CMS issues IPPS/LTCH final rule   08/02/2012
Inpatient hospital payments will increase by 2.3% ($2.5 billion) in fiscal year 2013 under the final rule for the hospital inpatient and long-term care hospital prospective payment systems issued last night by the Centers for Medicare & Medicaid Services. Heeding concerns raised by the AHA and other hospital leaders, CMS withdrew its proposed new cut of 0.8%, or about $850 million, to inpatient PPS payments to permanently eliminate what it claimed was the effect of documentation and coding changes from FY 2010 that do not reflect real changes in case mix. "Although we remain concerned that CMS continues to implement unnecessary coding cuts for changes in 2008 and 2009, we are pleased that CMS changed course on the new 2010 proposal that would have challenged hospitals' mission of caring," said AHA President and CEO Rich Umbdenstock. In addition, the rule outlines parameters around the Hospital Readmissions Reduction Program, set to begin Oct. 1, under which hospitals with higher-than-expected readmission rates will see reductions in their Medicare payments. For the first year of the program, CMS will use three existing 30-day readmission measures for heart attack, heart failure and pneumonia patients. The final rule does not adjust the measures for patient socio-economic factors, as AHA had urged, which may unfairly penalize certain hospitals. AHA members received a Special Bulletin on the rule last night and will receive a detailed analysis in the coming weeks.
LTCHs to receive 1.7% Medicare update, delay in 25% Rule   08/02/2012
Long-term care hospitals will receive a net payment increase of 1.7% in fiscal year 2013 under the final rule for the hospital inpatient and long-term care hospital prospective payment system, released last night by the Centers for Medicare & Medicaid Services. The increase includes a 2.6% market-basket update, which is offset by two payment reductions under the Patient Protection and Affordable Care Act and, for patients discharged on or after Dec. 29, a payment cut for very short-stay outlier cases. The final rule also delays full implementation of the "25% Rule" for one year for cost reports beginning between Oct. 1, 2012 and Oct. 1, 2013. In an improvement to the proposed rule, LTCHs with cost reports beginning between July 1 and Sept. 30, 2012 will no longer have to wait until next year for relief from full implementation of the 25% Rule. "[W]e are pleased that all LTCHs will now benefit from the delayed implementation in the first year," said AHA President and CEO Rich Umbdenstock. The rule also implements a proposed one-time, permanent reduction of 3.75%, which CMS claims would ensure that overpayments in the first year of the LTCH PPS (FY 2003) are not perpetuated. As proposed, the payment cut will be phased in over three years, beginning with a 1.266% cut for discharges occurring on and after Dec. 29, 2012.
Legislation would exclude hospital trustees, employees from SEC rule   08/02/2012
A subcommittee of the House Financial Services Committee yesterday voted 21-10 to approve H.R. 2827, AHA-supported legislation that would exclude hospital trustees and employees from the definition of "municipal advisor" under the Securities Exchange Act. A proposed rule implementing the Dodd-Frank Act would require such municipal advisors to register with the Security and Exchange Commission. "This requirement, and the civil and criminal penalties attached for failure to comply, would act as a powerful deterrent to voluntary service and could result in the loss of many talented and dedicated community leaders," AHA Executive Vice President Rick Pollack said in a letter to Rep. Scott Garrett (R-NJ), chairman of the Subcommittee on Capital Markets and Government Sponsored Enterprises. AHA supports applying the rule to third-party, professional financial advisors to hospitals and bond issuing authorities. But the association believes individuals who serve on hospital governing boards, hospital employees who seek bond financing from state or local authorities, and individuals who serve on the boards of bond issuing authorities should be excluded from the definition of municipal advisor.
Reminder: AHA to host hospital member call on proposed IRS requirements    08/02/2012
AHA will host an Aug. 9 hospital members-only conference call on proposed Treasury Department regulations implementing three of the four new requirements for tax-exempt hospitals under the Patient Protection and Affordable Care Act. AHA staff will be joined on the call by Ruth Madrigal, an attorney advisor and the top Treasury official overseeing the development of the new 501(r) regulations; Ron Schultz, who oversaw development of Schedule H at the Internal Revenue Service as the agency's former Exempt Organizations advisor; and Deborah Ashford, partner at Hogan Lovells LLP. To register for the call, at 2 p.m. Eastern Time, click here. For more information, call AHA Member Relations at (800) 424-4301.
MO liability cap overturned; provider and business groups urge action   08/02/2012
The Missouri Supreme Court this week ruled unconstitutional a 2005 state law setting a $350,000 cap on non-economic damages in medical liability cases. In response, the Missouri Hospital Association today joined a coalition of provider and business organizations in petitioning Missouri Gov. Jay Nixon to begin a dialogue to avoid an exodus of practitioners and insurance carriers from the state. "We can't afford to revisit the chaos that existed in the liability insurance marketplace prior to the 2005 law," said MHA President and CEO Herb Kuhn. "Missouri should experience significant new access to health insurance in 2014 and we will need to have a strong provider community to meet that demand. Now, more than ever, Missouri needs to be focused on strengthening the physician community, not erecting barriers to practice."