Monday Morning Recap

The HMS Healthcare Management Solutions Monday Morning Recap reviews some of the top stories and healthcare highlights you may have missed last week.

Reinstated Policies Could Backfire

Yesterday, we told you President Obama decided that insurance companies will not be required to upgrade their plans to fit the ACA’s requirements for 2014.  However, it looks like the change could lead to increased premiums; also, Washington and Arkansas, have indicated that they will not allow insurers to reinstate canceled plans.

Insurance companies will now be able to decide if they want to continue to offer the non-complying plans in 2014, but they will need their state’s permission.  In addition, insurers will have certain requirements including notifying customers of the benefits their plans exclude and informing their customers about other options available (such as the options available through the exchange).

Insurers warn that changing the rules may destabilize the market and lead to higher premiums.

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Update: Grace Period on “Two-Midnight” Rule Extended

CMS has extended the grace period on the two midnight rule (see here to read about the rule).  RACs will be able to “scrutinize claims” starting in April, giving hospitals a three month extension of the grace period.  After April 1, there will be RAC reviews for all submitted hospital claims that don’t break the two-midnight threshold.  Any claims that do break the threshold will be considered medically necessary and will not be reviewed.

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November is National Homecare and Hospice Month!

The purpose of this month is to raise public awareness of homecare and hospices. HMS would like to thank the millions of workers in the homecare and hospice industry who work tirelessly to help those in need!

Click here to read more from the NAHC

Study: 17 Million People Eligible for Subsidies

According to a new Kaiser Family Foundation study, 17 million people who are currently uninsured or buy their own health insurance will be eligible for tax credits to help purchase health coverage. More than a third of those eligible reside in either California, Texas or Florida. These three states also have the highest numbers of uninsured residents and the largest amount of people eligible for tax credits.

A different study from the McKinsey Center for U.S. Health System Reform found that six to seven million people may be eligible to use their federal subsidies to cover the entire premium of the lowest priced plan (the bronze plan).  Although bronze plans are the least expensive, they require the most out-of-pocket costs.

The Kaiser Family Foundation study estimates that approximately 29 million people may be able to buy coverage on the exchanges.  The amount of tax credit each person receives depends on certain factors such as their family income.

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Bundled Payments for Dummies: Models 2 & 3

As we continue our bundled payment series (see here and here), focused on a new payment model which combines fee for service reimbursement and capitation, we’d like to introduce you to the second and third bundled payment models.  The following explains each:

Retrospective Acute Care Hospital Stay plus Post-Acute Care:  This model is initiated by a patient admission, either to a participating acute care hospital, or by a participating physician group.  The bundle includes all costs associated with hospitalization as well as all post acute and other related services during that episode of care which can end after 30, 60, or 90 days after a hospital admission.  Participants will be able to choose from 48 different clinical condition bundles.  All providers are paid as usual by CMS but then costs are reconciled with predicted bundle costs retrospectively every quarter.

Retrospective Post-Acute Care Only:  This episode of care will be generated by an acute care hospital stay and will start at initiation of post-acute care services with participating skilled nursing facilities, inpatient rehab facilities, and long-term care hospitals, or home health agencies.  The services in this episode must begin within 30 days of discharge from inpatient stay and would end 30, 60, or 90 days after initiation of the episode.  Participants in this model will be able to choose from 48 different clinical condition bundles.

Stay tuned to learn about the final model and if you need more information on bundled payments, please call us at (203) 294-6659.

HIPAA Violations Can Lead to Prison Time

A Florida nursing assistant in an assisted living center has been sentenced to three years in prison for stealing and selling patient information.  The assistant worked at a 20 bed facility in Clearwater, Florida; this past summer, she pleaded guilty to conspiring to defraud the government and disclosing HIPAA information.  According to reports, she and another man worked together on the scheme until they were caught by undercover police officers who purchased the information.  Interestingly enough, the woman made very little money through the plan and will now spend 37 months in prison.

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Home Health: Rebasing 101

The Patient Protection and Affordable Care Act requires Medicare to reset (rebase) the home health services episode payment rate.  Once rebasing is implemented, rebasing will severely impact home health reimbursement over the next four years.  The new changes will also affect home health quality reporting requirements.  Essentially, CMS is proposing a 3.5% reduction per year for the next four years.

CMS will not be changing therapy payments because adjusting home health PPS factors therapy into the case mix is a complex process that requires more comprehensive analysis and structural changes to the home health PPS system.

With rebasing, CMS predicts that, on average, agencies will see a 1.5% cut in reimbursement this year and an overall reduction in home health payments of $650 million. After updates, the net effect will be a $290 million reduction in payments.  Home health agencies also face the likelihood that it will be at least four years until payment rates rise again.

Below is a list of resources to help you better understand rebasing:

  1. NAHC Whitepaper 
  2. Hall Render Killian Health
  3. Healthcare Association of HI
  4. Visiting Nurse Associations of America

Monday Morning Recap

The HMS Healthcare Management Solutions Monday Morning Recap reviews some of the top stories and healthcare highlights you may have missed last week.

Insurers Send Thousands of Cancellation Letters to Customers

Insurers around the country are sending hundreds of thousands of cancellation letters to consumers who buy their own coverage, forcing some to buy more expensive policies. About 14 million people aren’t offered insurance through their employers, therefore having to buy their own insurance.   Insurers say that many of the policies sold after March 2010 don’t meet the Affordable Care Act’s requirements which start on January 1, 2014.  The new policies that meet the ACA’s requirements, will offer consumers better coverage and 10 “essential” benefits which include prescription drugs, mental health treatment, and maternity care.

The notices have upset some customers who thought they would be able to keep their plans if they liked them.  Florida Blue is canceling 300,000 policies, Kaiser Permanente in California is canceling 160,000 and Independence Blue Cross, the major insurer in Philadelphia, is terminating 45 percent of its plans.

Consumer advocates believe insurers may be doing this to rid their systems of policy holders they no longer want but insurers deny the allegation, stating they expect these policy holders to re-enroll in new plans that may actually offer more coverage.  But, consumers worry that this better coverage may come at a high cost.

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