CMS Administrator Seema Verma says the rule strikes a balance between federal oversight and state flexibility.
The Centers for Medicare & Medicaid Services on Monday released the 2020 Medicaid and Children's Health Insurance Program Managed Care final rule.
CMS Administrator Seema Verma said the final rule cuts red tape and lowers federal regulatory barriers, which allows state Medicaid and CHIP agencies to customize managed care programs for the 55 million beneficiaries – including 79% of CHIP children in 32 states – who are enrolled in Medicaid managed care programs.
"The era of prescriptive regulations has failed. This rule represents a concerted effort to transform Medicaid to improve quality and access for its beneficiaries," Verma said.
Verma said a working group of stakeholders, including the National Association of Medicaid Directors, helped to craft the final rule, which removes some of provisions in the 2016 final rule that stakeholders had complained were overly prescriptive and burdensome.
"This will remove the burden on states while ensuring appropriate oversight of managed care organizations," she said. "The government should identify expected outcomes, results, and standards – not micromanage processes."
Under the final rule, CMS will provide guidelines for states to complete the federal rate review process, while preserving the requirement for states to implement a Quality Rating System for the managed care plans they contract with, CMS said.
The rule also bolsters efforts to provide access and quality care to rural beneficiaries by changing the minimum standards for network adequacy to support state adoption of telehealth.
Most of the provisions take effect 30 days after the Final Rule is issued Nov. 13.
The rule, mandated under a June 2019 executive order by President Donald Trump, requires private group health plans and individual health insurance market plans to disclose pricing and cost-sharing information in a consumer-friendly format.
The mandate, which takes effect on January 1, 2021, has drawn the ire of payers and providers because of a key provision that health insurance companies must publicly disclose "in real time" the rates they pay providers for specific services.
The American Hospital Association this summer led an unsuccessful effort by providers to ask a federal court to nullify the final rule, arguing, among other things, that the final rule is "arbitrary and capricious," and that the requirement that hospitals publish negotiated rates with insurers violates the First Amendment and oversteps the government's legal authority. The plaintiffs have appealed the ruling.
"The proposal does nothing to help patients understand their out-of-pockets costs," AHA General Counsel Melinda Hatton said at the time. "It also imposes significant burdens on hospitals at a time when resources are stretched thin and need to be devoted to patient care."
Matt Eyles, president and CEO of America's Health Insurance Plans, on Thursday called the final rule "flawed" and predicted it would "reduce competition and push healthcare prices higher – not lower – for American families, patients, and taxpayers."
"This is precisely the opposite of what Americans want in their healthcare," Eyles said. "Competition experts, including the bipartisan Federal Trade Commission, agree that disclosing privately negotiated rates will reduce incentives to offer lower rates, creating a floor – not a ceiling – for the prices that drug makers, providers, and device makers would be willing to accept."
The mandate also requires payers to provide personalized estimates of patients' out-of-pocket cost for 500 of the "most shoppable items and services," along with the costs for the remaining procedures, drugs, durable medical equipment and any other item or service they may need, the Centers for Medicare & Medicaid Services said.
CMS Administrator Seema Verma on Thursday called the final rule "perhaps the most consequential healthcare reform in the last several decades," which "will allow for unprecedented price transparency that will benefit employers, providers, and patients to help drive down healthcare costs."
"Price transparency puts patients in control and supports competition on the basis of cost and quality which can rein in the high cost of care," she said.
Original Medicare and Medicare Advantage beneficiaries will get the vaccine at no cost.
The federal government on Wednesday laid the groundwork for funding and distribution of an eventual coronavirus vaccine that policymakers say will allow providers, states, and payers to "act swiftly" when a treatment becomes available.
The interim final rule released by the Centers for Medicare & Medicaid Services mandates that any vaccine that receives Food and Drug Administration approval will be covered under Medicare as a preventive vaccine at no cost to beneficiaries.
