Utah Medicaid Expansion

state-flag-utahUnder the Affordable Care Act, Americans must have health insurance by 2014 or they will be faced with a penalty. The Affordable Care Act, gives each state the option of expanding it’s Medicaid eligibility programs in an effort to offer coverage for more low-income residents.

Utah Gov. Gary Herbert said he will not make a decision to expand Utah’s Medicaid eligibility in an effort to cover more of the states uninsured, until next year. The Governor said he intends to make the decision in conjunction with the legislature and they don’t convene until January 2014.

The Health and Human Services (HHS) department has set no hard deadline for states to make a decision on the Medicaid expansion, but the state risks losing millions in funding if the decision isn’t made by fall. Utah is one of the few states left to decide on the Medicaid expansion. Gov. Herbert said he is still collecting information about the “actual true cost” the expansion will require.

If Utah were to expand it’s Medicaid program, 123,000 of Utah’s 400,000 low-income uninsured residents would  be eligible for coverage. This would expand Medicaid to those residents earning up to 138 percent of the poverty level which is about $32,400 for a family of four, or $15,856 a year for an individual.

For states that opt for the full expansion, the federal government will cover 100% of those costs through 2017. After 2017, states will be required to pay a share of the cost of the expansion, but the law caps those expenses at 10 percent of the overall costs.

Most Utah lawmakers appose the Medicaid expansion, but some medical providers and advocates for the poor favor the expansion.


SGR Repeal & Replace


Parties on Capital Hill continue to make progress by enacting a bi-partisan legislation to repeal and replace the current Sustainable Growth Rate (SGR) formula that is used to update annually, Medicare Physician Fee Schedule payments.

Even though it is earlier in the year but still a very important step, on July 31, the House Energy and Commerce Committee, by a vote of 51 – 0, approved legislation (H.R. 2810) repealing and replacing the SGR formula effective January 1, 2014.

Here is what the legislation is supposed to do:

1. Repeal the current SGR formula, effective for services provided on or after January 1, 2014;

2. Sets a 0.5% increase in the Conversion Factor (CF) for each year for the next 5 years (2014 – 2018).

3. The CF would continue to be permanently updated with 0.5% increases starting in 2019.

4. Also starting 2019, fee schedule payments would also be adjusted by “quality adjusters”

5. “Eligible professionals” would have the option to move from traditional fee-for-service payments using the fee schedule and the conversion factor, to an alternative payment model.

6. CMS will work with physician organizations and other stakeholders to develop the alternative payment models (APMs) beginning 2014.

7. APMs can be approved any time after 2014;

8. A list of approved APMs can be listed on the Federal Register by the Secretary beginning 2015.

9. The legislation anticipates multiple alternative payment models will be developed (presumably specialty specific)

10. Eligible Professional Organizations (peer cohorts) shall develop clinical quality measures applicable to that cohort;

11. The Secretary shall establish a quality adjustment scale based upon the clinical quality measures.  Scores will range from 0 – 100;

12. The quality adjustment score shall have three outcomes: 1% increase, 0% increase or -1% adjustment based upon the providers score on the quality adjustment scale;

13. Each year’s score will only affect payments for that year;

14. New providers payments will be frozen (i.e. score of 0) for one year after entering the program (i.e. no increase or decrease)

15. If a provider opting for the Alternative Payment Model fails to report quality measures, the provider”s payments would be based upon 95% of the fee schedule amount;

16. CMS is directed to coordinate the new initiative with both the PQRS program and the EHR incentive program;

17. If an APM results in higher payments than would have otherwise occurred or if the APM results in lower quality than the Secretary deems appropriate, the Secretary is authorized to immediately terminate the APM;

18. Directs the Secretary of HHS to publish an annual report on how well these new payment models are working.  Reports are also to be produced by GAO and MedPAC.

Unfortunately, the legislation gave no indication as to how it will be “paid for”. The Congressional Budget Office (CBO) said that repealing the SGR formula would “cost” the Medicare Trust Fund approximately $139 Billion over 10 years. The House Leadership also said that whatever formula is put into place, will be “paid for”. Thus meaning there will be offsets.

