FEHBlog

Last December, Congress provided doctors, who were facing a 10.6% cut in Medicare reimbursement, with a stay of execution that expires on June 30. The House of Representative’s rules prevented a longer extension. (In fact, Congress gave doctors a 0.5% reimbursement boost for the first six months of 2008).

The Centers for Medicare and Medicaid Services have warned Congress that unless a new extension is enacted by June 16, the wheels implementing the 10.6% cut on July 1 will be set in motion. While both parties want to create an 18 month extension of the status quo, there is disagreement over how to fund it. Therefore, it is likely that the cut will be implemented and then retroactively reversed by Congress. This eventuality, which has occurred a few times in the recent past, causes problems not only for doctors and Medicare payers but also for FEHB plans which pay thousands of claims secondary to Medicare.

The Treasury Department has released here the 2009 indexed amounts on the maximum contribution levels for Health Savings Accounts (HSAs) and out-of-pocket spending limits for High Deductible Health Plans (HDHPs) that must be used in conjunction with HSAs.

• Following up on last Sunday’s post, the Health subcommittee of the House Energy and Commerce Committee will be holding on June 4 at 10 am a business meeting on the discussion draft of the health information technology legislation that a bipartisan group of Committee members has developed.
• Modern Healthcare Online and Government Health IT report no big commercial payer problems associated with the end of the HIPAA National Provider Identifier contingency period on May 23.
• In an interesting development, the State of Connecticut has filed suit in federal court in Boston against McKesson Corp. based on the alleged average wholesale price fixing scheme that is the subject of a private class action in the same court. The private sector class action was brought against McKesson and its alleged co-conspirator First Databank, Inc. (New England Carpenters Health Benefits Fund et al v. First Databank, Inc., et al., Civil Action No. 1:05-cv-11148-PBS. The class plaintiffs counsel and First Databank have proposed a revised settlement to the court after the court reject the first agreement. The class plaintiffs continue to litigate against McKesson. The Connecticut Attorney General sued McKesson, but not First Databank.
• It’s also worth noting that Health Net, a large managed care company, and various class action plaintiffs are proposing a settlement agreement to a federal court in New Jersey where the subject of the dispute is out of network reimbursement levels. Health Net is one of the defendants in the class action filed in Connecticut federal court against Ingenix, the company that develops out of network reimbursement (UCR) schedules, and various managed care companies.

• Kaiser State Health Facts
• AHRQ Medical Expenditure Survey
• AHRQ Healthcare Cost and Utilization Project

What’s more, prescription benefits manager Medco Health Solutions Inc., has released its 2008 Drug Trend Report.

• Good news! The House of Representatives has dropped its plan to statutorily require health plans to cover all mental illnesses identified by the American Psychiatric Association in its Diagnostic and Statistical Manual according to Workforce Management. This compromise with the Senate increases the chances that a stronger mental health parity law will be enacted this year.
• A bi-partisan group of Representatives produced the outline of a House health information technology bill. Meanwhile, the Congressional Budget Office produced a report concludes, according to Government Health IT magazine, that
  

  “there still are many unknowns about the adoption of health information technology, including what its true costs and benefits might be.

  The report, “Evidence on the Costs and Benefits of Health Information Technology,” does not recommend what Congress should do about health IT, but it states that “if policymakers are interested in promoting health IT, some version of a requirement or an explicit or implicit penalty for providers who fail to adopt health IT is likely to be more cost-effective for the federal government than a subsidy.”

• The National Alliance for Health Information Technology forwarded to the American Health Information Community a report including consenus definitions of the following six terms
  

  Electronic Health Record;

  Electronic Medical Record;

  Health Information Exchange;

  Health Information Organization;

  Personal Health Record; and

  Regional Health Information Organization.

• The Federal Trade Commission reported to Congress last week that “Brand name pharmaceutical companies struck 14 deals that led to delayed sale of cheaper generic drugs in the 2007 fiscal year” according to Reuters. The FTC is encouraging Congress to enact a law restricting this practice which the FTC considers to violate antitrust laws.
• On Friday, Medicare began denying electronic claims that included any provide identifying numbers other than the HIPAA National Provider Identifier and the employer or tax identification number. CMS, which enforces HIPAA standards transaction and identifier rules, advised health plan covered entities to similarly terminate their NPI contingency plans.

