Washington Highlights: July 27,
2007
House Proposal Reauthorizes SCHIP, Medicaid Provisions
Contents
Prior Issues
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The House Committee on Ways and Means July 27 passed, 24-17, the
"Children's Health and Medicare Protection (CHAMP) Act"
(H.R.
3162). At press time, the Energy and Commerce Committee hoped
to complete its mark-up July 27 for the bills to be combined before
House floor consideration the week of July 30.
The bill reauthorizes the State Children's Health Insurance Program
(SCHIP) and several Medicaid provisions. According to preliminary
Congressional Budget Office (CBO) estimates, H.R. 3162 as introduced
preserves the enrollment of 1.9 million beneficiaries who likely
would lose coverage under current funding levels. The measure covers
1.1 million SCHIP-eligible and 3.6 million Medicaid-eligible children
who are not yet enrolled in the programs, and it further expands
SCHIP eligibility to 1 million more children. Under H.R. 3162, the
CBO expects 2.4 million children to drop private coverage for Medicaid/SCHIP
coverage.
CHAMP Act provisions of particular interest to teaching hospitals
and medical schools include a reconfiguration of the SCHIP allotment
methodology to better account for population growth and increases
in national per capita health expenditures. The new methodology
(estimated to cost $21.9 billion over 5 years) also provides a "shortfall
adjustment" for certain states that exceed their projected
level of expenditures. The CHAMP Act also reduces to 2 years the
time states may access their allotments before redistribution, and
establishes a proportionate redistribution system for unspent allotments.
The bill creates "performance bonus payments" for states
that exceed specified Medicaid/SCHIP enrollment levels while implementing
specific outreach and retention practices ($10.8 billion over 5
years). The CHAMP Act includes options for expediting Medicaid/SCHIP
eligibility determinations and enrollment, including changes to
current citizenship documentation requirements ($0.8 billion over
5 years). It permits Medicaid/SCHIP coverage of certain legal immigrants
($0.9 billion over 5 years) and children that "age-out"
of the programs ($0.9 billion over 5 years). Under H.R. 3162, qualified
states may cover certain pregnant women under SCHIP ($0.7 billion
over 5 years). The legislation also establishes minimum coverage
thresholds that states must achieve before requesting a waiver to
cover adults under SCHIP.
The CHAMP Act also creates a "Children's Access Payment and
Equity Commission" modeled after the Medicare Payment Advisory
Commission, calls for a pediatric healthcare quality measurement
program, and changes the program's name to "CHIP."
Information:
Christiane Mitchell, Director, Federal Affairs
AAMC Government Relations
cmitchell@aamc.org
(202) 828-0526
House SCHIP Bill Includes Physician Fix, Hospital
Provisions; AAMC Issues Letter of Support
The House Democrats' $90 billion State Children's Health Insurance
Program (SCHIP) bill (H.R.
3162), as introduced July 25, includes important Medicare provisions
of interest to physicians and hospitals.
H.R. 3162's key physician payment provisions include:
- Providing payment updates of 0.5 in Calendar Years 2008 and
2009;
- Establishing six separate categories defined by type of service
with their own target growth rates, replacing the Sustainable
Growth Rate system. The six categories include primary and preventive
services, other evaluation and management services, major procedures,
anesthesia services, imaging services, minor procedures and other
services;
- Effective 2008, prospectively removing the cost of Part B drugs
and lab tests from target growth rate calculations and increasing
target growth rates by requiring CMS to include new national coverage
determinations;
- Establishing mechanisms to provide feedback to physicians on
how their practice patterns compare with their peers;
- Requiring accreditation of staff and equipment as a condition
of payment for imaging services beginning in 2012 for ultrasound
and in 2010 for other services ranging from x-rays to PET scans;
- Initiating an expanded medical home demonstration program for
up to 500 medical practices;
- Extending the work Geographic Practice Cost Index floor and
physician scarcity area provision for two years;
- Creating an expert panel to help identify misvalued services
to be included in the five-year review of relative values; and
- Effective in 2009, providing a 5 percent bonus payment to physicians
in areas with the lowest per capita Medicare spending.
According to an analysis by the American Medical Association, beginning
in 2010, physicians would face payment cuts of 12 percent in 2010
and 2011 instead of 5 percent. The Congressional Budget Office has
estimated that the physician payment provisions would cost $20.1
billion over 5 years and $100 billion over 10 years.
