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The Autumn Institute A Dual Chapter Event OHA Update. Charles Cataline Vice President, Health Economics and Policy Ohio Hospital Association charlesc@ohanet.org. September 25, 2014. Agenda. Federal Medicare FFY 2015 IPPS Final Rule

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the autumn institute a dual chapter event oha update

The Autumn InstituteA Dual Chapter Event OHA Update

Charles Cataline

Vice President, Health Economics and Policy

Ohio Hospital Association

charlesc@ohanet.org

September 25, 2014

agenda
Agenda
  • Federal
    • Medicare FFY 2015 IPPS Final Rule
    • Medicare CY 2015 OPPS Calls for More Bundling and Packaging
    • Medicare RAC Contract Re-bid Gets Weirder; Where is Medicaid?
    • OHA Working with ODM on Medicare DSH Data
  • State
    • Update on Medicaid/Ohio Exchange Enrollment Targets
    • Medicaid APR-DRG Transition: Year II Yields Unexpected Results; What’s Left?
    • BWC 2015 Hospital Payment Targets
  • Other Finance / PFS
    • 2011 Medicaid DSH Audit is Done, 2012 Kicks in
    • Medicaid Episodic Payment Plan Moving Forward
    • SAFE Program Audits Possible Next Year
    • Hospital Price & Quality Transparency Still an Issue

HFMA Central & NW Ohio Chapters

medicare 2015 ipps
Medicare 2015 IPPS
  • Market Basket Inflationary Update = 2.9%
    • Market Basket Adjustment (ACA) = (0.2%)
    • Productivity Adjustment (ACA) = (0.5%)
    • Documentation and Coding Effect (ATRA) = (0.8%)
    • MS-DRG Budget Neutrality Adjustment = (0.3%)

Total (With no Other Program-Based Adjustments) = 1.1%

  • VBP, Readmissions & HAC Reductions also Applied
  • 2% Sequestration Still in Effect
  • Larger Than Expected Medicare DSH Cuts
  • Increase in Outlier Threshold (From $21,748 to $24,758)
  • Penalty for Providers That Aren’t EHR “Meaningful Users”

Overall (CMS) = Program Expenditures Reduced $756 M

  • Wage Index Revisions Due to Revised Census Tracts
  • Short-stay Payment Policy on Hold (for now!)

HFMA Central & NW Ohio Chapters

medicare 2015 opps proposed
Medicare 2015 OPPS (Proposed)

No Major Changes

  • Proposed MB Rate increase of 2.1 percent
  • Expanded Packaging/Composite APCs
    • 28 Comprehensive APCs for Device-Dependent APCs
    • Conditional Packaging of all Ancillaries With Geometric Mean Cost of $100 or Less
    • Prosthetic Supplies Deemed to be Part of APC
  • Physician Certification Only for Long Inpatient Stays
    • Does not Eliminate Need for Proper Physician Order
  • Services Furnished in Off-campus Provider-Based Departments Must be Identified on Line-Item Basis

HFMA Central & NW Ohio Chapters

medicare rac

Medicare RAC

RAC Contract Rebid Still on Hold

New Regions Drawn to Re-Weigh Claims Volume

Existing Region B Subdivided – at the Very Least Some States in Region B Must Switch Contractors

CMS “Paused” Medicare RAC Activity Until New Contracts are in Place

Feb. 21 – Last Day a RAC can Issue Post-Payment ADR

Feb. 28 – Last Day a MAC can Issue ADR for RAC Pre-Pay Review

June 1 – Last Day a RAC Can Send Denied Claims to MAC for Recovery

BUT… CMS Has Now Reopened Existing Contracts to a Limited (?) Number of (Mostly) Automated Reviews.

No Short-stay Reviews

No Details and/or Effective Dates Out as Yet - Stay Tuned!!

other medicare rac process improvements
Other Medicare RAC Process “Improvements”

In the Interim, CMS Continues to “Refine” RAC Program

  • Medicare RAC Program Administrative Improvements
  • Expanded Services Eligible for Inpatient “Part B” Re-Bills
  • New Offer to Buy Out Outstanding Claims Under Appeal
    • @ 68% of “net paid amount”
    • Not all Providers or Claims Eligible are Eligible
    • Formal Agreement and MAC Review of Claims Required
  • Two-Midnight Rule
  • Proposals for IPPS “Short-Stay” Claims Payment

What’s in it For CMS?

  • Fewer Appeals at ALJ
  • Settle Lawsuits, or at Least Lessen Possibility of Congressional Action

But is it Enough?

HFMA Central & NW Ohio Chapters

cms five medicare rac program improvements
CMS: Five Medicare RAC Program Improvements

HFMA Central & NW Ohio Chapters

what s up with the medicaid rac
What’s Up With The Medicaid RAC?!
  • ODM/CGI Contract Ended in July
  • ODM Assumed Responsibility for Outstanding Reviews, Recoveries and Appeals
    • ODM Will Internally Correct Claims Recovered in Error
    • ODM will Complete any Reviews of ADRs/Medical Records Sent to CGI Before Contract Ended
    • ODM Will Manage Any Requested Appeal CGI did not Complete
      • Interest on New Recoveries Will Only Accrue to Original Overpayment Notification or Appeal Request
    • No Date Released for any of the Above!