The internet giant, Google, launched its personal health record site on Monday. As I am a Google subscriber, I bit and signed in. I was presented with terms of service to approve. Here are some interesting tidbits from that agreement:

4. Use of Your Information If you create, transmit, or display health or other information while using Google Health, you may provide only information that you own or have the right to use. When you provide your information through Google Health, you give Google a license to use and distribute it in connection with Google Health and other Google services. However, Google may only use health information you provide as permitted by the Google Health Privacy Policy, your Sharing Authorization, and applicable law. Google is not a “covered entity” under the Health Insurance Portability and Accountability Act of 1996 and the regulations promulgated thereunder (“HIPAA”). As a result, HIPAA does not apply to the transmission of health information by Google to any third party.

plus indemnification of Google, exclusion of warranties, and limitations on Google’s liability.
Needless to say, I did not click any further. The New York Times reports on the launch here.

The President signed the Genetic Information Non-Disclosure Act (GINA, HR 493) into law today. The Johns Hopkins University Genetics Center published a chart showing what the law does and does not cover.

• Modern Healthcare Online published an interesting, wide ranging interview with HHS Secretary Mike Leavitt. Secretary Leavitt discussed the problems created by the “‘silo syndrome.’ Everything is paid for separately. You can’t possibly expect to get any kind of efficiency or coordination, and we have all kinds of bad things that happen as a result, not to mention dramatic amounts of overpayment.” It’s therefore not surprising that the Centers for Medicare and Medicaid Services announced last week “a new demonstration for hospitals to test the use of a bundled payment for both hospital and physician services for a select set of episodes of care to improve the quality of care delivered through Medicare fee-for-service.”

• Government Health IT Magazine reported that following privacy protections crafted by Sen. Patrick Leahy (D Vt) will be added to the Senate’s Wired for Health Care Act:
  

  • Eliminate what Leahy called a loophole in the original bill that would have allowed operators of personal health information databases to give sensitive health records to virtually anyone under the Health Insurance Portability and Accountability Act Privacy Rule.

  • Ban certain health care providers from using or disclosing health records for marketing purposes.

  • Direct the HHS Secretary to submit a report to Congress recommending privacy and security protections for personal health records.

  • Give patients the right to inspect their e-health records and receive electronic copies of the records. Under the HIPAA Privacy Rule, individuals have a right to see their medical records, but there is no clear right to electronic ones.

  • Strengthen congressional oversight over federal health privacy compliance and enforcement of the HIPAA Privacy Rule.

  However, the article also reports that it is unlikely that Congress will pass the bill this year.

• The Federal Times reports on a new FAR Council proposal to expand the proposed contractor code of ethics rule to commercial items and contracts performed in foreign countries. The dollar threshold for application of the rule is $5 million.

• The New York Times reported yesterday on a Centers for Disease Control report on the problems at the Endoscopy Center of Southern Nevada and related clinics that caused 85 hepatitis cases to date.

• Looking forward, Friday May 23 is that date on which Medicare will begin rejecting provider claims that include any provider identifier other than the HIPAA National Provider Identifier and the tax identification number.

• On May 12, Rep. Henry Waxman (D Calif), chairman of the House Oversight and Government Reform Committee, and Rep. Danny Davis (D Ill.), chairman of the Committee’s Federal Workforce Subcommittee, sent letters to OPM Director Linda Springer and Acting CMS Administrator Kerry Weems asking for an explanation of why approximately 200,000 federal annuitants covered by the FEHB Program are enrolled in Medicare Part D and why FEHB plans are not coordinating benefits with Medicare Part D. The representatives requested a reply by Friday May 16.

  It’s my understanding that many of these annuitants are so-called dual eligibles who were automatically enrolled in Medicare Part D because they also are covered under Medicaid. For others, it’s a personal choice. As FEHB plans carriers hold the insurance risk for their plans, they have every reason to coordinate benefits with Medicare.

• HHS’s Office for Civil Rights, which is responsible for the HIPAA Privacy Rule, has created a web page of compliance and enforcement statistics.
• A Medco study concludes that 51% of insured Americans regularly take at least one drug for a chronic health condition according to this AP report.
• Modern Healthcare Online reports that
  

  Average annual medical costs increased by 7.6%, or $1,109, for the typical American family of four from 2007 to 2008, according to the fourth annual Milliman Medical Index. The rate of increase was lower than the previous year—8.4%—and also represented the lowest rate of the past five years, according to the index.