"The rule removes any existing ambiguity surrounding Medicare's coverage to the COVID-19 vaccine," CMS Administrator Seema Verma said Wednesday.
"(This) allows us to focus on the paramount goal of ensuring that all of Medicare 62 million beneficiaries, including those enrolled in a Medicare Advantage plan can receive the vaccine at the provider of their choice again, at no cost."
"And while the federal government is paying for the vaccine, insurers including Medicare, Medicaid and private plans must cover the cost of administering it," Verma said.
"If you're in Medicare Advantage, providers are just going to build a traditional program and essentially beneficiaries can go wherever they want to whatever provider to get their vaccine," Verma said.
Under the final rule, Medicare will pay $28.39 to administer single-dose vaccines, and $16.94, and $28.39 for a vaccine requiring two or more doses. These rates will be adjusted for geography and will take into consideration administrative costs, public outreach, patient education, and reporting requirements.
Verma estimated the cost at about $2.6 billion "if everybody got vaccinated in the Medicare program."
"And obviously, with Medicaid and the private insurance companies, it depends on how much they're going to reimburse for the administration of the vaccines. The federal government is covering the cost of the actual vaccine," she said.
CMS is recommending that state Medicaid programs and commercial payers use the Medicare reimbursement as a benchmark in their vaccine payment plans.
"Using the Medicare strategy as a model would allow states to match federal efforts in successfully administering the full vaccine to the most vulnerable populations," CMS said.
CMS also activated CARES Act provisions that mandate vaccine coverage by most commercial payers with no cost sharing for both in-network and out-of-network providers during the public health emergency.
Therapies
The interim final rule creates additional and automatic Medicare hospital payments for authorized COVID-19 therapies during the public health emergency to mitigate potential losses incurred to make the therapies available, and includes reimbursements for outpatient treatments outside of bundled arrangements and are paid separately.
Verma said the interim final rule on therapies "will eliminate financial disincentives that hospitals may face for furnishing potentially life-saving treatments to America's seniors."
"Traditionally, when a hospital costs for a particular patient exceeds Medicare payments, the hospital can qualify for additional outlier payments, but only after their costs exceed a threshold of about $30,000," Verma said.
"Under this rule, Medicare will pay an additional 65% of the cost for innovative COVID therapies authorized by the FDA provided in an inpatient hospital setting when treatment costs exceed the Medicare payments up to that $30,000 threshold," she said.
If a hospital's costs exceed the threshold, Verma said, they can still qualify for the traditional outlier payments.
"In short, we are bridging the gap between the standard payment and the outlier payments," she said.
Willis Towers Watson finds that while nearly half of employees are deferring medical care, few report suffering worse health outcomes so far.
Workers have embraced telehealth during the coronavirus pandemic and they are giving the virtual care experience high marks, a Willis Tower Watson survey finds.
Almost half of respondents in the survey (47%) have used virtual care services this year — almost three times more than last year (17%), the survey found.
The employees also gave virtual care high marks compared with face-to-face consultations, with 79% reporting virtual care as good, and 25% rating it better. Nearly 80% employees said they would consider using virtual care in the future.
"Virtual care turned out to be just what the doctor ordered during the pandemic," says Julie Stone, WTW's managing director, Health and Benefits.
"Employers were quick to expand and educate employees on how to access virtual care, and employees — especially those who were hesitant to access traditional medical care — took advantage of it," Stone says. "While most employees used virtual care for regular screenings and checkups, a significant number were able to utilize it for diagnosis and treatment of a new illness, chronic conditions and importantly, mental health services."
However, the survey of nearly 5,000 U.S. employees by the Arlington, Virginia-based consultants also found that nearly half of respondents have deferred medical care since the start of the pandemic, primarily over COVID-19 and money concerns.
The 2020 Global Benefits Attitudes Survey also found that:
44% have deferred medical care during the pandemic with 30% either cancelling or postponing a treatment or appointment; 25% said their medical provider has cancelled or postponed a treatment or appointment.
61% said they are worries about COVID-19 for deferring care; 42% cited money concerns.
