation is based on sound actuarial principles or reasonably anticipated loss experiences. Such actuarial data or loss experience data must be accurate , reliable, geographically specific, and current at the time of use.
HB 288 - Rep. Maxey - Relating to authorizing harm reduction programs to reduce the risk of HIV infection, AIDS, hepatitis B and hepatitis C. This legislation, in a comprehensive effort to reduce the spread of the aforementioned diseases, would authorize the establishment of harm reduction programs, which would provide: education on the transmission and prevention of such diseases; assistance in obtaining drug treatment and other health related services; materials to promote safe health related practices, including use of bleach and sterile cotton; and free and anonymous exchange of used needles and syringes for an equal number of new needles and syringes. The bill notes,"…it is in the public interest to break the deadly connection between the use of drugs by injection and HIV infection, AIDS, hepatitis B, and hepatitis C by allowing legal access to clean needles and syringes…"
HB 289 - Rep. Maxey - Relating to the advisory committee to the Health and Human Services Commission on telemedical consultation. This bill would establish a Telemedical Consultation Advisory Committee to assist the Health and Human Services Commission in evaluating policies for telemedical consultations; ensuring the appropriate development and use of this technology; and coordinating the activities of state agencies concerned with the use of telemedical consultations in the Medicaid program.
HB 292 - Rep. Maxey - Relating to directing the telecommuications infrastructure fund board to provide for the development and availability of information technologies and telecommunications services necessary for the provision of telemedicine services to rural areas. The board's master plan for infrastructure development must provide for developing and ensuring the availability of such services to rural areas of the state.
SB 11 - Sen. Jane Nelson - Relating to protecting the privacy of medical records and providing penalties for failure to do so. This legislation, called the Medical Privacy Act of 2001 by Sen. Nelson, specifies that patients would have to give permission before any aspect of their medical condition could be sold to telemarketers, pharmaceutical firms or other commercial ventures.
SB 19 - Sen. Nelson - Relating to the improvement of children's health through daily physical activity in public schools, and a coordinated approach by public schools to prevent obesity and certain diseases. Basically, this bill stipulates that school districts require a student enrolled in pre-kindergarten, kindergarten, or a grade level below grade 9 to participate in daily physical activity as part of the district's physical education curriculum.
SB 31 - Sen. Judith Zaffirini - Relating to providing information about bacterial meningitis to students of institutions of higher education. The Texas Higher Education Coordinating Board, after consultation with the Texas Department of Health, would prescribe procedures by which each institution of higher education shall provide information relating to bacterial meningitis to new students of the institution. The information would include symptoms, transmission methods, and the availability and effectiveness of vaccination.
SB 55 - Sen. Zaffirini - Relating to a statewide educational program to prevent infant mortality. The Infant Mortality Prevention Education Program would be implemented by the Texas Department of Protective and Regulatory Services and the Children's Trust Fund of Texas Council.
SB 64 - Sen. Mike Moncrief - Relating to the use of telemedicine in the state Medicaid program. This bill states that the Texas Department of Health, in its rules governing the Early and Periodic Screening, Diagnosis and Treatment Program (EPSDT), shall require a telemedicine medical service for the provision of an EPSDT program service to a child who receives medical assistance under this chapter, if an in-person service with a health care provider is not reasonably available where the child resides or works.
SB 66 - Sen. Moncrief - Relating to the creation and operation of a telemedicine pilot program to provide certain workers' compensation medical benefits. This legislation stipulates that the commission, in cooperation with the Texas State Board of Medical Examiners, shall establish a pilot program in the use of telemedicine medical services within the workers' compensation system, to be provided through regional telemedicine centers.
SB 75 - Sen. Tom Haywood - Relating to the location and operation of the University of North Texas Health Science Center at Fort Worth. This legislation states that the board may establish and operate a facility, program, or campus extension of the University of North Texas Health Science Center at Fort Worth in any county.
SB 97 - Sen. Nelson - Relating to prohibiting certain health benefit plans from requiring the use of hospitalists by participating physicians. This bill states that a preferred provider contract between an insurer and a physician, or a contract between a HMO and a physician, may not require the physician to use a hospitalist for a hospitalized patient.
