Washington Update: Monday, February 27, 2023

Some LTCHs are now pursuing legislation to extend site-neutral freeze.

With the Congressional season underway, some LTCHs – led by PAM Health and LifeCare -- are asking Congress to extend the freeze on site-neutral payment. The pandemic-era CARES Act of 2020 froze LTCH site-neutral payments but that freeze ends when the public health emergency (PHE) ends. The new legislation has not been endorsed by the American Hospital Association or Select Medical. The bill has no chance of passing but shows a need for a new LTCH policy-consensus.

What is Select Medical’s position on the LTCH site-neutral issue?

This new legislation does nothing to address the LTCH community’s longer-term challenges. Select Medical is encouraging all LTCHs to work with the American Hospital Association to work out a bill that would address bigger issues and could garner the support of the AHA – and Select Medical. Select Medical’s clinicians and operators spent years preparing for LTCH site-neutral payment and did what government regulators preferred: Focusing on high-acuity patients.

MedPAC Commissioner Grabowski says “unified” post-acute is on-hold.

Harvard Professor and MedPAC commissioner David Grabowski was quoted as saying the idea of “unifying” post-acute services into one, new, untested system is on pause for now. For more than ten years, MedPAC has urged Congress to unify post-acute systems which now account for $60 billion in annual spending. Dr. Grabowski said that new payment systems for home health and nursing homes – not to mention the growth of MA -- means that a new system may not be required.

And yet… MedPAC will debate unified PAC-PPS on Thursday.

MedPAC will meet in Washington this week to further debate the unification of post-acute care (PAC). The IMPACT Act of 2014 requires MedPAC to study the issue. In Summer 2022, we put out this statement: “The CMS-RTI report of Summer 2022 confirms what we have been saying: It will be very, very difficult to merge four separate Medicare payment systems into one. We should be careful in rearranging a continuum of care that has been so successful for patients.”

UnitedHealth $5.4 billion acquisition of LHC Group has officially closed.

One year after the deal was first announced, home health provider LHC issued a filing with the SEC to mark the deal's closure. LHC Group will now be folded into UnitedHealth's Optum subsidiary. The deal closed after a lengthy probe from the Federal Trade Commission. United-Health now becomes the second insurer to own a major home health provider. Humana acquired Kindred-at-Home (Gentiva) in 2018. (LHC also operates a dozen LTCHs, mostly in Louisiana).

Humana will focus on Medicare Advantage, leaving the commercial market.

Humana, the nation’s fifth largest insurer, announced it will leave the commercial market and focus on government-run managed care programs, including Medicare Advantage (MA), Medicare Part D, Medicare supplement, Medicaid and TRICARE markets. Humana's employer-sponsored plans had a million policyholders at the end of 2022. Humana CEO Bruce Broussard began his career working for Continental Medical Systems.

Enrollment in Medicare Advantage now reaches 50% of beneficiaries.

For the first time in Medicare’s 58-year history, more beneficiaries are now in managed care (MA) rather than traditional fee-for-service. A new analysis of data by STAT+ says 31.2 million – half the Medicare population– are now in MA. It’s hard to believe but, twenty years ago, MA was only 13% of beneficiaries. Researchers regard this as a big moment in Medicare history, sure to change the way CMS policymakers view the program.

AHA & AMA praise Biden Administration for new MA policies.

Provider groups are applauding CMS' proposed rule overhauling prior authorization in Medicare Advantage. The AMA said the new rules recoginize “a

vital need to rein in Medicare Advantage plans from placing excessive and unnecessary administrative obstacles between patients and evidence-based treatments." The new rules were released by CMS in December. MA plans, on average, deny almost ten percent of prior authorization requests.

CMS extends bundled care demonstration, hoping for more participation.

CMS is extending its voluntary demonstration known as Bundled Payments for Care Improvement Advanced (BPCI-A). Hospitals and systems can apply to serve as “conveners” responsible for managing the total quality and costs of a 90-day period of care for patients in one of 34 clinical episodes, including stroke, major joint replacement and sepsis. CMS launched the demonstration in 2018 to test whether bundling Medicare payments reduces spending and improves quality,

Here we go again: Republican debates start in August in Milwaukee.

The Republican National Committee (RNC) announced that the first presidential primary debate will be held in Milwaukee next August. The RNC has also selected Milwaukee to host the 2024 convention. The Milwaukee engagements reflect the ongoing importance of Wisconsin’s ten electoral votes in the next presidential contest. The only two announced Republicans, as of now, are Donald Trump and Nikki Haley.