29% of employees who have deferred care said their health suffered as a result of cancelling an appointment or treatment, while 40% expect their health will suffer.
26% said they will increase their healthcare use when the pandemic ends. 53% with a chronic condition who deferred care expect to significantly increase their use of healthcare services when the pandemic ends.
One in three employees have used virtual care for regular screening and checkups. One in five have used virtual care for mental healthcare or treatment for a new illness.
Virtual care has opened additional pathways for employees to access care, especially for low-income employees, who are more than 40% more likely to say they got the care they needed when using virtual care.
15% reported their physical health had declined due to the pandemic. 22% said their physical health had improved, while 63% indicated no change.
29% said their mental/emotional health had worsened; 53% indicated there was no change, and 18% reported an improvement.
More employees reported improvements than declines in their lifestyle habits (26% versus 23%) and work/life balance (27% versus 21%); however, 42% said their social connections had worsened.
The list of potentially inappropriate medications includes antidepressants, barbiturates, androgens, estrogens, nonsteroidal anti-inflammatory drugs, first-generation antihistamines, and antipsychotics.
One-in-three older Americans is prescribed inappropriate medications and that leads to increased hospitalizations and an additional $458 a year in per-patient healthcare spending, according to new research.
"Although efforts to de-prescribe have increased significantly over the last decade, potentially inappropriate medications continue to be prescribed at a high rate among older adults in the United States," lead investigator David Jacobs, PharmD, PhD, an assistant professor of pharmacy practice in the UB School of Pharmacy and Pharmaceutical Sciences, said in a media release.
The study, published in the Journal of the American Geriatrics Society, used the 2011–2015 Medical Expenditure Panel Survey to examine the prescription of 33 potentially inappropriate medications or classes of medications to adults 65 and older.
The list of potentially inappropriate medications includes antidepressants, barbiturates, androgens, estrogens, nonsteroidal anti-inflammatory drugs, first-generation antihistamines, and antipsychotics.
Of the more than 218 million older adults surveyed, more than 34% were prescribed at least one potentially inappropriate medication, and also spent an additional $458 on healthcare, including an extra $128 on prescription drugs.
On average, those 34% of patients were prescribed twice as many drugs, were nearly twice as likely to be hospitalized or visit the emergency department, and were more likely to visit a primary care physician compared to older adults who were not prescribed potentially inappropriate medication, the study found.
"De-prescribing is currently at an early stage in the United States," Jacobs said. "Further work is needed to implement interventions that target unnecessary and inappropriate medications in older adults."
Marcus Whitney, CEO and co-founder of Nashville-based Health:Further, talks about the winding path that led him to healthcare entrepreneurship and his commitment "to make my life's work about this."
How does one transition from an aspiring hip-hop artist to an established healthcare entrepreneur and investor?
"That's a 20-plus-year story, and I don't think you'll have enough words for that," says Marcus Whitney, CEO and co-founder of Nashville-based Health:Further consulting.
"The simple way to put it is I've been an entrepreneur in Nashville for the last 10 years and, during that time, I entered into the venture capital space and quickly learned that Nashville's superpower was healthcare. And so, in 2015, my partner and I started a healthcare-only early-stage venture fund," he says.
Part of that "20-plus-year story" included two years at the University of Virginia, where Whitney dropped out during his junior year to pursue a career in hip-hop and to wait tables.
"I don't see it as it wasn't a good decision, but it was certainly part of my story, that's for sure," the East Flatbush, Brooklyn native says. After a few years in Atlanta, where Whitney says, "We just didn't quite feel like we had the community around us that we needed," he and his family moved to Nashville.
Nashville prides itself as the Music City, but Whitney quickly learned that healthcare was king. Nashville and its donut counties are home to some of the nation's largest healthcare companies, including HCA Health, Inc., and Community Health Systems, Inc. The city's healthcare sector generates about $92 billion in revenue globally and accounts for about 570,000 jobs.