SB 99 - Sen. Nelson - Relating to an evaluation of preauthorization requirements imposed by managed care organizations providing health care services to recipients of medical assistance. This legislation would require that the Health and Human Services Commission, in cooperation with the Texas Department of Insurance, evaluate the effectiveness of eliminating preauthorization requirements by managed care organizations for routine health care services that are customarily approved. Proposed procedures would be developed for identifying routine health care services for which preauthorization should be eliminated; ensure that health care providers receive notice of health care services for which preauthorization is required; and develop a proposed standard preauthorization form to be used by managed care organizations. A report would be submitted to the legislature no later than November 1, 2002.
SB 104 - Sen. Leticia Van de Putte - Relating to requiring continuing education for teachers in the detection of child abuse and neglect. Teachers would be required to complete at least one hour of training in the detection of child abuse and neglect as part of the requirement for certification renewal.
SB 115 - Sen. Frank Madla - Relating to creating a foundation to finance health programs in the rural areas of the state. The Center for Rural Health Initiatives would be authorized to establish a Rural Health Foundation as a nonprofit corporation, which would operate independently of any state agency. The foundation would raise money from foundations, governmental entities and other sources to finance health programs in the rural areas of the state
SB 126 - Sen. Madla - Relating to the creation and funding of the Rural Communities Health Care Investment Program to attract and retain rural health care professionals. This bill would assist communities in recruiting health professionals to practice in medically underserved communities by providing a loan reimbursement program for health professionals who agree to serve in those communities.
Texas Commissioner of Health William R. Archer III, M.D., resigned October 23, 2000. Archer became Texas health commissioner and chief executive officer of the Texas Department of Health (TDH) in September 1997. Charles E. Bell, M.D., TDH Executive Deputy Commissioner, will handle the duties of the commissioner until a permanent successor to Archer is named.
Under Texas law, a new commissioner of health will be selected by Don Gilbert, Texas Health and Human Services Commissioner, with the concurrence of the board of health and the approval of the governor. A time line for selecting a permanent replacement for Archer has not been finalized as of this writing. (TDH news release, 10-23-2000)
National Heritage Insurance Company has updated its Medicaid claims processing system to monitor the use of group billing numbers and performing provider numbers submitted on the HCFA 1500. Claims submitted with incorrect billing numbers will be denied.
Apparent mismatches between group and individual billing numbers led state officials earlier last year to attempt to recoup $34 million in Medicaid claims paid to physicians and other health care professionals over the past 22 years. The Texas Osteopathic Medical Association was instrumental in persuading them to suspend those efforts.
Under the new system, if the physician performing the service is billing for those services under a group billing number (nine-digit number beginning with Z000), both that number AND the individual physician number (nine-digit number beginning with P08) must be submitted.
Claims submitted with incorrect billing numbers in Blocks 24K and Block 33 will be denied. Claims denied will then need to be corrected and resubmitted to receive correct payment.
IF BILLING AS AN INDIVIDUAL:
* Block 24K: Leave blank or use P08######
* Block 33: P08######
IF BILLING AS PART OF A GROUP:
* Block 24K: P08######
* Block 33: Z000#####
NHIC addressed this issue on page 13 of the July/August 2000 Texas Medicaid Bulletin No. 149.
