News in brief - Nov. 13, 2000

Medicare funding package deadlocked - OIG says Medicare spent millions on excessive hyperbaric oxygen therapy - Proposed rules let states expand Medicaid eligibility

Medicare funding package deadlocked

At press time, health care providers anxiously awaited the fate of a Medicare funding package caught up in a protracted and politically charged fiscal 2001 budget battle.

The Medicare bill, which had been linked to the GOP's tax cut package, would give about $32 billion over five years to providers hurt by cuts in the 1997 Balanced Budget Act.

According to Congressional Budget Office estimates, hospitals would receive $11 billion of the funding, Medicare managed care plans would get $6.3 billion, and the remainder would be split among other providers and patient benefits.

President Clinton said he will veto the bill because it gives too much money to Medicare managed care plans without any guarantees they'll stop dropping out of the program. He also said the GOP has failed to pass a meaningful patients' bill of rights.

The GOP responded that the funding would help ensure that managed care plans remain available to seniors. They also noted that the Medicare package would make available new benefits, such as regular Pap smears and colonoscopy screenings.

OIG says Medicare spent millions on excessive hyperbaric oxygen therapy

Between July 1997 and July 1998, Medicare paid $19 million for hyperbaric oxygen therapy that was inappropriate or excessive, according to an Office of Inspector General report.

A lack of testing before initiating hyperbaric oxygen therapy and monitoring of the treatment once in progress also raised quality of care concerns, the OIG added. Treatments with suspect quality accounted for about $11.1 million in payments.

The OIG recommended that the Health Care Financing Administration initiate a national coverage decision process so it can reexamine which conditions need hyperbaric oxygen therapy. The agency also said HCFA should improve its policy guidance and carrier oversight.

HCFA said it has been concerned about Medicare's coverage policy for this therapy and began to clarify its existing policy in 1999. However, in response to concerns raised by physicians and hospitals, the agency decided to delay implementation of a revised coverage policy so more study and analysis could be done.

The report can be downloaded in PDF format from the OIG's Web site (http://www.hhs.gov/oig/oei/whatsnew.html).

Proposed rules let states expand Medicaid eligibility

The federal government is proposing a new rule that would expand the availability of health insurance under Medicaid to low-income Americans who have overwhelmingly costly medical bills.

The proposal would allow states to disregard portions of a person's income, such as that used for food, clothing or housing, when determining eligibility, according to the Dept. of Health and Human Services. It is expected to be of particular help to elderly people or those with disabilities.