"Healthcare was the market where we were most likely to be successful as venture capitalists in Nashville," Whitney says. "It has since changed from just that to become an incredible market globally and also a fulfilling market to do work in."
With little experience in healthcare, Whitney knew the learning curve would be steep.
"I had a lot of help. Nashville is a great community and, fortunately, I was relatively well known when we started," he says. "I was able to get access to leaders in the community quickly. You get to skip grades quickly when you're talking to the people who actually run everything, and they can explain to you exactly how things work."
Over the past decade, Whitney says he's come to embrace the healthcare sector "because you can work on it for your entire life; you can pick an area and you can say, 'I'm going to make my life's work about this.' "
"It's going to be meaningful because it touches each one of us, and there's also enough money there to meet your financial needs. It's an amazing industry to be involved in," he says.
Following are highlights from Whitney's conversation with HealthLeaders.
"This is the moment. No one is looking for scared thinking right now. Be bold and think about ways within your locus of control and within your realm of power to effect meaningful change that is going to stick for the next 50 years. The changes we're making right now are going to be multigenerational changes. So, it's a unique window and a unique opportunity."
"The healthcare industry is counterintuitive insofar as it's not a normal economic model. The patient is not the payer. The "aha!" moment for me was understanding the incredible role of CMS and the relationship between CMS and all the commercial payers and how all of that played into the providers. Learning that dynamic is the foundation for everything that you need to know."
"It's critical to have people of color in leadership roles in healthcare, and it's also not happening; not in any way that would be reasonable and measurable. It's important because it's the largest segment of the United States economy, and it also is an essential service that touches every life in America."
"For a person of color, for Black people, that's 18% of the total population of the country, they're all completely affected by it. When you don't have representation, then there's a lack of understanding or lack of perspective. It's not intentional, but there's a lack of empathy for those people. There's also exclusion from the wealth generation that occurs in the lucrative healthcare industry."
"Correcting this will require a lot of work. It starts with commitment from leaders to first acknowledge that such an issue exists. We're still working on that. There hasn't been any meaningful acknowledgment that I can point to from the leaders of the largest healthcare companies in the country to this fact. You have to start with an acknowledgment and once you have an acknowledgment, then you can start the long process."
"We're here to help leaders get inspired about what innovation could do within their organizations and then what their organizations could then do for the communities that they serve. We've done that many times through both our strategic advisory engagements as well as through our conferences over the years. The connections and the inspiration that we were able to create is collectively the success that we're going for."
"Innovation is an understanding that you can always make something better. It starts with the perspective that what we have today can be improved, and then it's the resolve to improve it."
"There are tons of problems in healthcare today. It costs too much and it's inefficient. There are access problems and quality issues, and data rights issues. So, there are opportunities for innovation everywhere."
"The pandemic has exposed a lot of weaknesses in the nation's care delivery."
"We should be honest about the areas where we fell short. We can listen to healthcare workers about where we failed them. We can listen to patient advocates about areas where we should have been more prepared. We can think about re-domesticating our medical manufacturing."
"In five years, I expect to see a lot of changes around technology, telemedicine, and medical manufacturing and stockpiling. We're going to see a lot more competition. There seems to be some important stuff that's going to make its way through CMS right now to change requirements around physician oversight of many reimbursable procedures."
"It's going to be a different looking healthcare system in five years. It was already headed that way with venture capital, private equity, and the digital health revolution, per se and now with COVID-19. That was a real accelerant for change, and it doesn't seem to me that we're going to go back to business as usual."
HHS also is expanding provider eligibility for $20 billion in emergency funding under its Phase 3 distribution of PRF money.
Acknowledging negative feedback from stakeholders, the Department of Health and Human Services announced Thursday that it is revising reporting requirements for $175 billion in pandemic emergency aid under the Provider Relief Fund.
"In response to concerns raised, HHS is amending the reporting instructions to increase flexibility around how providers can apply PRF money toward lost revenues attributable to coronavirus," HHS said.