In an opinion issued November 10, 2000, the Texas Attorney General ("AG") ruled that 5.01(a) nonprofit health corporations seeking certification from the TSBME under the Medical Practice Act must be domestically-organized corporations. The ruling was an affirmation of TSBME's long-standing interpretation of the statute that only Texas nonprofit corporations are eligible for certification. In support of its interpretation, the TSBME argued that because the Texas Non-Profit Corporation Act requires the TSBME to investigate and regulate the internal affairs and structure of a nonprofit health organization, it cannot certify a foreign corporation whose internal affairs and structure are governed by the laws of another jurisdiction. Several foreign nonprofit corporations had argued that the refusal to certify foreign nonprofit corporations was tantamount to a violation of the "Full Faith and Credit" clause of the U.S. Constitution. The AG rejected this argument and ruled that the TSBME's interpretation is controlling since the statutory language can be reasonably read as the TSBME has interpreted it and that such interpretation is in harmony with the rest of the statute. (Vinson & Elkins Health Headlines)
Having lost $6 million this year and unable to find a buyer, the Grand Prairie hospital began transferring its patients to area hospitals in Arlington, Irving, Dallas and Fort Worth after the Dallas-Fort Worth Medical Center's board of directors voted unanimously to close the facility. Officials at John Peter Smith Hospital are considering operating a clinic in an existing space at the medical center. (Fort Worth Star-Telegram, 11-8-2000)
A new telephone hotline response system is now available to private and public clinicians caring for hepatitis patients. The telephone response system is maintained by physicians from the University of Texas Southwestern Medical Center, Comprehensive Center for Liver Research and Treatment in Dallas, Texas. The phone number is 214-648-4801 and is maintained Monday through Friday during normal business hours. (TDH Bureau of HIV and STD Prevention, Texas HIV/STD E-update, 10-2000)
The finding was issued in a report by Karpiel Consulting Group, which also noted that patients spend an average of six hours in JPS's emergency department and an average of nine hours if they require hospital admission. According to the minutes of a September 13 operations meeting of the JPS emergency department, 25 percent of emergency patients are leaving without completing treatment or against medical advice. The hospital's CEO Tony Alcini said that JPS has responded to the findings by adding more hours that ER physicians spend in the department, while the hospital is also reportedly offering additional incentives in an aggressive nurse recruitment effort. (Fort Worth Star-Telegram, 11-8-2000; Dallas Morning News, 11-10-2000)
The Insurance Department is requiring PacifiCare to comply with eleven goals or risk fines, administrative supervision or license removal; and to submit a business plan with budget projections to the Department by December 22, as well as weekly progress reports. Among the goals stipulated by the Department are ensuring prompt and correct provider payments and ensuring that provider networks meet contractual obligations and enrollee needs. (Dallas Morning News, 11-15-2000)
The 70-year-old family practitioner alleged that Humana terminated him from its network for speaking out against Humana's cost-cutting policies to other physicians out of the belief that the policies result in substandard care. Humana plans to appeal the jury decision, maintaining that the de-selection decision by an eight-physician peer review committee was justified. (Corpus Christi Caller-Times, 11-11-2000)
The $385,992 grant is part of a five-year, $15.4 million program to be established at eight academic institutions, and was awarded to UT-Houston School of Public Health in collaboration with The University of North Texas Health Science Center School of Public Health and Texas A&M University Rural School of Public Health. UT-Houston School of Public Health's Associate Dean of Community Health, Hardy Loe Jr., M.D., will be the principal investigator of the Texas multi-center project, while all eight training centers are projected to train 100,000 public health students and practitioners. (Houston Business Journal, 11-13-2000)
The expansion plan, targeted for completion by January 2004 and seeking to tap philanthropic donations and Children's own foundation for funding, will add 132 beds and six floors to the hospital, doubling the number of its intensive care beds to 65, and expand specialty areas including cardiology and neurology. Children's Chief Medical Officer Brett Giroir, M.D., said the hospital has turned away 20 to 30 children a month from its intensive care unit for lack or room. Children's also plans to open outpatient clinics around North Texas in conjunction with Baylor Health Care System and Texas Health Resources and will decide on their number and locations after consulting with physicians and community members. (Dallas Morning News, 11-1-2000)
The 20-bed Acute Care for Elders unit, located at John Sealy Hospital, is open for medical and surgical patients and supervised by UTMB geriatric services personnel, including physicians, physical and occupational therapists, nurse clinicians, a social worker, dietician and pharmacist, with two beds reserved for in-patient hospice care managed by the Hospice Care Team of Galveston. The unit is designed to offer patients a more relaxed, home-like environment with larger patient rooms and space to allow patients to participate in a therapeutic exercise plan that features group recreational activities to mitigate complications such as lost muscle strength, medication side effects and confusion. (Galveston County Daily News, 11-6-2000)
An examination of annual nursing home inspection reports conducted by Democratic staff of the House Committee on Government Reform also found violations that caused actual harm to residents or had the potential to cause death or serious injury at 26 percent of Texas nursing homes. The study was requested by Rep. Ciro D. Rodriguez (D-TX), who attributed substandard nursing home conditions to staff shortages resulting from Medicaid reimbursements that were significantly lower than the national average. (New York Times, 10-31-2000)
The coalition, Tobacco Reduction Using the Settlement in Texas, said the state should increase its anti-smoking program endowment by $150 million and appropriate another $50 million for immediate spending on smoking cessation efforts over the next two years. Texas lawmakers in the 1999 legislative session allocated $200 million of the first $1.8 billion installment of the tobacco settlement to create a permanent endowment to pay for anti-smoking programs, with the rest being allocated to programs such as health insurance for children, medical research and education. (Dallas Morning News, 11-21-2000)
Effective November 1, 2000, the THMP lifted the restriction on access to protease inhibitors (PIs) and non-nucleoside reverse transcriptase inhibitors (NNRTIs) for those clients with Medicaid prescription drug benefits. In order to adhere to funding requirements, the THMP will still remain the payor of last resort, meaning that clients with Medicaid must continue to utilize all three of their monthly Medicaid slots prior to obtaining drugs through the THMP, but their options for accessible formulary drugs will expand to include the PIs invirase, fortovase, ritonavir, indinavir, nelfinavir, and amprenavir, and the NNRTIs nevirapine, delavirdine, and efavirenz.
