Sellers Dorsey Digest

Federal Updates

News

DOJ Creates New Task Force to Focus on Healthcare Monopolies

• The U.S. Department of Justice (DOJ) has established a new task force, the Antitrust Division’s Task Force on Health Care Monopolies and Collusion (HCMC), that will take on healthcare monopolies and collusion and guide the division’s enforcement strategy and policy approach in healthcare. HCMC will facilitate policy advocacy, investigations, and civil and criminal enforcement in healthcare markets. The goal of the task force is to ensure that monopolies and bad actors are being held accountable for violations of the antitrust laws in the healthcare space. HCMC will be led by Katrina Rouse, a longtime antitrust prosecutor who joined the Antitrust Division in 2011. The HCMC has set up a website HealthyCompetition.gov where the public can share information or concerns about the healthcare system (Fierce Healthcare, May 9; Healthcare Finance, May 13).

Biden Administration Looking to Implement Minimum Cybersecurity Standards for Hospitals

• At the Bloomberg Tech Summit on May 9, Anne Neuberger, the deputy national security advisor for cyber and emerging technology, announced that the Biden administration will soon release rules requiring hospitals to meet minimum cybersecurity standards. This announcement comes in the wake of the Change Healthcare cyberattack, which exposed the healthcare data of 100 million individuals. Additionally, the Biden administration will offer free cybersecurity training to approximately 1,400 small, rural hospitals in the coming weeks (Modern Healthcare, May 9).

Federal Legislation

House Ways & Means Committee Advances Bill to Extend Medicare Telehealth and More

• On May 8, the House Ways & Means Committee advanced legislation to continue Medicare telehealth flexibilities through 2026 and the hospital at home demonstration through 2029. The bill also includes the extension of some Medicare programs for rural and low-volume hospitals and add-on payments for emergency ambulance services through September 30, 2025. To cover these costs, the bill relies on pharmacy benefit manager (PBM) reforms for companies working with Medicare Part D plans and extends pay cuts to clinical labs and hospice. Although official estimates from the Congressional Budget Office are not available yet, committee staff preliminary estimates suggest that the PBM reforms will save the federal government up to $700 million. Several other bills were also sent to the House that aim to assist rural hospitals such as boosting ambulance payments, increasing grants, and requiring a set percentage of graduate medical education training slots go to rural hospitals. Despite overall bipartisan support, some lawmakers were concerned about potential increases in premiums or the lack of safeguards for fraud and abuse (Inside Health Policy, May 8; Modern Healthcare, May 8).

Kansas Senator Plans to Reintroduce MA Prior Authorization Bill

• Senator Roger Marshall (R-KS) plans to reintroduce a bipartisan bill aimed at streamlining Medicare Advantage prior authorization. A similar bill previously passed in the House in 2022 but stalled in the Senate due to high costs. Senator Marshall believes that this bill could see success this year, as cost wouldn’t be an issue, due to CMS’ finalization of the prior authorization rule earlier this year. Senator Marshall believes this bill will further aid Medicare patients and help regulate prior authorization within the private sector, especially regarding prescription drug access (Inside Health Policy, May 8).

Federal Regulation and Guidance

CMCS Extends Unwinding Flexibilities through June 2025

• On May 9, CMCS released an Information Bulletin (CIB) announcing the extension of unwinding flexibilities available through 1902(e)(14)(A) Waivers, verification plan addendums, and regulatory timeliness exceptions, through June 30, 2025. This extension comes as states across the country continue to struggle with the unprecedented volume of renewals and associated administrative burdens beyond their control. KFF analyses estimate that 21 million Medicaid enrollees have been disenrolled so far, and that 70% of these disenrollments are due to procedural reasons or administrative error. The CIB notes that once certain provisions within the “Streamlining the Medicaid, Children’s Health Insurance Program, and Basic Health Program Application, Eligibility Determination, and Renewal Processes” rule become effective on June 3, states will no longer need a waiver to update beneficiary contact information from managed care plans and the U.S. Postal Service National Change of Address database and mail forwarding service. Additionally, the CIB also points out that the rule also repealed the requirement that beneficiaries apply for other benefits to qualify for Medicaid (CMS, May 9; Inside Health Policy, May 9).