"After reimbursing healthcare related expenses attributable to coronavirus that were unreimbursed by other sources, providers may use remaining PRF funds to cover any lost revenue, measured as a negative change in year-over-year actual revenue from patient care related sources," HHS said.
HHS revised the rules on September 19 to address concerns that some providers were profiting from the PRF funding while other providers were struggling financially.
Essentially, the revised rules prohibited providers from being more profitable in 2020 than they were in pre-pandemic 2019, so that funding could be given to less-profitable providers.
That revision drew the ire of providers, who urged HHS to allow providers to use PRF payments for all lost revenues.
In a letter this week to HHS Secretary Alex Azar, American Medical Group Association CEO Jerry Pesno said comparing operating income in 2020 and 2019 "would inadvertently deny PRF aid to clinicians and group practices that would otherwise qualify because of an accounting requirement."
"Under the (Sept. 19) proposed formula, when additional providers join a medical group, it may appear that revenue grew for the group," he said. "However, the increase in volume is a result of the new clinicians joining and not due to growth in volume of services delivered."
"COVID-19 continues to decrease patient volume, and in fact, the average revenue per clinician is well below last year's," he said.
The revision also extends by six months – until mid-June 2021 – the allotted time for providers to spend all of their remaining PRF funds for COVID-19 related expenses that are not reimbursed by other sources, or to apply the funds for lost revenues up to an amount not above the difference between 2020 and 2019 actual revenue.
Phase 3 Distribution
HHS on Thursday also announced that it was expanding provider eligibility for $20 billion in emergency funding under its Phase 3 general distribution of PRF money.
"Today, we are expanding the pool of eligible providers to include a broader array of practices, such as residential treatment facilities, chiropractors, and vision care providers that may not have already received payments," Azar said.
Under Phase 3, providers that had already received PRF money may apply for additional funding that considers changes in patient care operating revenue and expenses caused by the coronavirus, HHS said.
Report credits rapid technological advances and improved access and availability for exponential growth.
The global telemedicine market will see an exponential compounded annual growth rate of 23.5% over the next six years, reaching $185.5 billion by 2026, according to an analysis from Fortune Business Insights.
The report credits rapid advances in technology, and the expansion of remote care venues for subspecialities such as cardiology, radiology, and behavioral health with transforming the sector, especially by improving accessibility and availability, both in developed and developing nations.
"This will further give rise to new healthcare business models in telemedicine," the analysis said. "People around the world prefer virtual consultation as it reduces the cost of other healthcare services such as hospital stays."
The projected growth over the next six years marks a five-fold increase from the $34.5 billion global market in 2018, Fortune Business Insights said.
Teleradiology, teledermatology, telepathology, and telepsychiatry services are projected to lead the market over the forecast period, fueled by favorable reimbursement policies. In addition, the entry of new players and the increased adoption of real-time communication are driving the sector, Fortune Business Insights said.
The analysis notes that healthcare providers are increasingly adopting the Picture Archiving and Communication System to securely store and transmit electronic images from anywhere in the world with the help of electronic medical records.
The United States is expected to play a dominant role in the growth of telehealth, thanks to government and commercial payer reimbursement policies, a growing and aging patient pool, and improving practice standards for telehealth and e-health, the analysis said.
"As the aging population is increasing and preference towards telemedicine is rising, the number of e-health visits are increasing exponentially. This will further increase the telemedicine market share in North America," the analysis said.
Editor's note: This story was updated on October 22, 2020.
The settlement does not release from further criminal charges the Sackler family, owners of Purdue, nor any of company's executives or employees.
OxyContin maker Purdue Pharma will pay $8 billion and dissolve as a company in a deal to settle civil and criminal charges for its decade-long leading role in fueling the nation's opioid crisis that has claimed hundreds of thousands of lives, the Department of Justice announced Wednesday.
