8/8/11 CMS published a final rule reducing Medicare skilled nursing facility (SNF) Prospective Payment System (PPS) payments in FY 2012 by $3.87 billion, or 11.1% lower than payments for FY 2011. The FY 2012 rates correct for an unintended increase in payment levels and better align Medicare payments with costs. The FY 2012 recalibration of the case mix index will result in a reduction to SNF payments of $4.47 billion or 12.6%. However, this reduction will be partially offset by the FY 2012 update to Medicare payments to SNFs. The update (an increase of 1.7% or $600 million for FY 2012) reflects a 2.7% increase in the prices of a "market basket" of goods and services reduced by a 1.0% multi-factor productivity (MFP) adjustment mandated by the ACA. The final rule discusses the impact of certain ACA provisions and announces that proposed provisions regarding ownership disclosure requirements set forth in the ACA will be finalized at a later date.

Read the rule at:http://www.gpo.gov/fdsys/pkg/FR-2011-08-08/pdf/2011-19544.pdf

For more information, see www.cms.hhs.gov/center/snf.asp

Prior guidance can be viewed at: www.healthcare.gov

News

8/4/11 HHS/The Center for Consumer Information and Insurance Oversight (CCIIO) denied Guam's request for a waiver which would have allowed insurers in those states to phase in the ACA's medical loss ratio (MLR) requirements, saying the rules in question don't apply to the insurance markets in Guam.
 

The ACA allows the Secretary to adjust the medical loss ratio (MLR) standard for a state if it is determined that meeting the 80% MLR standard may destabilize the individual insurance market. In order to qualify for this adjustment, a state must demonstrate that requiring insurers in its individual market to meet the 80% MLR has a likelihood of destabilizing the individual market and result in fewer choices for consumers. As part of the ACA, if insurers fall short of the standards in 2011, they'll have to issue rebates for that amount in 2012.  

Guam requested an adjustment to the MLR that would allow a gradual transition to the 80% requirement. CCIIO notified Guam that the agency has no authority to grant their request in the group market and that the individual market is so small that insurers don't have to pay rebates. Under the ACA, insurers that don't cover a certain number of people are presumed to be "non-credible" and therefore in compliance with the MLR spending requirements. The two companies that sell individual policies in Guam do not have to pay rebates because they are presumed to meet or exceed the 80% threshold and be compliant.

As of July 22, 2011 HHS had approved waivers for five states including Iowa, Kentucky, Maine, Nevada, and New Hampshire. The other states that have applied include: Delaware, Kansas, Indiana, Louisiana, Georgia, and Florida. In July HHS denied North Dakota's request for a waiver. For more information on states and the MLR requirements visit the CCIIO website at: http://cciio.cms.gov/programs/marketreforms/mlr/index.html

7/29/11 CCIIO issued preliminary decisions about whether states met the external appeals standards established by July 2010 guidance (which contained 16 key elements) or by June 2011 guidance (which contained 13 similar standards). According to federal guidance issued since passage of the ACA, a state external review process must meet new federal requirements or an alternate federal process will apply. Massachusetts' existing state process does not meet all of the 16 original standards, nor does it meet all of the 13 standards. The guidance issued in July 2011 extends the period during which noncompliant state external review processes may operate until January 1, 2012 and gives states that have processes that are similar to the required process until 2014 to bring their processes into full compliance.

When a health plan denies a requested service or supply based on medical necessity, an external appeal process provides a means for an independent review of whether the requested service or supply is medically necessary and therefore a benefit under the health plan. The ACA requires insurers to have in place certain protections that give consumers the ability to more easily file an appeal when their claims are denied.

According to CCIIO, twenty-three states have external review laws that meet the 16 criteria, and another 10 have similar laws in place, giving them until 2014 to tweak their standards. The remaining 17 states (including Massachusetts) and Washington, D.C., don't meet either standard. States have until October 1, 2011 to ask for a redetermination if the state changes its process to comply with the temporary 13 standards. Massachusetts is looking into whether to change our process to meet the federal requirements necessary to continue our state process.

For more information, including CCIIO's preliminary determinations of states' external appeals processes. For more information, visit: CCIIO

EOHHS News

8/1/11 EOHHS submitted comments on the proposed data collection standards for race and ethnicity required by §4302 of the ACA. The comments can be viewed online at the Massachusetts National Health Care Reform website under the State and Federal Communications Section at: MassGov

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