Sellers Dorsey Digest

Federal Updates

News

American Medical Association (AMA) President Advocates for Broad Medicare Reforms for Physicians

• AMA President Bruce Scott emphasized the urgent need for Medicare reforms in a recent interview with Inside Health Policy, stating that Congress must address the decline in physician pay, reduce administrative barriers, streamline prior authorization (PA) in Medicare Advantage, and exempt high-approval-rate doctors from PA requirements. Specifically, AMA wants a broad package of legislative reforms, including legislation to reform the current Merit-Based Incentive Payment System (MIPS), R.2474 to tie reimbursement to the annual inflation rate and S.4532 and H.R.4968 to streamline PA processes. AMA has proposed to replace MIPS with a new Data-Driven Performance Payment System (DPPS) that would calculate pay based on performance across categories while tying payments to annual updates and provide for streamlined reporting. If CMS does not provide quarterly feedback reports on quality and cost measures, the DPPS would shield doctors from penalties. Last month, the AMA and 126 other state and national provider groups sent a letter that urged Congress to enact these legislative reforms (Inside Health Policy, August 23).

Federal Litigation

Association for Molecular Pathology (AMP) Files Lawsuit to Challenge Lab-Developed Tests Rule, Cites Loper Bright Enterprises v. Raimondo

• On August 19, the AMP filed a lawsuit in the Southern District of Texas’ Galveston division over the FDA’s decision to regulate lab-developed tests. The lawsuit is the first to cite Loper Bright Enterprises v. Raimondo after the nullification of the Chevron doctrine. This is the second lawsuit that alleges that the FDA does not have the authority to regulate laboratory chemistry (Inside Health Policy, August 22).

DSH Payment Lawsuit Updates

• Several high-profile disproportionate share hospital (DSH) lawsuits have been making their way through the lower courts as CMS and hospitals grapple over how to calculate these critical payments:
  • Baylor All Saints Medical Center v. Becerra: On August 15, the U.S. District Court of Texas sided with co-plaintiffs, Baylor Scott & White Health, ruling that CMS was in the wrong for its Medicare inpatient prospective payment system final rule in FY 2024, for which the agency did not include Medicaid Section 1115 waiver patient days in its DSH payment calculations.
  • Alameda County Medical Center v. Becerra: The plaintiffs believe that CMS failed to compensate them for the Medicare DSH miscalculations made in 2010 in a timely manner. The lawsuit was tossed out in June by the U.S. District Court for the District of Columbia based on a lack of jurisdiction.
  • Hackensack Meridian Health v. Becerra: Following the invalidation of the Chevron doctrine in June, Hackensack Meridian filed a lawsuit that challenges the way in which CMS sets Medicare DSH payments. The plaintiffs believe that CMS should calculate DSH payments by the total patient days for those entitled to SSI benefits not just for those receiving SSI payments and allow for hospitals to view patient-level eligibility data before the issuing of DSH payments.
  • Advocate Christ Medical Center v. Becerra: For the third time since 2019, Oak Lawn and Downers Grove have filed a lawsuit that requests that CMS increase the number of patients to be counted in Medicare DSH calculations by including individuals eligible for SSI benefits. The matter is now before the U.S. Supreme Court to determine whether the appeals court properly ruled in favor of CMS’ decision to not include individuals eligible for SSI benefits in the DSH calculations (Modern Healthcare, August 26).

Federal Regulation and Guidance

HHS Authorizes Additional Round of Free COVID-19 Tests After FDA Grants Emergency Use Authorizations for Two Over-the-Counter (OTC) Diagnostic Tests for COVID-19 and the Flu

• On August 23, HHS authorized and announced another round of free OTC COVID-19 tests for the upcoming respiratory virus season. Four free tests can be requested per household and HHS encourages people to use them during the holiday season when COVID-19 transmission may be prevalent due to larger gatherings. Levels of hospitalization and death related to COVID-19, the flu, and respiratory syncytial virus (RSV) are projected to be comparable or slightly lower than levels seen in 2023. However, these numbers depend on many factors, including vaccination levels. The FDA also published a notice granting emergency use authorization (EUA) for two OTC diagnostic tests, from Nano-Ditech Corporation and ACON Laboratories, that are able to diagnose COVID-19 and the flu (Inside Health Policy, August 23).

