AHA Wants Congress To Pressure CMS To Reverse Updates For Inpatient Payment Rule

CMS issues first price transparency fines to 2 Georgia hospitalsSource: Fierce Healthcare, by Robert King

The American Hospital Association (AHA) is turning to lawmakers to pressure the Biden administration to change “woefully inadequate” payment rates proposed for next year.

 

The AHA sent a letter Friday to congressional leaders surrounding the proposed Inpatient Prospective Payment Systems (IPPS) rule, which sets inpatient rates for next year. The hospital lobbying group charged that facilities are facing major challenges not just from the pandemic.

“Historic inflation has extended and heightened the already severe economic instability brought on by the pandemic resulting in razor-thin operating margins from massive surges in input costs, including a struggling workforce, drug costs, supplies and equipment,” the letter said.

 
 

The Centers for Medicare & Medicaid Services (CMS) had proposed a market basket update of 3.2% to Medicare payments for the 2023 federal fiscal year that begins this fall. This was on top of a 2.7% payment update for 2022. The proposed rule released in April calls for a proposed 0.4 percentage point productivity adjustment.

AHA contends that the market basket and productivity update don’t reflect the major inflation jump and growth in expenses.

“More recent data shows the market basket for [fiscal year] 2022 is trending toward 4%, well above the 2.7% CMS actually implemented last year,” the group wrote. “Additionally, the latest data also indicate decreases in productivity, not gains.”

American Hospital Association Urges CMS To Extend Enforcement Discretion For No Surprises Act

CMS urged to extend enforcement discretion for No Surprises Act requirement  | AHA News

Source: Healthcare Finance, by Jeff Lagasse

The American Hospital Association has urged the Centers for Medicare and Medicaid Services to extend enforcement discretion for the No Surprises Act regulatory requirement that healthcare providers exchange certain information to create a good faith estimate for uninsured and self-pay patients – until the agency identifies, and providers can implement, a standard, automated way to exchange the information.

“In the interim final rule implementing this policy, CMS notes that it is exercising enforcement discretion until Jan. 1, 2023, as it may take time for providers and facilities to ‘develop systems and processes for receiving and providing the required information,’” AHA wrote. “We agree that developing and implementing the solution will take time and cannot be achieved efficiently without additional guidance from CMS that identifies a standard technical solution that can be implemented by all providers.”

One of the main concerns from the AHA is that there are currently no methods for unaffiliated providers to share or receive good faith estimates with a convening provider or facility in an automated manner. To share this information, billing systems would need to be able to request and transmit billing rates, discounts and other necessary information for the good faith estimates between providers/facilities.

This is not something that practice management systems can generally do, said the AHA, since billing information is traditionally sent to health insurers and clearinghouses, not other providers.

“Due to the lack of currently available automated solutions, this process would require a significant manual effort by providers, which would undoubtedly result in the convening provider being unable to meet the short statutory timeframes for delivering good faith estimates to the patients and could also lead to inadvertent errors,” the AHA wrote.

AHA requested an extension in enforcement discretion until a technical solution has been found and implemented.

WHAT’S THE IMPACT

Without an automated standard, the AHA said, providers would need to determine individually how to transmit the information. That in turn could lead to variance throughout the industry, especially considering differences in size and technical sophistication among co-providers and facilities. Navigating a non-standardized process, the AHA contended, would increase administrative burden on providers.

To help work toward a standard solution, The AHA said it’s partnering with the American Medical Association, the Medical Group Management Association and HL7 to create a workgroup to discuss potential technical solutions for sharing and receiving critical information among providers. The group will consist of providers and vendors with knowledge of provider systems.

THE LARGER TREND

In December 2021, the American Hospital Association, American Medical Association and other provider organizations sued the Department of Health and Human Services and other federal agencies over implementation of the No Surprise Act. The groups are not against the legislation, they said in the lawsuit filed in federal court but take issue with how HHS implemented a dispute resolution process in the bill.

The No Surprises Act prevented 2 million surprise bills for the commercially insured, according to a survey by AHIP and the Blue Cross Blue Shield Association released in May. The analysis further showed that, if the trend continues, more than 12 million surprise bills would be avoided in 2022.