The restrictions were originally imposed on Medicaid clients as a cost containment measure with the advent of PI/NNRTI combination therapies back in late 1996; it is hoped that removing this prohibition will facilitate an increase in adherence to drug therapies and simplify the process of obtaining drugs for those THMP clients with Medicaid coverage. For more information, call the THMP at (800) 255-1090 or (512) 490-2510. (TDH Bureau of HIV and STD Prevention, Texas HIV/STD E-update, 10-2000)
Cigarroa, 43, is director of pediatric surgery and of abdominal organ transplantation at the health science center in San Antonio and is the first Hispanic to be named as head of a university medical center in the United States. Current UTHSC President John P. Howe III said he expects to step down no later than January 1, while a date for Cigarroa to assume his duties has yet to be determined. (San Antonio Express-News, 10-11-2000)
The Texas Medical Foundation, in conjunction with the Health Care Financing Administration (HCFA), the American Academy of Ophthalmology (AAO), and the American Optometric Association (AOA), have launched a cooperative effort in the state of Texas to increase the rates of dilated eye exams among Medicare beneficiaries with diabetes. The joint initiative seeks to raise public awareness of the connection between diabetes and blindness and to attack barriers such as payment that prevent people with diabetes from getting dilated eye exams.
As physicians are aware, those with diabetes are at an increased risk for eye problems, including blindness, and may need treatment even if their vision is normal. This is why the AAO and the AOA recommend annual dilated eye exams for people with diabetes. Because approximately 10 percent of the Medicare population have diabetes, HCFA has identified diabetes as a clinical priority area where there is a significant opportunity to improve the quality of care provided to Medicare beneficiaries in all states. By law, regular fee-for-service Medicare may not cover eye exams for eyeglasses. Medicare does, however, cover dilated eye exams and this new program makes it easier for patients with diabetes to get regular dilated eye exams.
The campaign is informing Medicare beneficiaries about the Foundation of the American Academy of Ophthalmology's EyeCare America - National Eye Care Project® (NECP), a program that provides eye care for Medicare beneficiaries age 65 and older who have diabetes and have not had a medical eye exam in the last three years. NECP matches qualifying persons with a volunteer ophthalmologist in their area who has agreed to provide a comprehensive medical eye exam and up to one year of follow-up care by that physician for any condition diagnosed at the initial exam, with no out-of-pocket expense to the patient. (Based on guidelines in an Office of Inspector General advisory opinion - OIG AO 99-7.)
Medicare patients with diabetes may also qualify for help in receiving an eye examination by calling AOA's Diabetes Hot Line. This program matches patients with a participating optometrist in their area who has agreed to perform a dilated eye exam and provide or arrange for subsequent care. In cases of financial need, the optometrist may be able to waive the deductible and co-payment a Medical patient usually pays.
TMF began informing Medicare beneficiaries of AAO's and AOA's programs through a series of postcards and brochures sent to qualifying beneficiaries last fall. In addition, a media campaign features radio and television public service announcements reinforced by the direct-mail campaign.
For more information about AAO's NECP, or how to become an ophthalmologist participating in the program, call 1-877-887-6327. For more information about AOA's program, or how to become an optometrist participating in the program, call AOA's information line at 1-800-678-9262 and ask for Kelly Hipp or Cresta Heltemes.
