Washington Update - October 2005

In Wake of Hurricane Katrina, CMS Enacts Measures to Help Meet Health Care Needs of Beneficiaries, Providers

To ensure that beneficiaries affected by Hurricane Katrina get needed services, the Centers for Medicare & Medicaid Services (CMS) has relaxed many of its operating procedures. Among other things, CMS emergency relief measures stipulate that:

• Health care professionals who provide medical services, but cannot comply with usual program requirements because of disruptions due to the hurricane, will be paid for these services, unless it is found that fraud or abuse has occurred.
• Emergency services provided to beneficiaries transferred to facilities not certified to participate in the programs will be paid.
• Usual prior authorization and out-of-network requirements for those enrolled in Medicare, Medicaid, or State Children’s Health Insurance Program (SCHIP) managed care plans will be waived.
• Usual licensing requirements for health care professionals who cross state lines to provide emergency care in affected areas will be waived as long as they are licensed in their home states.

For more information about these and other CMS emergency relief measures, including detailed explanations of billing and payment policy changes, and answers to frequently asked questions, visit www.cms.gov.

AGS/AMDA Comment on Proposed Rules on Immunization Standards

The AGS and the American Medical Directors Association (AMDA) submitted joint comments in support of proposed rules issued by CMS that would require long-term care facilities to offer all residents immunizations against influenza and pneumococcal disease. As a new condition of participation in Medicare, CMS proposed on August 11 that long-term care facilities ensure that each resident is:

• Offered influenza immunization annually.
• Immunized against influenza unless medically contraindicated, or the resident or the resident’s legal representative refuses immunization.
• Offered pneumococcal immunization once if there is no history of immunization.
• Immunized against pneumococcal disease unless medically contraindicated, or the resident or the resident’s legal representative refuses immunization.

“As a physician, I know the impact that influenza and pneumococcal infections can have on the elderly, particularly those in nursing homes,” CMS Administrator, Mark McClellan, MD, said. “Greater use of flu shots and pneumococcal vaccine in nursing homes is a proven approach to better health and fewer costly complications for one of our most vulnerable groups of beneficiaries.”

The proposed rule encourages but does not require nursing homes to provide influenza vaccine to their health care workers. In their comments, AGS and AMDA said that long-term care facilities should be required to offer flu shots to all staff, noting that the Joint Commission on Accreditation of Healthcare Organizations is considering a proposal to require that health care workers get flu shots. In addition, the two groups stated, CMS should strengthen the recommendation that staff be educated as to their role in preventing influenza illness in nursing facilities.

A 1999 national nursing home survey showed that 65% of residents had documented influenza shots, and only 38% had been inoculated against bacterial pneumonia, CMS reported in a release. The agency would like to see 90% of nursing home residents inoculated with both vaccinations. As an added incentive to increase immunization rates, CMS increased the average Medicare payment for administering each shot from $8 to $18 in January. That amount is in addition to a separate payment for the cost of the vaccine.

The proposed rule appeared in the August 15 Federal Register. Because of the impending influenza season, this expedited proposed rule had only a 15-day comment period.

CMS and AoA Announce Grants to States to Help Families Find Long-Term Care Services

On August 18, CMS and the Administration on Aging (AoA) announced that 19 states would receive $15 million in grants to establish a single source of information and assistance for families navigating the often confusing array of long-term care services available in their communities.

The Aging and Disability Resource Center (ADRC) grants are part of the New Freedom Initiative, an administration effort to help overcome barriers to community living for the elderly and disabled. They are jointly administered by CMS and the Department of Health and Human Services (DHHS) AoA.

“Resource centers are a tremendous help to families who need to find effective long-term care for a loved one, often with little time to prepare,” said CMS Administrator, Mark McClellan, MD. “These grants will help these states integrate their varied long-term support programs into a single, coordinated system that will make it easier for families to get the most effective care for their loved ones, usually right in their own communities.”

States and territories receiving grants are: Alabama, Arizona, Colorado, District of Columbia, Guam, Hawaii, Idaho, Kansas, Kentucky, Michigan, Mississippi, Nevada, Ohio, Tennessee, Texas, Vermont, Virginia, Washington, and Wyoming. A total of 43 states have received the three-year grants with awards of up to $800,000, CMS reported.

For more information on the ADRC grant program, go to the AoA website at www.acl.gov, the CMS website at www.cms.gov, or the ADRC Technical Assistance Exchange at www.adrc-tae.org.

Medicaid Commission Recommends $11 Billion in Cuts

On September 1, the federal Medi-caid Commission submitted its recommendations for short-term reforms to the program to Congress. Appointed by DHHS Secretary Mike Leavitt in May, the Commission was required to report on ways to achieve $10 billion in savings over the next five years. The fiscal year 2006 congressional budget resolution directs the Senate Finance and House Energy and Commerce Committees to find $10 billion and $14.5 billion, respectively, in savings from programs under their jurisdiction. It is estimated that between $8 and $10 billion would come from the Medicaid program.

The Commission recommends the following:

• Allowing states to establish pharmaceutical prices based on the Average Manufacturer Price (AMP) rather than the published Average Wholesale Price (AWP) (estimated savings: $4.3 billion over 5 years)
• Providing Medicaid managed care health plans access to the existing pharmaceutical manufacturer rebate program currently available to other Medicaid health plans (estimated savings: $2 billion over 5 years)
• Moving the start date of the penalty period to the date of application for Medicaid or the nursing home admission date, whichever is later, for individuals who transfer assets to qualify for Medicaid (estimated savings: $1.4 billion over 5 years)
• Increasing the Medicaid eligibility “look-back” period from 3 years to 5 years (estimated savings: less than $100 million over 5 years)
• Allowing states the flexibility to increase copayments on nonpreferred drugs beyond nominal amounts when a preferred drug is available, to encourage beneficiaries to fill the least costly effective prescription for treatment (estimated savings: $2 billion over 5 years)
• Changing the law so that managed care organizations (MCOs) are treated the same as other classes of health care providers with respect to provider tax uniformity requirements (estimated savings: $1.2 billion over 5 years)

By December 31, 2006, the Commission must make longer-term recommendations on the future of the Medicaid program that ensure its long-term sustainability. These proposals must address the following issues: eligibility, benefits design and delivery; expanding the number of people provided with quality care while recognizing budget constraints; long-term care; quality of care, choice and beneficiary satisfaction; program administration, and other topics that the Secretary may submit to the Commission.

The report is available at https://www.cms.gov.