HFMA Central & NW Ohio Chapters

state update medicaid expansion
State Update: Medicaid Expansion
  • Background
    • Started Jan 1. 2014
    • Electronic and Expedited Application Software available at “benefits.ohio.gov”
      • Linked to Federal Data Hub
      • No CPJFS Visit Required
      • Utilize MAGI Standards
      • No Documentation Required
    • Presumptive Eligibility Now Statewide
      • 85/85 Quality Standards yet to be enforced
  • OHA “Intake” Tool Kit Available at http://ohiohospitals.org/Policy-Advocacy/Finance-Policy/Medicaid/Medicaid-Enrollment-Toolkit.aspx

HFMA Central & NW Ohio Chapters

medicaid expansion numbers
Medicaid Expansion Numbers

1,117,407 Applied for Medicaid Through benefits.ohio.gov

  • 822,807 (74%) Have Been Resolved
  • 592,390 Individuals Enrolled in Medicaid
  • 230,417 Determined to be Ineligible

Expansion Population Totals

  • 338,707 have enrolled
  • ODM Estimated 175,000 Would Sign up by June 2014
  • Actuaries Estimate 563,000 Ohioans are Newly Eligible, and 366,000 Would Sign up for Coverage by June 2015 (93% of estimate)
    • This Includes 26,000 who Received Medicaid Coverage Through Metro Health Waiver

HFMA Central & NW Ohio Chapters

health insurance marketplace
Health Insurance Marketplace

154,668 Ohioans Have Selected Plans on the Exchange as of May 30. 85% of Them Received Financial Assistance.

HFMA Central & NW Ohio Chapters

medicaid apr drg conversion
Medicaid APR-DRG Conversion

Background

  • Year-Long Process to Determine Relative Weights, Base Rates & Payment Policies
  • OHA Goal: Fairness and Equity Across Hospitals
  • ODM Added Approx. $84 M / Year in FFY 2014 Inpatient Payments for In-state Hospitals
  • Helped Rural Hospitals by Repurposing Funds From Out-of-State Hospitals ($24 M / Year)
  • Has Three-Year Transition with Risk Corridors For Urban Hospitals to Ensure Stability and Minimize Winners & Losers
  • Preserves Most Medicaid IPPS Reimbursement Policies and Payment Logic For Now.

HFMA Central & NW Ohio Chapters

medicaid apr drg conversion1
Medicaid APR-DRG Conversion

IPPS Policy Shifts for SFY 2014 and Beyond

  • CMS Grouper 15 to 3M APR-DRG; New Grouper Starts Each Year with Discharges 10/1 and After
  • Newly Calibrated Relative Weights
  • New Base Rates & Three-Year Transition Includes Stop Loss/Stop Gain Applied to Urban Peer Groups
  • Outliers Policy Changed to Mirror Medicare
  • Medical Education Payments Held Harmless in SFY 2014

But It’s Not Over ‘till It’s Over

  • Stop Loss/Gain Threshold in Out Years of Three-Year Transition Causing Lots of Unforeseen Changes in SFY 2015
  • ODM Proposing Revised SFY 2015 Base Rates for Transition Stop Loss/Gain Hospitals - Effective 10/1/14
  • Additional Discussion Still to Come About Peer Groupings, Next DRG Re-base & Re-Calibration, Medical Education Payments, HAC, Other?

HFMA Central & NW Ohio Chapters

2015 bwc
2015 BWC
  • OHA Recommends BWC Stay With Medicare IPPS/OPPS Methodology
    • Adopt Published Rates in Medicare’s FFY 2015 Proposed Rule; Includes a General Update of 2.1%
    • Eliminate the 1.008% Adjustment Factor to Offset the Medicare Coding and Documentation Adjustment
    • Refine the BWC Payment Adjustment Factors (PAF) to Include Separate Factors Based on Each Hospital’s Medicare Urban or Rural Classification
    • BWC Fee Schedule Analysis Revealed Disparity of Payment-to-Cost Ratio at Major Teaching, Urban, Government & 400-499 Bed Hospital
    • Bottom Line: as Medicare Moves so Does BWC (Down!)

HFMA Central & NW Ohio Chapters

2015 bwc1
2015 BWC
  • BWC Proposing to Refine the Current Payment Adjustment Factors (PAF) at the Urban and Rural Levels
  • OHA Finance Committee to Review and Respond

HFMA Central & NW Ohio Chapters

etc etc
Etc… Etc…
  • 2015 HCAP Moving Add’l $$ to OBRA Pot
  • Medicaid Episodic Payment Plan Gaining Speed
      • OHA Finance Committee Considering Responses
  • SAFE Program Audits Possible Next Year
  • FFY 2011 Medicaid DSH Program (HCAP) Audit Results are Out.
    • Not Too Many Surprises (Except for OB Requirement)
    • FFY 2012 Audit Will Start Later This Month
  • Expect Additional Scrutiny on Hospital Price and Quality Transparency
    • Still Waiting on CMS/HHS Final Rule for

HFMA Central & NW Ohio Chapters

state innovation models episodic payments
State Innovation Models – Episodic Payments

HFMA Central & NW Ohio Chapters

questions comments
Questions / Comments?

HFMA Central & NW Ohio Chapters