Medicare beneficiaries can call for more information about the AAO's NECP at 1-800-222-EYES (1-800-222-3937) 24 hours a day, seven days a week. AOA's Diabetes Hot Line is 1-800-262-3947, with operators available from 6:00 a.m. - 6:00 p.m. Eastern Standard Time, Monday through Friday.
Under an agreement signed with American Specialty Health Network (ASHN), Cigna is offering its Texas beneficiaries up to a 25 percent discount on services from selected chiropractors, acupuncturists and massage therapists, and up to a 40 percent discount over the Internet on alternative health product purchases. The discounts will be given through 600 ASHN providers in Texas, while 100 other ASHN providers await credentialing. (Houston Business Journal, 11-6-2000)
A new feature on the Texas Department of Health's (TDH's) Web site allows users to retrieve summary birth, death and population statistics for Texas or for any of the state's 254 counties.
The service can be accessed by selecting the "Texas Health Data Queries" option under the "Data & Outcomes" category on the main TDH Web site, www.tdh.state.tx.us. The specific Web address for the service is www.soupfin.tdh.state.tx.us.
The new program is based on a model developed by the Missouri Department of Health. The Texas version has data for 1996, 1997 and 1998. Data for 1999 is expected to be added early this year.
Users can retrieve data for the entire state, multiple counties or a single county. The site also allows the generation of data maps.
PacifiCare said it would continue paying the North Texas IPA's 123 primary care physicians under old contract terms until the end of the year to ensure continuity of care for 4,459 PacifiCare enrollees affected, while PacifiCare tries to contract with individual System Health physicians or with physicians in other groups. System Health said it would be open to future PacifiCare contracts, but rejected PacifiCare's fixed monthly fee arrangement and absence of a contract provision guaranteeing that clean claims would be paid within 30 days. (Dallas Morning News, 11-2-2000)
Alliance, formerly owned by Humana Inc. and with 350,000 local enrollees, will be operated by USC Health Services under the name of Alliance/USC in the Houston and Gulf Coast area. The acquisition brings 30 hospitals and 6,000 physicians to USC, which operates preferred provider networks in Texas and offers PPO networks in 27 other states. (Houston Business Journal, 11-6-2000)
The Texas Higher Education Coordinating Board unanimously approved the deal, which was previously approved by the University of Texas Board of Regents. All that remains to consummate the $30 million acquisition, which was expected by the end of the year and would have Zale Lipshy University Hospital operate St. Paul, is for UT Southwestern to complete a review of legal and environmental issues. (Dallas Morning News, 10-27-2000)
Medicare payment rates to physicians will increase by 4.5 percent overall this year, the Health Care Financing Administration announced on November 1. The figure is the net result of adjustments made under the law to a 5.1 percent update in the final physician fee schedule for calendar year 2001. Rate increases for specific services will vary because of the continuing implementation of a new payment system for physician practice expenses.
The final fee schedule rule was published in the November 1 Federal Register. The physician fee schedule specifies physician payment rates for more than 7,000 services and procedures covered by Medicare. In 2001, Medicare will pay approximately $40 billion for physician services, up from $37 billion in 2000.
The new payment system for physician practice expenses, also required by law, is based on resources involved in providing care, rather than on physicians’ historical charges. Resource-based values for the physicians’ work were implemented several years ago, and HCFA is currently implementing resource-based values for the expenses associated with physicians’ practices. In this, the third year of a four-year phase-in of the new system, 75 percent of physician fees will be based on the new system and 25 percent will be based on physicians’ historical charges. Payments for 2002 will be entirely based on the new system.
The change in payment rates between 2000 and 2001 is the result of the update, transition to the resource-based practice expense payment system, technical changes in the pricing for various services, as well as updated data on malpractice insurance premiums. Payment changes by physician specialty vary mostly as a result of the transition to resource-based practice expense payments. Thus, specialties whose historic charges for practice expenses were less than resource-based rates, primarily office-based physicians such as family practitioners and dermatologists, will have increases greater than 4.5 percent. Cardiac and thoracic surgeons whose historical charges were substantially higher than resource-based rates will experience a small decline in payments. A chart showing estimated aggregate payment changes by specialty is printed below.
