State and Federal
Health Care
Legislation
Lawrence Massa
Minnesota Hospital Association
May 17, 2012
The good news continues ….
Well … not so fast …
State Health Care
Legislation
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State Issues:
Community benefit
 Passed repeal legislation keeping hospitals’
community benefit activities locally determined.
• Unanimous support in House and Senate
• Repeal of new rider language from 2011
• Funding language for Statewide Health Improvement
Project (SHIP) remains
State Issues:
Provider Peer Grouping
 Passed a Provider Peer Grouping “fix-up”
language in same bill as community benefit.
• Allows providers to verify their data
• Requires better risk adjustment for high cost services
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like trauma, medical education and neo-natal ICU
Creates a stakeholder/expert advisory committee
Expands scope of appeals (peer group, calculations,
methodology and data)
Requires use of most current data available
Eliminates requirement that health plans use PPG in
product design
State Issues:
HHS Omnibus Bill
 Allow Medicaid coverage for inpatient mental health
services delivered by a physician assistant acting
under psychiatrist’s supervision
 Further restriction on release of medical records
• Expands liability for unauthorized, intentional access via
record locator service
• Requires study by Department of Health to examine
capability of detecting unauthorized attempts to view a
patient’s medical records
 Establishes a 10-day window for DHS prior
authorization for PT/OT, speech, audiology and
mental health services, otherwise authorized
State Issues:
HHS Omnibus Bill
 Restores Emergency Medical Assistance
coverage for dialysis and cancer treatments
 Repeals Minn. Rule that required physician
authentication (signature) of verbal/emergency
orders within 24 hours
State Issues:
Radiation Therapy
 The current moratorium in 14 counties stays in
place until 2014
 After 2014, can’t build a new radiation facility
within 7 miles from a current facility
 Maintained the requirement that any new
radiation facility must be built in collaboration
with a hospital
State Issues:
Miscellaneous
 Enacted a new felony-level offense for intentional
deprivation of a vulnerable adult.
• Provides affirmative defenses for caregivers acting in good
faith
 Amended MN’s No-Fault Auto Insurance statute.
• Restricts the use of “runners and cappers” which can
generate inappropriate health care services.
• $20,000 in medical coverage remains in place.
 Newborn screening bill responds to court ruling
• Opt-out for testing
• Opt-in for allowing MDH to store sample for 18 years
Other policy issues raised
but not enacted
 Interstate Nurse Licensure Compact
 Partial restoration of Medical Education Research
Costs (MERC)
 Health Insurance Exchange
 1-year restoration of 5% cut to outpatient
provider rates
 Leapfrog mandate
Other policy issues raised
but not enacted
 Mandatory nurse-to-patient staffing ratios
• Bills introduced (SF 2182; HF 2618)
• MHA successful at keeping bills from getting hearings
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in either House or Senate
Major, contentious issue for 2012 elections and 2013
session
o MN hospitals already provide safest, highest quality care in
the country
o Mandated ratios not shown to improve care safety or quality
o Hospitals need flexibility to staff for patient acuity and
caregivers’ experience/skill level
o Mandated ratios increase the cost of care significantly
Attorney General
Agreement
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Current Requirements:
Based on 2005 agreement &2007 extension
 Cap on charges to uninsured
• Uninsured pay amount equal to what hospital’s “Most
Favored Insurer” pays
 Adopt charity care and debt collection policies
 Limit debt collection litigation (and litigation-like)
• Limit on garnishment, contingency fees, credit bureau
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reports
Requires senior corporate officer review at each step
of litigation process
Modifications
in new extension
 5-year extension
 Modify Attorney General contact information on
hospital collection notices so patients contact
hospital first, then AG if issue is unresolved
 Clarify that hospitals may respond to patient
inquiries verbally, not just in writing
Federal Issues
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Federal budget not getting
any prettier
 Rep. Paul Ryan budget proposal
• Shift Medicare to voucher program
• Shift Medicaid to block grant
 Debt ceiling deal from 2011
called for 2% across-the-board cuts
• Goes into effect Jan. 1, 2013
• Includes Medicare and critical access hospitals
• Will not apply to Medicaid
 President Obama proposed additional hospital
and provider cuts
Critical Access Hospitals
no longer “under the radar”
 President proposed cutting payments 1%
 President proposed eliminating CAH status for
hospitals within ten miles of another hospital
• Others proposed 20 miles
 Independent Payment Advisory Board pending
• 15 members appointed by the President
• Required to cut $13 billion in six years from
CAHs, physicians or other non-hospital
providers (while physician sustainable
growth rate cuts remain unresolved)
Health Reform:
Trends and
Speculations
ACA in Limbo
Meanwhile . . .