H.R. 3162's key hospital provisions include:
- Reducing inpatient and outpatient market basket updates by 0.25
percentage points in FY 2008, an estimated savings of $1.1 billion
over 5 years and $2.7 billion over 10 years;
- Limiting certain physician referrals to hospitals, an estimated
savings of $700 million over 5 years and $2.9 billion over 10
years;
- Providing regulatory relief for inpatient rehabilitation facilities
by permanently freezing the "75 Percent" rule at 60
percent; and
- Rebasing PPS exempt cancer hospitals.
CHAMP also includes provisions similar to those in the "Enhanced
Health Care Value for All Act" (H.R.
2184), to promote comparative effectiveness research through
the Agency for Healthcare Research and Quality (AHRQ) [see
Washington Highlights, May 11]. The initiative is financed
by the Medicare Parts A and B Trust Funds, the Medicare Prescription
Drug Program, and a "fair share per capita" contribution
from private health plans.
The bill is paid for in part by increasing tobacco taxes by $0.45
per pack. The tobacco related provisions are estimated to increase
revenues by $27 billion over 5 years and $54 billion over 10 years.
Provisions to equalize Medicare Advantage's payments with Medicare
fee for service payments are estimated to save $50.4 billion over
5 years and $157 billion over 10 years.
The AAMC July 26 sent a letter
of support for the CHAMP Act, as introduced. In addition to commending
the bill's SCHIP provisions, the letter states the bill's physician
payment relief is "of particular significance to clinical faculty
group practices at medical schools, given their large volume of
Medicare patients." The letter notes that legislation will
be needed to counter the physician payment cuts beginning in 2010.
Regarding the bill's hospital payment provisions, the letter states,
"We also appreciate that your bill rejects the Administration's
proposal to eliminate teaching hospitals' Medicare indirect medical
education payments associated with Medicare Advantage enrollees."
The AAMC letter expresses concern with the hospital update provision
and urges reconsideration of the provision..
Information:
AAMC Government Relations
Senate Passes Higher Education Overhaul
The Senate July 24 passed the "Higher Education Amendments
of 2007" (S.
1642) to reauthorize the Higher Education Act (HEA, P.L.
105-244) for 5 years. The legislation includes the non-budgetary
provisions of the HEA, such as increased oversight of student lending
and changes to accreditation [see Washington
Highlights,
June 22]. The HEA was last renewed in 1998.
At the conclusion of the floor debate, the Senate approved an amendment
offered as a compromise of Sen. Tom Coburn (R-Okla.) and Committee
on Health, Education, Labor, and Pensions (HELP) Chair Edward M.
Kennedy (D-Mass.). The amendment bars institutions from using student
aid money or funds from federal contracts, grants, loans or cooperative
agreements for lobbying purposes, and requires schools to certify
to the Secretary of Education that they are abiding by those terms.
The Senate also approved an amendment offered by Sen. Jeff Sessions
(R-Ala.), which requires a GAO study on "American students
receiving Federal financial aid to attend graduate medical schools
located outside of the United States." The study will include
information on Educational Commission for Foreign Medical Graduates
(ECFMG) examinations passage rates, foreign medical graduate (FMG)
distribution, and FMG medical malpractice lawsuits. The amendment
would also increase from 60 percent to 75 percent the ECFMG passage
rate needed for foreign medical schools to establish Title IV student
aid eligibility.
Kennedy has expressed hope that they could conference with the
House prior to August recess, but House Education and Labor Chair
George Miller (D-Calif.) has stated that the House will introduce
its own non-budgetary reauthorization bill later in the year, postponing
further action on the HEA reauthorization. The AAMC July 11 sent
a comment letter
to the House and Senate education committee leadership in anticipation
of conference negotiations [see Washington
Highlights,
July 13]. Authority under the HEA expired Sept. 30, 2003; however,
several extensions have been enacted, making no policy changes but
allowing uninterrupted administration of education programs. The
Senate July 24 and House July 25 passed the "Second Higher
Education Extension Act of 2007" (S. 1869) to extend the HEA
until Oct. 31, 2007.
