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House Committee Approves Delay in Medicaid Rules
CMS Publishes Proposed Medicare Inpatient Hospital Rule
House Committee Chairman Introduces FDA Overhaul Legislation
Hearings

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House Committee Approves Delay in Medicaid Rules

Despite a veto threat from the White House, the House Energy and Commerce Committee unanimously approved legislation this week that would delay implementation of several controversial Medicaid regulations for one year. The regulations in question would restrict rehabilitative services, Medicaid graduate medical education (GME) payments, case management, and the use of provider taxes, amongst other cuts.

The Protecting the Medicaid Safety Net Act (HR 5613), introduced by Energy and Commerce Committee Chairman John Dingell (D-MI) and Congressman Murphy (R-PA), received surprisingly strong support from committee Republicans. Ranking Member, Joe Barton (R-TX), has even speculated that the House could override a Presidential veto. A letter confirming a veto threat was sent from the Bush Administration to Members of Congress on Tuesday.

During Wednesday's markup, several Members attempted to address other issues such as pharmacy reimbursement and physician payment relief, but no such amendments were adopted. However, the Chairman stated his intent to hold a full committee meeting in the near future to discuss Members' health-related priorities for the rest of the year.

Ranking Member of the Senate Finance Committee, Charles Grassley (R-IA), made a lengthy statement on the floor this week, indicating that moratoria supporters may face a tougher battle in the Senate. Senator Grassley blasted the House bill and equated efforts to delay the Medicaid regulations to "kicking the can" to next year. He recognized that the Medicaid regulations are not perfect, but stated that Congress should instead focus on fixing the policy behind the regulations.

Advocates argue that moratoria on the regulations would allow stakeholders, including Members of Congress, more time to gain consensus and address each policy.

Health Care News

CMS Publishes Proposed Medicare Inpatient Hospital Rule

The Centers for Medicare and Medicaid Services (CMS) released a proposed rule on Monday that would increase many hospitals' Medicare inpatient payment rates by approximately 2.3 percent or $4 billion in fiscal year (FY) 2009. The proposed regulation started with a "market basket" update of approximately 3.0 percent, but then subtracted 0.9 percent due to assumed hospital billing mistakes and added 0.2 percent for various technical adjustments.

The rule also increases efforts on hospital quality reporting. In FY 2009, hospitals must report data on 30 different quality measures in order to receive the full 2.3 percent update. If a hospital fails to report such data, their inpatient payment rate would drop to only a 0.3 percent increase. CMS goes further in FY 2010 to require that hospitals report on 73 quality measures in order to receive a full update. Again, if a hospital fails to report data in 2010, their update would be reduced. Some hospital groups have stated that this increase in quality reporting requirements is unrealistic.

The rule also addresses the definition of physician-owned hospitals, changing the definition to include a hospital in which a physician and/or immediate family member of a physician owns or has an investment interest. The rule also moves to exclude hospitals that do not have a physician owner/investor or family member referring patients to the hospital from the definition.

The rule will be published in the April 30th Federal Register and comments can be submitted through June 13th. The proposed rule can be found at http://www.cms.hhs.gov/AcuteInpatientPPS/downloads/CMS-1390-P.pdf.

House Committee Chairman Introduces FDA Overhaul Legislation

On Thursday, House Energy and Commerce Committee Chairman John Dingell (D-MI), introduced legislation to make significant food and drug safety changes at the Food and Drug Administration (FDA).

The bill would require food producers to contribute $2,000 annually to fund FDA safety and inspection efforts. A similar system would be set up for drug safety activities and would include inspection of facilities outside the United States. Additionally, the legislation would require that all food and drugs be labeled with the country-of-origin.

The Energy and Commerce Health Subcommittee has scheduled a hearing on the legislation for April 24th. It remains unclear whether there will be any significant action on an FDA overhaul this year, and, given the politics of an election year, some speculate that such action is unlikely.

Upcoming Events

Hearings

Wednesday, April 23, 2008

VA-DOD Cooperation and Collaboration
Senate Veterans' Affairs Committee
9:30 a.m., 418 Russell

Abstinence-Only Programs
House Oversight and Government Reform Committee
10 a.m., 2154 Rayburn

Veterans' Health Bills
House Veterans' Affairs - Subcommittee on Health
2:30 p.m., 334 Cannon

Thursday, April 24, 2008

FDA and Safety
Senate Health, Education, Labor and Pensions Committee
9:30 a.m., 106 Dirksen

Food and Drug Administration Overhaul
House Energy and Commerce - Subcommittee on Health
10 a.m., 2123 Rayburn

For More Information

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