 States are spending hundreds of millions of
dollars in federal grant funds to construct health
insurance exchanges
 Insurance plans extended coverage to dependent
children up to age 26
 Minnesota expanded Medicaid to cover childless
adults up to 75% of FPL
All dependent on legality of ACA
Health care reform initiatives
in Minnesota
 Gov. Dayton began early Medicaid enrollment
• 100,000+ people eligible for Medicaid coverage
• Decrease uninsured population by 28,000; decrease
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underinsured population by 75,000
Medicaid is more meaningful coverage with statewide
access to providers
 Gov. Dayton building health insurance exchange
• Using more than $36 million in federal grants
• Controversy with GOP legislators over authority to spend
federal grants without enabling legislation
• State must make substantial progress on Exchange by 2013
or federal government will run MN’s Exchange
Health Care Home:
Minnesota’s medical home model
 Requires certification by the state
 Multiple payers participating
• Medicaid
• State employees
• Medicare
• Commercial
 Care coordination fee varies based on number of
chronic/complex conditions from $10/month for
2 conditions to $60 (Medicaid) or $45/month
(Medicare) for 10 conditions
Health Care Home:
Minnesota’s medical home model
 150 clinics certified in MN so far
• Provide care for 438,000 non-Medicare
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patients, although many, many fewer
have enrolled to receive health care
home services
Total Medicaid care coordination fee
payments to providers are much
smaller than predicted because of
lower-than expected enrollment
Bundled payments
 Lump payment for services patient receives
from multiple providers for same episode or
condition
 Flexibility in program
• Benefits providers assembling bundles
• Makes it more difficult to for other providers to
discern what works, best practices, etc.
 Integrated or collaborative providers have
better opportunity to succeed
Bundled Payments
 MHA members applying for CMS’ Bundled
Payment program
• MHA-led consortium of 8 hospitals
CentraCare
Fairview Southdale
Fairview UMMC North Memorial
Park Nicollet
St. Luke’s
Fairview Ridges
Regions
• Other MHA members submitting applications
Essentia
HealthEast
Mayo
Accountable Care Organizations
 Group of providers that agree to care for an entire
population of patients & achieve quality and cost
thresholds
 Medicare proposed Shared Savings Program
• Min. 5,000 Medicare beneficiaries
• 33 quality measures required to be reported
• 2-4% savings threshold before
eligible for shared savings bonus
• Withhold of 25% of any savings
bonus
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soon
MHA seeking rural ACO models
from CMS Center for Innovation
 Micro-ACOs
• Specify smaller region, subpopulation of patients
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(e.g., dual eligibles), and less financial risk
Focus on total cost of care coordination, not
necessarily total cost of care delivery
 Uncoupled-ACOs
• Non-hospital-provider ACO within community/region
• Allow CAH to retain cost-based reimbursement
• Create financial rewards for ACO/community
providers based on total cost (including
hospitalization) and quality
Accountable Care Organizations
 Three Minnesota health systems certified as
Pioneer ACOs by CMS
• Allina Hospitals & Clinics
• Fairview Health Services
• Park Nicollet Health Services
(also participated in Physician
Group Practice demonstration)
Accountable Care Organizations
Medicaid
 Demonstration projects on the horizon
• State issued Request for Proposals (RFP), which gave
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hospitals more flexibility
Contract negotiations on-going
Nine applicants
CentraCare
Fairview
North Memorial
Children’s Hospitals
FQHCs in Twin Cities
Park Nicollet
Essentia
Mayo Clinic
Allina
 Hennepin County has similar, ambitious project
• Includes corrections, social services, courts, etc. as well
as health care in total cost of care calculation
Examples of ACO considerations
for potential partnerships
 Potential provider/partner must
• Meet defined performance measures on quality,
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experience and cost
Have capability to use ACO network’s resources and
optimize transitions of care
Share clinical and financial data with ACO
Commit to use ACO’s analytics, metrics
Participate in case review and performance
improvement discussions
Use or refer to other ACO network providers
Help reduce ACO network’s readmissions
Health systems are responding to demand for
more integrated care delivery and financing
Questions
&
Discussion