WASHINGTON WIRE
May 2, 2008
Issue 168
CMS Proposes Cuts to Skilled Nursing Facilities
Genetic Discrimination Bill Heads to President’s Desk
HHS Secretary Medicare Reform Needed in Next Decade
Top Story
CMS Proposes Cuts to Skilled Nursing Facilities
On Thursday, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule to cut payments to skilled nursing facilities (SNFs) by 0.3 percent or $60 million in fiscal year (FY) 2009.
The propose rule included a market basket update of 3.1 percent but also included a proposed cut, requested in the President's FY 2009 budget, of 3.3 percent, resulting in the net decrease in payments. CMS stated that the payment reductions were necessary to offset the unintended payment increases that resulted from the expansion of the Resource Utilization Groups (RUGs).
RUGs are essentially payment categories based on the type and severity of the patients' needs. In 2005, CMS added nine new "groups" to the RUG and forecasted utilization under these groups, assuming budget neutrality. However, as a result of several factors, including a tightening of Medicare rules on inpatient rehabilitation hospital admissions, SNFs saw a significant increase in the influx of patients into the new RUGs.
Although SNF stakeholders blasted the proposed cuts stating that they will negatively impact SNFs' ability to serve high-acuity patients, the agency argues that this payment cut is an attempt to reestablish budget neutrality prospectively.
The proposed rule will be in the May 7 Federal Register and comments are being accepted on the rule until June 30.
Health Care News
Genetic Discrimination Bill Heads to President's Desk
The House approved the Senate's version of the Genetic Information Nondiscrimination Act (H.R. 493) this week, sending the popular bill to the President for his signature.
The legislation aims to prevent discrimination by employers and health insurers based on the result of genetic testing. Supporters of the bill hope HR 493 will help increase genetic research and early screening for genetic conditions and diseases.
While business groups state that they support the intent of the bill, they have expressed concern regarding the financial penalties included in the bill and the lack of leeway the legislation provides for what they consider collection of genetic information for routine business practices.
Although the President has indicated he would sign the legislation, the White House stated for the first time last week that it wanted language included in the bill to allow the military to collect genetic information for the purpose of identifying human remains. The House and Senate quickly passed a resolution on Thursday, amending the bill to meet the President's request.
HHS Secretary: Medicare Reform Needed in Next Decade
Health and Human Services (HHS) Secretary, Michael Leavitt, stated this week that Medicare reform is needed within the next ten years in order to ensure its financial viability. He also stated that such reform will likely have to take place outside the normal political process in order to give Members of Congress the political cover needed to enact controversial changes.
The Secretary stated his support for a trigger-based reform system in which certain indicators would trigger a series of reforms that Congress would not have to support individually. A similar trigger system was enacted as part of the Medicare Modernization Act of 2003 (MMA), however, the MMA trigger does not require that reforms be enacted, only proposed.
Surprised by the lack of attention being given to Medicare reform in the current Presidential race, Secretary Leavitt criticized the Democratic nominees' plans for failing to recognize the impact of expanding the government's role in health care on future generations.
Upcoming Events
Hearings
Monday, May 5, 2008
Medicaid Regulations and Hospital Emergency Surge Capacity
House Oversight and Government Reform Committee
10 a.m., 2154 Rayburn
Tuesday, May 6, 2008
Opportunities in Health Care
Senate Finance Committee
10 a.m., 215 Dirksen
Veterans' Suicides
House Veterans' Affairs Committee
10 a.m., 334 Cannon
Medicare Durable Medical Equipment Competitive Bidding Program
House Ways and Means - Subcommittee on Health
1 p.m., 1100 Longworth
Wednesday, May 7, 2008
Medicaid Regulations and Hospital Emergency Surge Capacity
House Oversight and Government Reform Committee
9:30 a.m., 2154 Rayburn
Veterans' Benefits
Senate Veterans' Affairs Committee
9:30 a.m., 418 Russell
Thursday, May 8, 2008
Cancer and the 21st Century
Senate Health, Education, Labor and Pensions Committee
10 a.m., 106 Dirksen
Use of Psychotropic Medication For Children in Foster Care
House Ways and Means - Subcommittee on Income Security and Family Support
10 a.m., B-318 Rayburn
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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