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HR 4302: AHCA, LeadingAge express mixed feelings

April 1, 2014
by Lois A. Bowers, Senior Editor
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Update: President Barack Obama signed the act into law on April 1.

Leaders in organizations representing long-term care providers expressed mixed feelings about the Senate’s passage of H.R. 4302 last night. Among other things, the legislation establishes another one-year patch, or “doc fix,” to the sustainable growth rate (SGR) formula used to pay physicians who provide care under Medicare.

“While it is unfortunate that skilled nursing centers must shoulder the burden for a short-term doc fix, at least it avoids arbitrary cuts to the profession,” Mark Parkinson, president and CEO of the American Health Care Association/National Center for Assisted Living (ACHA/NCAL), tells Long-Term Living.

The bill’s SGR patch negates an automatic, 24-percent payment cut to doctors that was set to go into effect today. This is the 17th patch the government has made to the SGR since enacting it in 1997. Long-term care facilities often see reductions in reimbursements due to offset costs associated with the temporary SGR fixes.

Cheryl Phillips, MD, senior vice president of advocacy and public policy for LeadingAge, tells Long-Term Living that her organization also is satisfied with the proposed law’s SGR fix and other components.

“We are relieved that Congress averted a potential crisis for seniors by providing yet another short-term fix to the way physicians are paid under Medicare, also known as the SGR,” she says. “We are also very pleased that this one-year fix also includes an exceptions process to the therapy caps law, without which people would face significant limits, or caps, to what therapy services were covered.”

Under the current system, Medicare Part B claims for physical, occupational and speech therapy exceeding a fixed dollar amount, or cap, must be manually reviewed by Medicare contractors. The manual review process, according to an AHCA/NCAL issue brief (PDF), is an “administrative nightmare,” with contractors providing inconsistent direction and providers waiting weeks or months beyond what is supposed to be a 10-day review window to receive payment decisions and even longer to receive payments—all the while disrupting care for patients/residents.

Phillips notes that the existing exceptions process has been used since the caps were established in 1997. LeadingAge is disappointed, however, that Congress has not found permanent solutions to the therapy caps and physician payment issues, she adds.

H.R. 4302, also known as the Protecting Access to Medicare Act of 2014, passed March 31 by a 64‒35 vote and had supporters and detractors in both major political parties. It now goes to President Barack Obama, who is expected to sign it into law.

The proposed law also delays for another year mandated use of the International Classification of Diseases and Related Health Problems, 10th Revision, or ICD-10—updated diagnosis and procedure codes to be used by certain payers and healthcare providers, including hospitals and medical practices. This is the third announced delay for compliance with the coding system, which originally was set to go into effect in 2011. The new effective date is Oct. 1, 2015.

And, as previously reported, the act links Medicare reimbursements made to skilled nursing facilities to their hospital readmission rates and delays enforcement of the “two-midnight” payment rule for certain hospital stays.

“We are pleased to see our readmissions proposal serve as the framework for the value-based purchasing program included in this short-term doc fix. Skilled nursing providers are already making progress in this area so, we believe we can make this sacrifice through this more targeted cut,” Parkinson says. “However, any further cuts to the profession would threaten access to skilled nursing care for millions of Medicare beneficiaries.”

For more details about the act, click here.

To see how senators voted, click here.

Related article: Senate passes HR 4302; what it means to SNFs