CMCS Releases Informational Bulletin Encouraging States to Improve Access to Mental Health and Substance Use Disorder Services for Medicaid and Chip Individuals Experiencing Homelessness

• On May 10, the Center for Medicaid and Chip Services (CMCS) released an Informational Bulletin (CIB) detailing and encouraging states to use the various opportunities available to improve access to care and services for people experiencing homelessness, specifically related to mental health and substance use disorder (SUD) services. CMS urges states to expand efforts to provide mental health and SUD treatment and support services to eligible Medicaid and CHIP beneficiaries. The CIB highlights more recent Medicaid and CHIP coverage and payment opportunities including the Certified Community Behavioral Health Clinic (CCBHC) demonstration, various state plan and Section 1115, 1915(b) and 1915(c) waivers, and managed care in-lieu of services and settings. The document also includes references to additional guidance documents and resources for states relating to evidence-based strategies, like the ones listed in the CIB, to improve outcomes for individuals with mental health and SUD challenges, especially for those who are experiencing or at risk of homelessness (CMS, May 10).

State Updates

News

BCBS Louisiana Leadership Changes Hands

• Steve Udvarhelyi, the former CEO and President of Blue Cross Blue Shield of Louisiana has stepped down and COO and Executive Vice President, Bryan Camerlinck, will assume the role. Camerlinck had previously held numerous positions at BCBS of Kansas City for over 20 years and shifted to BCBS Louisiana in 2016 as CFO before his promotion to COO in 2021. During his time at BCBS Louisiana, Steve Udvarhelyi aided in the payer’s ability to grow enrollment in their Medicare Advantage, Medicaid commercial products. Until his retirement in July, Udvarhelyi will remain as a special advisor to the board and Camerlinck (Health Payer Specialist, May 8).

Governor Newsom Proposal to Address Deficit Includes Reallocation of $6.7B Generated by the MCO Tax

• Governor Newsom’s revised budget proposal, released May 10, included the reallocation of approximately $6.7B from Medi-Cal provider rate increases scheduled to become effective January 1, 2025 to assist in balancing the state budget. The state is now projecting an estimated budget deficit of $27.6B for this year. Additionally, the proposed budget decreases funding for healthcare workforce initiatives through 2028, public health programs, and behavioral health initiatives. Rates increased to 87.4% of Medicare in 2024 for primary care, maternity care, and non-specialty mental health providers. These rates will remain the same, but no additional providers will be added for rate increases (Becker’s Hospital Review, May 13).

SPA and Waiver Approvals

Waivers

• 1115(a)
  • Vermont
    • On April 30, 2024, Vermont submitted a request to amend its section 1115 demonstration titled, “Global Commitment to Health.” The amendment aims to expand access to care for Medicaid enrollees with mental health conditions and substance use disorders (SUD), address whole-person health, and advance payment and delivery reforms. The amendment seeks authority to provide coverage for room and board for enrollees who are in residential mental health and SUD treatment facilities and provide up to six months of medical respite and temporary housing to eligible enrollees under the Supportive Housing Assistance Pilot. Other requests include funding for investments in health-related social needs infrastructure; expanding the Developmental Disabilities Services program benefit package to include environmental and assistive adaption service; and instituting Medicaid hospital global budget payments without being required to reconcile payments against actual fee-for-service utilization. The federal public comment period will be open from May 14, 2024, through June 13, 2024.

SPAs

• Eligibility SPAs
  • Delaware (DE-24-0005, effective January 1, 2024): Updates the state plan to provide 12 months of continuous eligibility for children under the age of 19 enrolled in Medicaid.
  • Rhode Island (RI-24-0004, effective January 1, 2024): Updates the state plan to provide 12 months of continuous eligibility for children under the age of 19 enrolled in Medicaid.
  • Ohio (OH-23-0024, effective January 1, 2024): Adds a performance standard for qualified entities or hospitals to determine presumptive eligibility for pregnant women and/or children.