Federal Studies and Reports

CMS Releases Several Reports on Medicaid Long Term Services and Supports (LTSS) Trends and Expenditures

• CMS released several publications on Medicaid LTSS users and expenditures from 2019 through 2021, both nationally and on the state level. The publications cover LTSS rebalancing trends, patterns in users, and expenditures for different HCBS services and institutional care. CMS provided a summary table of results, methodology, and information about LTSS data quality (CMS, August 22).

CMS Releases Report on Money Follows the Person Program

• On August 23, CMS released the Money Follows the Person (MFP): Updated Grant Recipient Transitions as of December 31, 2021 Report. The report is based on self-reported data from the MFP grant recipients’ semi-annual progress reports from 2017 through 2021 which summarize progress towards annual goals of transitioning eligible people to the community and increasing Medicaid support for community-based long-term services and supports (CMS, August 23).

State Updates

News

New York State to Allocate $38.8M to Youth Employment Program Aimed to Reduce Gun Violence

• As part of its Gun Involved Violence Elimination (GIVE) initiative, New York State has allocated $38.8M to expand its Youth Employment Program. The program will support 21 counties and provide both paid work and training opportunities for approximately 2,500 low-income and at-risk youth ages 14-20, from September 2024-June 2025. The past program cycle saw approximately 2,650 youth participating and working within schools, libraries, restaurants, and community organizations. The state has reportedly seen a 29% decline in shooting related injuries within the served counties, through July 2024 (New York State, August 22; Finger Lakes 1, August 23).

Pennsylvania Announces Selected Plans for Community HealthChoices Program Re-Procurement

• On August 22, DHS announced the five health plans that will be administering care through Pennsylvania’s Community HealthChoices (CHC) program, which covers dual eligible adults and those who are eligible to receive long-term Medicaid services and supports. The selected plans are Aetna Better Health of Pennsylvania, Health Partners Plans, PA Health and Wellness, UPMC For You and Vista Health Plan. Currently, approximately 411,000 Pennsylvanians are enrolled in the CHC program (Health Payer Specialist, August 26; Commonwealth of Pennsylvania, August 22).

BCBS RI and Point 32 to Challenge Rhode Island’s Medicaid Contract Awards

• In July, Rhode Island awarded Medicaid contracts to begin in July 2025 to UnitedHealthcare and Neighborhood Health Plan of Rhode Island. Since then, BCBS of Rhode Island and Point32Health’s Tufts Health Plan have begun challenging the state’s decision. While Point32Health has not commented, BCBS Rhode Island reports on compliance and consistency issues within the state’s procurement regulations and scoring methodologies within the RFP. (Health Payer Specialist, August 26).

Arizona Deciding Whether to Rebid Arizona Long-Term Care System/Elderly and Physically Disabled (ALTCS-EDP) Contract

• An administrative law judge in Arizona recommended that Arizona rebid the ALTCS-EDP contract citing considerable defects in the procurement process. Arizona Health Care Cost Containment System (AHCCCS) officials have until September 8 to accept, reject, or modify the decision. In December 2023, UnitedHealth Group and Centene were awarded the $1.6 billion contract that provides services to approximately 26,000 individuals in the state. Banner University Family Care, Mercy Care Plan, and BCBS Arizona protested the awards, but the state rejected the protests on February 2. The new contracts were scheduled to launch October 1, but have now been placed on hold based on the administrative law judge’s recommendation for the state to rebid the contract (Health Payer Specialist, August 21).