The House Ways and Means Committee shares jurisdiction over Medicare Part B issues with the Energy and Commerce Committee (E&C). They will now build on the E&C Committees work trying to report out a plan for repealing and replacing the SGR. They will however not be able to make any action until Congress returns to session in September.

Changes to H.R 2810 are not likely at this time, but that could change in the up coming months.

The Ways and Means Committee has sole jurisdiction over all other Medicare programs (Part A, C & D) and handles raising revenue and legislation. That is where we will see how Congress plans to pay for fixing the SGR.

A bi-partisan group of Senators announced they are working on their own version of an SGR repeal and replace bill. The are planning to announce their proposal when Congress returns from recess in September. There are indications that they will have some of the same concepts as H.R. 2810 but could have significant differences in terms of details.

Should the House and Senate pass the SGR repeal and replace legislation these bills will have to be reconciled. President Obama has indicated he supports repealing and replacing the SGR and if the House and Senate reach a solution , the President will sign that legislation into law.

HBMA Testifies on ICD-10

Shaking handsDue to the large role the Healthcare Billing and Management Association (HBMA) plays in revenue cycle management, the HBMA was invited to participate in discussions with the National Committee on Vital and Health Statistics (NCVHS) subcommittee standards on the process of transitioning from ICD-9 to ICD-10 on October 1, 2014.

Holly Louie, CHBME, Chair of HBMA’s ICD-10/5010 Committee presented HBMA’s views on what they considered “lessons learned” from the 5010 conversion that took place in January 2011, and how those lessons could apply to the upcoming ICD-10 conversion.

Louie was one of many experts invited to address the NCVHS. In her address she said, “HBMA believes that we MUST learn from the mistakes that were made in transitioning from 4010 to 5010, and undertake the transition from ICD-9 CM to ICD-10 CM in a way that demonstrates we learned those lessons.” She shared the HBMA’s concerns with the committee and of how those “lessons learned” from 4010 to 5010 should “materially inform the implementation of ICD-10”. She further explained to the committee, “the economic stability of America’s healthcare reimbursement system will be at risk and could be severely compromised, affecting provider financial viability and patients’ access to care.”

The Centers for Medicare and Medicaid Services (CMS) have already delayed the implementation date of ICD-10 to October 1 2014. With this delay Louie said, “it is imperative that the time gained by the delay be used wisely in order to ensure that the transition is successful. If we fail to learn the lessons we will merely be delaying the likelihood for payment disruptions and patient access to care problems from 2013 to 2014.”

HBMA strongly recommends the following:

1. While CMS has adopted a definition of “ready” and developed the tools and checklists to assist every provider, organization, payor and vendor to validate they are ready on October 1, 2014, a subsequent announcement by CMS that they will not perform any external testing is extremely problematic for the industry. End-to-end testing by all payors, to meet the definition of “ready” must occur to ensure a smooth ICD-10 CM implementation. Failure to engage in meaningful end-to-end testing is a recipe for disaster.

2 CMS must establish period benchmarks that cannot be ignored to assess the “readiness” status for all facts of the healthcare industry.

3. There must be clear pronouncement that there is no vendor, EHR, coding assist tool, map, crosswalk or other product that will solve the problem of excellent medical record documentation and accurate coding. Physicians and staff must be fully prepared with adequate training to operate compliantly and not rely on false proclamations of marketed solutions.

4. Payor policies will be critical to the appropriate adjudication of claims. Currently, there is a wide variance among payors in stated policies. It is imperative that policies are published by October 1, 2013 in order to allow adequate time for education and training, data analysis and other preparations for ICD-10 CM.

5. Any payor that is currently only accepting claims by 4010 format must be fully 5010 compliant by January 1, 2014 in order to be ICD-10CM ready.

HBMA’s expert remarks were made on behalf of the membership with the goal of making this transition as smooth as possible for the entire medical community.


SOURCE: Healthcare Billing and Management Association

Website: www.hbma.org