Information:
Matthew Shick, Senior Legislative Analyst
AAMC Government Relations
mshick@aamc.org
(202) 862-6116
CMS Issues Second Reconsideration of Clinical
Trial Policy
The Centers for Medicare and Medicaid Services (CMS) July 19 posted
its "Proposed Decision Memorandum
for Second Reconsideration of the Clinical Trial Policy."
CMS has made a number of changes to the proposal that was issued
in April but never finalized [see Washington
Highlights, April 13].
Under the current proposal, qualifying for Medicare coverage will
involve meeting 13 standards of a clinical research study, including
registration on ClinicalTrials.gov prior to enrollment of the first
study subject, public release of all "pre-specified outcomes
to be measured" within specified time frames, and a written
protocol that clearly "addresses, or incorporates by reference,
the Medicare standards." Federally funded studies-previously
considered by many to have "deemed" status- now will receive
the same treatment as studies funded by other sources. "Study
sponsors/principal investigators" must certify to CMS that
the Medicare standards have been met. CMS will pay for certified
studies "unless the CMS' Chief Medical Officer finds that the
study does not meet the criteria outlined in this policy or the
study jeopardizes the health or safety of Medicare beneficiaries."
Although a recently issued CMS decision memorandum seemed to indicate
otherwise [see Washington Highlights,
July 13], CMS now has stated explicitly that "items and
services furnished to Medicare beneficiaries in clinical research
studies that do not meet the requirements of this policy are not
covered." All items and services within clinical research studies
remain subject to local coverage determinations, so coverage in
a multi-site trial may vary from site to site.
This policy will not apply to any clinical research study that
was covered under any previous policy that began enrollment prior
to the effective date of this decision.
Comments must be submitted electronically on the CMS website by
Aug. 18. CMS will hold an Open Door Forum to solicit public comments
on Aug. 7. The AAMC is reviewing this proposal and discussing it
with members in preparation for comment submission.
Information:
Ivy Baer, Director & Regulatory Counsel
AAMC Health Care Affairs
ibaer@aamc.org
(202) 828-0490
House, Senate Panels Approve FDA Spending Bills
The House and Senate Appropriations Committees July 19 approved
their respective FY 2008 Agriculture, Rural Development, Food and
Drug Administration Appropriations bills.
According to a summary
prepared by the House Appropriations Committee, the House bill (H.R.
3161) provides $18.8 billion in discretionary spending, including
$1.69 billion for the Food and Drug Administration (FDA). The FDA
funding level represents an increase of $121 million (7.7 percent)
over FY 2007. The bill also prohibits FDA advisory committee waivers
for conflicts of interest.
Meanwhile, the Senate Appropriations Committee July 19 approved
its version of the spending bill (S.
1859), providing $18.7 billion in discretionary spending. The
FDA receives $1.75 billion, an increase of $180 million (11.5 percent)
over FY 2007.
The FDA budget is supplemented by revenue generated from user fees,
adding approximately $500 million to the appropriated levels.
Information:
Tannaz Rasouli, Senior Legislative Analyst
AAMC Government Relations
trasouli@aamc.org
(202) 828-0525
Congress, Voters Participate in Survey on Health
Issues
Members of the "Your
Congress-Your Health" initiative July 19 unveiled an interactive
website chronicling federal lawmakers' and voters' views on health
and research issues, including support for the National Institutes
of Health (NIH), federal funding for embryonic stem cell research,
and health care coverage for all Americans. The site features a
searchable database cataloguing Congressional participants' responses
to 15 questions on health and research issues. Questions were developed
on the basis of a national poll of registered voters. To date, nearly
one-fourth of the current Congress has responded to the survey.
The AAMC is a supporting partner in the initiative, led by Research!America
and the Albert and Mary Lasker Foundation.
Physician Wins House Special Election Runoff
in Georgia
Georgia Republican Paul Broun, M.D., was sworn in July 25 to represent
the state's 10th District in the House of Representatives. Rep.
Broun will succeed Rep. Charlie Norwood (R-Ga.), who died in February.
A graduate of the University of Georgia, Rep. Broun earned his
medical degree from the Medical College of Georgia in Augusta. He
has experience both as a family physician and emergency medicine
physician. His committee assignments include a seat on the Homeland
Security Committee, as well as the Committee on Science and Technology.
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