SPA and Waiver Approvals

SPAs

• Payment SPAs
  • Georgia (GA-24-0007, effective July 1, 2024): Increases reimbursement rates for select occupational therapy, physical therapy, speech language therapy and audiology CPT codes.
  • New Hampshire (NH-24-0008, effective April 1, 2024): Authorizes the quarterly Nursing Facility Medicaid Quality Improvement Program (MQIP) supplemental payment from April through June 30, 2024.
  • Oklahoma (OK-24-0011, effective June 14, 2024): Prohibits third party insurers from denying claims when a Medicaid member failed to obtain prior authorization if the service is covered by a state plan or waiver.
• Services SPAs
  • Georgia (GA-24-0003, effective April 1, 2024): Allows for Licensed Professional Counselors, Licensed Marriage and Family Therapists, and Certified Peer Specialists to deliver and be reimbursed for services by Rural Health Clinics and Federally Qualified Health Clinics.
  • Montana (MT-24-0017, effective July 1, 2024): Provides for 12 months of targeted case management services for high-risk women receiving services at the end of their pregnancies.

Private Sector Updates

News

New Joint Venture set to Launch a Medicare Advantage (MA) Health Plan Based in Pennsylvania

• Highmark Health’s subsidiary Endorsed has formed a joint venture with Michigan’s American Health Plans, two nursing homes, Pennsylvania’s (PA’s) Lake Erie College of Osteopathic Medicine, and HCF Management, and Ohio’s CHR Consulting Services in the creation of a new MA plan for Medicaid and Medicare long-term nursing facility residents in PA. As of 2021, PA had 13,000 older adults eligible for both Medicaid and Medicare although it is unknown how many of these individuals reside in nursing facilities. Pending federal approval, the plan is set to go into effect in January 2025 (Health Payer Specialist, August 21).

Northwell Health Attempts to Acquire Connecticut-Based Nuvance Health Despite Protests

• The New York State Department of Health has approved Northwell Health’s expansion into Connecticut despite opposition from the New York State Health Plan Association. However, Connecticut officials are still reviewing the proposal and are awaiting a full council vote. Northwell is New York’s largest healthcare system and private employer with 21 hospitals, 900 outpatient facilities, and over 10,000 affiliated physicians. Northwell intends to acquire Nuvance Health, which is based in Connecticut and facing economic trouble, losing $70 million a year. Nuvance Health has four hospitals in Connecticut and three in New York. The acquisition is to be cashless, with Northwell becoming the “corporate parent” of Nuvance according to a Northwell spokesperson. The New York State Health Plan Association intends to protest the move, citing financial concerns that the deal would negatively impact payers because of providers gaining more leverage in rate setting. Northwell has told the Connecticut planning committee that there are no antitrust issues with the Federal Trade Commission and maintains that the goal is to preserve access to care in communities served by Nuvance hospitals (Health Payer Specialist, August 26).

Study Finds That Taking Wegovy May Help Decrease Risk of Heart Attack, Stroke, and Cardiac Death

• According to a study published in The Lancet and funded by Novo Nordisk, the maker of Wegovy, taking Wegovy, a class of drugs called GLP-1 Receptor Agonists, may assist in the reduction of risk related to heart attack, stroke, and cardiac death in individuals who are overweight or obese and have heart failure. The study reviewed 17,000 people over age 45 in 41 countries who had diagnoses of pre-existing heart disease. Approximately 4,000 people included in the study had some type of heart failure. On average, those taking Wegovy experienced a 28% reduction in cardiac events, a 24% reduction in the risk of cardiac death, and a 19% reduction in the risk of death from any cause (ABC News, August 23).

National Associations Select Chief Executive Officer After Forming Alliance

• The National Association for Home Care and Hospice (NAHC) and the National Hospice and Palliative Care Association (NHPCO), recently formed a new trade group representing the home health, hospice, and palliative care industries (NAHC-NHPCO Alliance), and has selected its first CEO. Dr. Steven Landers, a board-certified physician in hospice and palliative care, geriatrics, and family medicine begins leading the organization in September after previous positions with the Visiting Nurse Association Health Group and the Cleveland Clinic (Modern Healthcare, August 26).

Sellers Dorsey Updates

Celebrate 200 Issues of the Sellers Dorsey Digest with Chance to Win $200 Visa Gift Card

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