• Payment SPAs
  • District of Columbia (DC-24-0002, effective January 1, 2024): Updates fee schedule reimbursement rates for physical therapy, occupational therapy, and speech-language therapy service, under the home health benefit, and updates fee schedule reimbursement rates for certain medical supplies and equipment services.
  • Iowa (IA-24-0001, effective January 3, 2024): Implements a tri-annual rate rebase for outpatient hospital services.
  • Texas (TX-24-0016, effective April 1, 2024): Updates the agency’s family planning services fee schedule.
• Services SPAs
  • Hawaii (HI-22-0013, effective January 1, 2023): Adds coverage for palliative care services provided in non-hospital and community settings.
  • Idaho (ID-23-0011, effective January 1, 2023): Updates state plan and Idaho’s Basic Alternative Benefit plan service criteria for Targeted Case Management Services for At-Risk Children, Community-Based Rehabilitation Services for Adults; and Community-Based Rehabilitation Services for Children.
  • Missouri (MO-24-0007, effective July 1, 2024): Adds coverage of developmental disabilities home health services to the Alternative Benefit Plan to align with the Medicaid State Plan.

Private Sector Updates

News

Ascension Experiences Cybersecurity Incident

• Ascension has confirmed that it experienced a cybersecurity incident on May 8, which has caused disruptions in patient care. Local news reports brought attention to patients experiencing long wait times for medical procedures, ambulances redirecting patients, and physicians losing access to medical records. As of May 11, Ascension has not given a timeline for when its systems will be restored. Unusual activity was detected on the company’s technology network in early May, which then prompted the investigation. Ascension has not confirmed if sensitive patient information was compromised but cautioned that business partners should temporarily disconnect from its systems. Based in St. Louis, Ascension operates 140 hospitals across 19 states and the District of Columbia with 134,000 employees and 35,000 affiliated providers (Modern Healthcare, May 9; Modern Healthcare, May 10; Healthcare Dive, May 13).

KFF Releases Health Tracking Poll on GLP-1 Drugs

• KFF recently published their Health Tracking poll, which analyzed the usage and perception of GLP-1 agonists. These medications include Ozempic, Wegovy, Mounjaro, and others that have gained popularity as weight loss drugs, in addition to their other approved uses to treat chronic conditions such as diabetes and heart disease. About 12% of adults reported ever taking GLP-1 drugs, with 6% currently taking the medication. Most adults, 62%, use these drugs to treat chronic conditions like diabetes or heart disease. About 40% of adults took GLP-1 to lose weight. The cost of the drugs was difficult to afford for most users, even with insurance coverage. Across all political views, the majority of respondents supported Medicare coverage of these drugs for weight loss purposes despite the potential concerns about financial strain on the government program (KFF, May 10).

Rand Releases Report Analyzing Commercial Hospital Rates

• On May 13, Rand released a research report analyzing commercial rates for hospital payments paid by employers and private insurers within the US between 2020 and 2022. The study showed significant disparities between states; for example, Arkansas was the only state below 170 percent of Medicare rates, while states like New York and California were above 300 percent of these prices. Rand utilized self-insured employers, state-based all payer claims databases, and health plans that chose to participate within the study; as well as data from over 4,000 hospitals across the nation to better understand standardized and relative prices (Rand, May 13).

Sellers Dorsey Updates

AVAILABLE NOW: Summary of the CMS Ensuring Access to Medicaid Services Final Rule

If you didn’t have time to read the final rule, Sellers Dorsey summarized everything you need to know. Our experts explore the rule’s key provisions including the Medicaid Advisory Committee, home- and community-based services (HCBS) quality and financing, documentation of access to care, and more!

Click here for the summary.