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WASHINGTON WIRE

July 25, 2008
Issue 178

House Committee Passes Health IT Act
Fight to Block SCHIP Directive Hits Obstacles in Senate
GAO Imaging Report Endorses Prior Authorization to Check Growth
OIG Releases Guidance on Retroactive Cost-Sharing Payments
House Blocks Trigger to Decrease Medicare Funds
CMS to Host E-Prescribing Conference in Fall
Hearings

Top Story

HOUSE COMMITTEE PASSES HEALTH IT ACT

Lawmakers continued to work on health information technology legislation this week, but concerns over provider incentives and patient privacy remain.

The House Energy and Commerce Committee passed a Health IT bill Wednesday that would strengthen patient privacy and system security rules and provide $560 million in grants and loans for providers to adopt IT. The Protecting Records, Optimizing Treatment, and Easing Communication Through Healthcare Technology Act of 2008, H.R. 6357, was introduced by Energy and Commerce Chair John Dingell (D-MI) on June 24.

The House Ways and Means Committee, which also has jurisdiction over Health IT, is contemplating a separate version of the bill that will likely include more financial incentives for providers, as well as language to allow patients to sue over privacy breaches. However, Chair Pete Stark (D-CA) told reporters after a subcommittee hearing Thursday that he might not have enough time to address privacy concerns quickly.

The Senate, meanwhile, has its own HIT bill, S. 1693, which has also attracted the attention of privacy advocates. The Wired for Health Care Quality Act was introduced by Senate Committee on Health, Education, Labor and Pensions Chair Edward Kennedy (D-MA) on June 26. With the Chairman's ongoing health issues, it is unclear when the committee or the Senate will consider the legislation.

Health Care News

FIGHT TO BLOCK SCHIP DIRECTIVE HITS OBSTACLES IN SENATE

Attempts to counter a Bush Administration directive aimed at limiting coverage under the State Children's Health Insurance Program have been met with a series of roadblocks this week.

The Senate Finance Committee will be unable to take up a resolution to nullify the controversial SCHIP directive because of an apparent mistake that resulted in a violation of the Congressional Review Act (CRA). On Wednesday (July 23), the committee planned to consider a joint resolution (SJ Res 44) that would nullify the Bush administration's August 17 directive on SCHIP. But on Tuesday the Parliamentarian's office ruled that Senators missed the deadline for filing the resolution and therefore forfeited their authority under the CRA to bring the resolution forward.

It was also expected that Sen. Frank Lautenberg (D-NJ) would offer an amendment condemning the directive during a mark-up of the second economic stimulus package scheduled for today, but Sen. Robert Byrd (D-WV) postponed the mark-up until after the August recess.

We also understand there were plans to attach to the stimulus package a supplemental bill appropriating $5.2 billion to the NIH. The delay in the mark-up also means a delay for the NIH funding vote as well. Sens. Tom Harkin (D-IA) and Arlen Specter (R-PA) introduced the NIH supplemental last week.

GAO IMAGING REPORT ENDORSES PRIOR AUTHORIZATION TO CHECK GROWTH

A new Government Accountability Office report recommends CMS expand the agency's use of front-end approaches to prevent potential overuse of imaging services. Currently, CMS mostly relies on billing safeguards after the service is provided.

The GAO zeroed in on prior authorization, which mandates doctors receive insurer approval before ordering a service, as a front-end mechanism to check the rapid growth in the use of services. GAO found that private health care plans generally contract with radiology benefits managers to provide prior authorization services.

The Medicare bill, on the other hand, mandates the use of appropriateness criteria to help stop overuse of services. The bill requires accreditation for advanced imaging providers.

In the report, GAO found that Medicare spending for imaging services more than doubled between 2000 and 2006, to about $14 billion. The oversight agency found that growth is partly due to the imaging services being provided in physician offices as opposed to hospitals.

OIG RELEASES GUIDANCE ON RETROACTIVE COST-SHARING PAYMENTS

CMS will forgo punishing Medicare providers and suppliers if they decide against collecting fee increases from beneficiaries because of retroactive changes to Medicare payment rates under the new Medicare bill, according to an Office of Inspector General July 23 statement.

Normally, waivers of beneficiary cost-sharing could activate the anti-kickback statute and civil monetary penalty laws. But the OIG says that, in this circumstance, the OIG will not apply sanctions if providers decide to waive the retroactive fees.

CMS has said that beneficiaries could be charged for cost-sharing increases resulting from the retroactive payment increases in the Medicare bill. Those payment increases are retroactive to July 1, the day the short-lived physician payment rate cut was implemented. That payment cut resulted in a significant decrease in cost-sharing rates for patients. The Medicare bill eliminated the cut and increased physician payments, thus increasing cost-sharing rates and raising concerns about patient liability for retroactive hikes.

HOUSE BLOCKS TRIGGER TO DECREASE MEDICARE FUNDS

On Thursday (July 24), the House voted 231-184 to avoid until next year a provision requiring a decrease in Medicare spending after a specific funding trigger is hit. The Medicare Modernization Act requires the cut in spending if Medicare trustees report in two consecutive years that general revenue spending on Medicare will rise above 45 percent. It is unclear if and when the Senate will take up a similar resolution, so the ultimate fate of the trigger is unknown.

CMS TO HOST E-PRESCRIBING CONFERENCE IN FALL

This fall, CMS will host a conference to help physicians transition to electronic prescribing as required by the new Medicare bill. According to the legislation, from 2009 through 2013 CMS will reward practitioners that e-prescribe regularly. By 2012, CMS will also reduce payments to those that fail to e-prescribe, but the bill also allows HHS to create a hardship exception for practitioners unable to e-prescribe.

Upcoming Events

Hearings

Monday, July 28, 2008

Preventing Medicare Fraud
Senate Republican Conference
2 p.m., 385 Russell Bldg.

Thursday, July 31, 2008

Electronic Health Records in Small Specialty Practices
House Small Business Committee
10 a.m., 1359 Longworth Bldg.

Access to Health Care for the Elderly in Rural Areas
Senate Special Aging Committee
10:30 a.m., 106 Dirksen Bldg.

For More Information

For further information on any topics discussed or publications listed, or to get copies of anything mentioned in this alert, please call 202.466.6550 and ask for the Legislative Practice Group.

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