Input from physicians enabled HCFA to make several refinements in the final rule:
In addition, for the first time in 2001, physicians will be able to receive separate payment for certifying and recertifying that patients are eligible for Medicare home health services. This change is being made to emphasize the importance of physician involvement in home health services under the new prospective payment system for home health services.
(Combined impact of update, practice expense transition & all other factors)
(Excerpted from HCFA news release, 11-1-2000)
On November 2, HCFA announced a proposed new Medicare payment system for certain special hospitals that care for Medicare beneficiaries recovering from strokes, joint replacements or other conditions requiring rehabilitation.
The prospective payment system required by the Balanced Budget Act of 1997 (BBA) is designed to promote quality and efficient care at approximately 1,100 inpatient rehabilitation facilities, including both freestanding hospitals and special units in acute-care hospitals. Medicare has paid acute-care hospitals under a prospective payment system since 1983. Rehabilitation facilities were exempt from that system. The BBA required HCFA to implement a prospective payment system specifically for rehabilitation facilities.
Under the proposal, rehabilitation facilities would be paid based on the characteristics of each individual patient that they admit. Medicare will pay hospitals more to care for patients with greater needs, as determined by a comprehensive assessment of their condition. The prospective payment system would replace the existing cost-based payment system.
Rehabilitation facilities would be paid on a per-discharge basis just as acute-care hospitals are paid. Medicare prospective payments will cover all the costs of furnishing covered inpatient rehabilitation services - including routine, ancillary and capital costs - except for bad debt and certain other costs, which are paid for separately.
Medicare would pay facilities at relatively higher rates to care for patients with more intensive needs. Payment rates would reflect each patient’s rehabilitation conditions, functional status (both motor and cognitive), age, related illnesses, and other factors that help to explain the intensity of care required by different patients.
Facilities would use a comprehensive assessment tool to assess each patient’s needs and determine the appropriate payment category. These assessments also would allow HCFA and the facilities to monitor and improve the quality of care.
The proposal would adjust payments to rehabilitation facilities when a patient is transferred to another hospital or nursing home before completing the full course of care in order to ensure beneficiaries receive adequate care. A similar policy is in place for acute-care hospitals.
Payment rates for individual facilities would be adjusted to reflect geographic differences in wages and for providing care to a disproportionate number of low-income patients. Rural providers would also receive a payment adjustment to account for their higher costs.
Medicare would make additional payment for "outlier" cases involving beneficiaries with extraordinary care needs.
As the law requires, the new system would establish payment rates so that estimated payments under the PPS are 2 percent less than the estimated payments that would have been paid under the existing cost-based system. This provision will result in estimated savings for Medicare beneficiaries and taxpayers of $1.5 billion over seven years.
HCFA plans to implement the new payment system for rehabilitation hospitals in April 2001. HCFA already has implemented other BBA-mandated prospective payment systems for skilled nursing facilities and outpatient hospital services, and began implementing the home health system on October 1.
The new rehabilitation payment system would be implemented with a two-year transition period. During the transition, facilities would receive blended payment rates that reflect its facility-specific historical costs as well as the new prospective payment rates.
HCFA was to publish a proposed rule describing the new payment system in the November 3 Federal Register, with a 60-day public comment period. After evaluating the comments and making appropriate changes to the proposal, a final rule will be published. (Excerpted from HCFA news release, 11-2-2000)
On October 18, the Department of Health and Human Services announced the 2001 rates for the Medicare Part A deductible and Part B monthly premium amounts paid by beneficiaries.
The Part A deductible for inpatient hospital care will rise by $16, to $792. The Part A deductible is a beneficiary’s only cost for up to 60 days of Medicare-covered inpatient hospital care. The daily cost to beneficiaries for hospital days 61 through 90 in a benefit period is rising by $4, to $198 per day; and by $8, to $396 per day for hospital days beyond the 90th in a benefit period. The skilled nursing facility daily coinsurance amount, which must be paid after the first 20 days of such care in a benefit period, is rising by $2, to $99 per day.
The Part A premium, paid by a small percentage of beneficiaries, is decreasing again in 2001. For the 388,000 beneficiaries who pay a premium for Medicare Part A coverage, premiums will decrease by $1, to $300. (Excerpted from HHS news release, 10-18-2000)