American Hospital Association Urges CMS To Extend Enforcement Discretion For No Surprises Act

3.2% payment increase is not enough, American Hospital Association says |  Healthcare Finance NewsSource: Healthcare Finance, by Jeff Lagasse

The American Hospital Association has urged the Centers for Medicare and Medicaid Services to extend enforcement discretion for the No Surprises Act regulatory requirement that healthcare providers exchange certain information to create a good faith estimate for uninsured and self-pay patients – until the agency identifies, and providers can implement, a standard, automated way to exchange the information.

“In the interim final rule implementing this policy, CMS notes that it is exercising enforcement discretion until Jan. 1, 2023, as it may take time for providers and facilities to ‘develop systems and processes for receiving and providing the required information,’” AHA wrote. “We agree that developing and implementing the solution will take time and cannot be achieved efficiently without additional guidance from CMS that identifies a standard technical solution that can be implemented by all providers.”

One of the main concerns from the AHA is that there are currently no methods for unaffiliated providers to share or receive good faith estimates with a convening provider or facility in an automated manner. To share this information, billing systems would need to be able to request and transmit billing rates, discounts and other necessary information for the good faith estimates between providers/facilities.

This is not something that practice management systems can generally do, said the AHA, since billing information is traditionally sent to health insurers and clearinghouses, not other providers.

“Due to the lack of currently available automated solutions, this process would require a significant manual effort by providers, which would undoubtedly result in the convening provider being unable to meet the short statutory timeframes for delivering good faith estimates to the patients and could also lead to inadvertent errors,” the AHA wrote.

AHA requested an extension in enforcement discretion until a technical solution has been found and implemented.

WHAT’S THE IMPACT

Without an automated standard, the AHA said, providers would need to determine individually how to transmit the information. That in turn could lead to variance throughout the industry, especially considering differences in size and technical sophistication among co-providers and facilities. Navigating a non-standardized process, the AHA contended, would increase administrative burden on providers.

To help work toward a standard solution, The AHA said it’s partnering with the American Medical Association, the Medical Group Management Association and HL7 to create a workgroup to discuss potential technical solutions for sharing and receiving critical information among providers. The group will consist of providers and vendors with knowledge of provider systems.

THE LARGER TREND

In December 2021, the American Hospital Association, American Medical Association and other provider organizations sued the Department of Health and Human Services and other federal agencies over implementation of the No Surprise Act. The groups are not against the legislation, they said in the lawsuit filed in federal court but take issue with how HHS implemented a dispute resolution process in the bill.

The No Surprises Act prevented 2 million surprise bills for the commercially insured, according to a survey by AHIP and the Blue Cross Blue Shield Association released in May. The analysis further showed that, if the trend continues, more than 12 million surprise bills would be avoided in 2022.

U.S. Hospitals Struggle to Absorb Pandemic-Era Rising Costs

Fitch: COVID-19 resurgence threatens nonprofit hospitals' margins, credit  ratings | Fierce HealthcareSource: Bloomberg, by Carey Goldberg

U.S. hospitals are struggling to absorb rising costs for labor, drugs and supplies as the pandemic drags on, the American Hospital Association said Monday in a report.

Labor costs per patient jumped by 19% in 2021 from 2019, and supplies rose by over 20% per patient during that period, according to the report. Nursing expenses shifted heavily toward travel nurses. The travelers’ share of nursing budgets rose to 39% in 2022 from 5% in 2019.

The federal government has allotted more than $170 billion to help hospitals through the pandemic, but many say they are still losing money, especially after the omicron wave earlier this year. HCA Healthcare Inc. cut its annual adjusted earnings forecast on Friday amid higher labor costs, sending shares 22% lower.

 

“The dramatic rise in costs of labor, drugs, supplies and equipment continue to put enormous pressure on our ability to provide care to our patients and communities,” AHA Chief Executive Officer Rick Pollack said in the statement. The association represents nearly 5,000 hospitals nationwide.

In Massachusetts, the state hospital association on Monday detailed its own financial woes, reporting that in January and February, as omicron hit, hospitals lost $430 million overall, despite federal relief money.

In January, 42 of 47 hospitals surveyed lost money and February was almost as bad, the Massachusetts Health and Hospital Association reported.  Governor Charlie Baker is proposing an additional injection of $250 million in federal money for distressed hospitals.

Last Updated 06/29/2022

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