Under a deal reached with federal prosecutors in New Jersey, and subject to the approval of a bankruptcy court, Purdue will plead to a three-count felony information charging it with one count of dual-object conspiracy to defraud the United States and to violate the Food, Drug, and Cosmetic Act, and two counts of conspiracy to violate the Federal Anti-Kickback Statute, for violations that occurred between 2007 and "at least March, 2017," DOJ said.
"It is important to note that this resolution does not prohibit future criminal or civil penalties against Purdue Pharma's executives or employees," Deputy U.S. Attorney General Jeffrey Rosen said in remarks accompanying the announcement.
The settlement includes a criminal fine of $3.5 billion and $2 billion in criminal forfeiture, and a civil settlement of $2.8 billion to resolve its civil liability under the False Claims Act. Separately, the Sackler family has agreed to pay $225 million in damages to resolve its civil False Claims Act liability, DOJ said.
Federal prosecutors hailed the settlement the largest penalty ever levied against a drug maker. However, the $8 billion forfeiture is dwarfed by the societal costs of the opioid epidemic, which has claimed hundreds of thousands of lives over the past 20 years.
The Centers for Disease Control and Preventionhas estimated that the "economic burden" of opioid epidemic is $78.5 billion a year, which includes the costs of healthcare, lost productivity, addiction treatment, and criminal prosecutions.
"Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts," Steve Miller, who joined Purdue's Board as Chairman in July 2018, said in prepared remarks.
Purdue said new company will emerge from bankruptcy as a "public benefit company, created and operated "for the benefit of claimants and the American people" under a new owner, with new trustees "to provide for free or at cost millions of doses of lifesaving opioid addiction treatment and overdose reversal medicines."
"Resolving the DOJ investigations is an essential step in our bankruptcy process," Miller said. "The settlement agreement will pave the way for Purdue to submit a plan of reorganization to the bankruptcy court that will transfer all of Purdue’s assets to a public benefit company, and ultimately deliver more than $10 billion in value to claimants and communities."
A KFF analysis finds that admissions cratered in March and April but were at 95% of predicted admissions by mid-summer.
Hospital admissions have rebounded somewhat since volumes tanked during the first months of the coronavirus pandemic, but they haven't returned to pre-pandemic levels and likely will be 10% lower than initial projections for 2020, according to an analysis released Monday by the Kaiser Family Foundation.
Using electronic medical record data gleaned from Epic Health Research Network, the KFF researchers looked at total hospital admissions and non-COVID-19 admissions by patient sex, age, and region to calculate the actual admissions as a share of total predicted admissions for 2020 based on past trends.
Researchers say the new data will provide a better understanding of the magnitude of the drop in hospital admissions, its effect on hospitals, insurers and other healthcare stakeholders, and which patients are delaying or foregoing healthcare.
"The data show which areas of the country experienced the steepest declines and where admissions came back to nearly pre-pandemic levels," said study co-author Sam Butler, MD, Epic's vice president of clinical informatics. "In the future, we'll be able to compare this data with patient outcomes to better understand which non-emergency care is most critical."
Among the key findings:
Total hospital admissions dropped to as low as 68% of predicted admissions on April 11, and then increased to a high of 94.3% of predicted levels by July 11, 2020.
As of August 8, admission volume has dropped to 91% of predicted levels.
The number of hospitalizations lost due to admissions drops between March and August represent 6.9% of the total expected admissions for 2020.
With non-COVID-19 admissions, people age 65 and older had half as many admissions in late March and April compared to what was predicted.
Admissions for seniors have stabilized at 80%-85% of their predicted level in early August.
Admissions for people under age 65 were at about 90% of predicted levels during the same seven-month period.
Epic's EMR data ncludes all inpatient hospital admission volume from Dec 31, 2017 to August 8, 2020, for patients who either were discharged or died, as of September 13, 2020.
The data are aggregated weekly and pooled from 27 health systems representing 162 hospitals in 21 states that cover 22 million patients.
The 21 states had 67% of COVID-19 cases as of mid-September and represent 66.5% of the U.S. population.
