Health System Reform Insight - March 25, 2011
Given the new direction for the nation's health system, the AMA has developed Health System Reform Insight to help you understand the Affordable Care Act and what it means to you and your patients.
Many regulations have been issued or proposed to implement provisions of the Affordable Care Act (ACA) since it became law last year. Following is a review of provisions of the law—separated by topic—that were implemented last year and others that are coming this year.
Provisions implemented in 2010
Coverage expansions. Small business tax credits for employee insurance plans are being phased in, and a temporary reinsurance program has been established for employers that provide coverage for retirees age 55 and older who are not eligible for Medicare. A temporary national high-risk pool provides access to coverage for those with pre-existing medical conditions, and a new website helps patients compare coverage options available in their state. A new state grant program aids the development of health insurance exchanges.
Coverage for children. All insurance policies must allow coverage for dependent children up to age 26. No plans may impose pre-existing condition exclusions for children age 18 and younger.
Insurance market reforms. Lifetime limits and coverage rescissions are prohibited in all health plans, and annual coverage limits are being phased out. All health plans must report their medical-loss ratios, and a process is now in place for states to review the reasonableness of insurance premium increases.
Benefit changes. New health plans must cover certain preventive services and immunizations with no patient cost-sharing requirements. Emergency services are covered with no prior authorization requirements and with in-network, cost-sharing protections.
Medicare changes. Nearly 4 million Medicare beneficiaries who reached the Part D prescription drug benefit "donut hole" received $250 rebates. Physician practice expense payments increased in all Medicare payment localities, with geographic adjustment values below the national average fully funded—with no geographic payment redistributions—through 2011.
Quality improvement programs. A new Patient Centered Outcomes Research Institute was established, as well as a grant program for states to test interventions based on outcomes research among racial and ethnic minority populations. The Centers for Medicare & Medicaid Services (CMS) developed a website that features the Hospital Compare quality tool, which provides quality care information about hospitals, and a Provider Compare website provides general information for patients about physicians and other health care professionals. CMS also initiated a multi-payer advanced primary care practice demonstration program.
Payment and delivery reforms. A new Center for Medicare and Medicaid Innovation was established to examine and pilot-test new models for health care payment and delivery that hold promise for improving quality and cutting costs, such as the patient-centered medical home model and other integrated systems.
Physician hospital ownership restrictions. New physician-owned hospitals needed to provide a Medicare provider agreement by the end of 2010 to qualify for an exception to restrictions on such facilities.
Preventing and detecting fraud. A requirement that all physicians who refer or order services be enrolled in Medicare by July 1 was delayed due to AMA advocacy until CMS can correct problems with the enrollment system.
Implementation efforts in 2011
Coverage expansion. Proposed regulations outline procedures and requirements for states to request waivers from certain ACA requirements that will enable them to implement innovative models for expanding health insurance coverage. The Department of Health and Human Services (HHS) is seeking comments on potential requirements for establishing consumer oriented and operated plans, or CO-OPs. In addition, the AMA anticipates proposed rules for states to establish health insurance exchanges.
Medicare physician payments. Primary care physicians providing a high volume of certain designated services and general surgeons practicing in underserved areas are eligible to participate in a five-year, 10 percent payment bonus program.
Insurance market reforms. Health plans must provide rebates to their enrollees if their medical-loss ratios exceed the required minimum of 80 to 85 percent of premium dollars being spent on health care services. States able to demonstrate that this requirement will destabilize their respective insurance market may apply for a waiver.
Medicare benefit changes. Coverage for Medicare wellness and preventive care services, without patient cost-sharing, is in effect. Beneficiaries who reach the Medicare Part D prescription drug benefit donut hole may purchase brand-name drugs at a 50 percent discount and generic drugs at a 7 percent discount.
Medicaid benefit changes. Medicaid plans must provide coverage for preventive services without cost-sharing and for tobacco cessation services for pregnant women.
Payment and delivery reforms. Regulations will be issued that outline standards for establishing accountable care organizations. In addition, new guidance being developed by the Federal Trade Commission and the Justice Department is expected to ease antitrust rules and other regulations that impede independent physician practices from participating in clinically integrated care models.
Administrative simplifications. The government has collected input on new electronic transaction standards for physician and other provider payments. HHS will begin an effort to establish a uniform ICD-9-CM to ICD-10 crosswalk to ease the transition to the new coding system. Rulemaking is anticipated to begin on establishing a unique health plan identifier system for implementatin for 2012.
Preventing and detecting fraud. New screening procedures were implemented for newly enrolled Medicare providers that place them into risk tiers, with physicians who do not provide office-based, durable medical equipment being placed in the lowest risk tier. Physicians will be required to document a face-to-face visit with patients seeking certification for home health services.
Implementation of the ACA will span several years, with some of the more controversial aspects of the law scheduled to take effect in 2013 and beyond. For example, establishment of a new Independent Payment Advisory Board charged with reducing Medicare spending, essential health plan benefit requirements and public reporting of physician performance information are still to come.
The AMA will continue to work aggressively with Congress and regulatory agencies in its ongoing effort to refine the law and achieve positive results for physicians and their patients. Visit the AMA's health system reform website for detailed information about input the AMA has provided on all these implementation efforts.
Join AMA President Cecil B. Wilson, MD, at 7 p.m. Eastern time for the next Office Hours with Dr. Wilson conference call with AMA members.