On January 26, 2015, Health and Human Services (HHS) Secretary Sylvia M. Burwell announced specific goals and a timeline for shifting Medicare reimbursements from the traditional fee-for-service (FFS) model, to a quality or value-based model. This is the first time in Medicare’s history that HHS is setting specific goals for such a shift. Secretary Burwell noted that by moving towards a reimbursement model that rewards quality of care, rather than simply paying for each individual service without evaluating the outcome of such services, that the goals of building a health care system that delivers better care, spends health care dollars more wisely and results in healthier Americans will be realized.
Republican Indiana Gov. Mike Pence announced on Tuesday that an agreement had been reached on the state’s Medicaid expansion proposal submitted in July. As many as 350,000 people could gain coverage under the federal health law after a key concession from the Obama administration was made. The deal could lead to half a dozen more states advancing similar Medicaid expansion proposals in Republican-led states including Florida, North Carolina and Wyoming.
On January 20, 2015, the FDA issued draft guidelines designed to give developers whose products and applications promote healthy lifestyles (so-called “general wellness products”) direction on when such products qualify as medical devices under Section 201(h) of the Food Drug & Cosmetics Act (the “Act”) and are therefore subject to the Act’s regulatory requirements for devices.
On January 5, 2015, Commissioner Dave Jones issued emergency regulations affecting health insurers with respect to access to provider networks in response to consumer complaints that appointments with physicians are hard to obtain, that in-network care is far away, and that in-network provider directories are inaccurate.
The Centers for Medicare & Medicaid Services (CMS) released proposed regulations to clarify and build on current regulatory requirements for Accountable Care Organizations (ACOs) that participate in the Medicare Shared Savings Program (MSSP). Among the changes is one addressing when an ACO must be formed as an independent legal entity, separate from any of its multiple participants. According to CMS, this proposed change is designed to clarify existing regulations and to ensure that ACO decision-making is governed by individuals with fiduciary duties to the ACO alone.
In mid-December, President Obama signed into law a $1.1 trillion spending bill known as the “Consolidated and Further Continuing Appropriations Act, 2015” or “Cromnibus.” This post explores provisions that relate to the health sector and Affordable Care Act (ACA) implementation.
Sheppard Mullin recently prepared an executive summary of a proposed rule issued on December 1, 2014 by the Centers for Medicare and Medicaid Services (“CMS”), at the request of the American Health Lawyers Association. If adopted, the rule would modify the regulatory requirements for Accountable Care Organizations (“ACOs”) that participate in the Medicare Shared Savings Program (“MSSP”) ( 42 CFR Part 425). In the proposed rule, CMS addresses a broad array of issues including data sharing, beneficiary attribution and performance based risk tracks for ACOs. While some of the changes proposed by CMS are merely technical, there are several changes which could have a significant impact on ACOs and their constituent healthcare providers. Some of the more significant changes include: (1) more stringent eligibility requirements for ACO participants, including restrictions on governing bodies and the creation of separate legal entities; (2) modified risk tracks for ACO participants and the creation of a 3rd track involving prospective assignment of beneficiaries; and (3) a broader beneficiary assignment methodology for attribution to ACOs. To learn more, please click here to read the full executive summary prepared by Sheppard Mullin and AHLA on the proposed rule.
A Supreme Court of the United States (SCOTUS) spokesperson announced on December 22, 2014, that the Court will hear oral arguments in King v. Burwell on March 4, 2015. This means that not only could the highest court soon resolve the circuit split on the case’s key issue, but that the future course of the landmark Affordable Care Act (ACA) could be decided as soon as June 2015.
As of earlier this month, 1,170 breaches involving 31 million records have been reported to the Department of Health and Human Services (HHS) since mandated reporting of breaches began in September 2009. An increase in the number of breaches isn’t the only statistic on the rise. Although 2014 data has not yet been released, the number of complaints in 2013 reached a new high (4,463). It doesn’t take a crystal ball to predict that these numbers in 2015 will continue to rise. We haven’t reached the apex yet.
The Terrorism Risk Insurance Act (TRIA) now appears set to expire as of December 31, 2014, barring further action from Congress. The Terrorism Risk Insurance Program Reauthorization Act of 2014 would have extended the existing terrorism insurance coverage under TRIA. Although the House of Representatives previously passed a bill reauthorizing TRIA on December 10, 2014, the Senate failed to pass the measure prior to the end of the 113th Congressional legislative session. The original insurance program was enacted in 2002 (and subsequently extended in 2005 and 2007) after the 9/11 attacks as a backstop to the shortage of terrorism insurance in the private market.