Aug. 7, 2014

National Update

Physician groups seek revamp of Sunshine Act roll-out

A coalition of 112 state and specialty medical societies joined the AMA Tuesday in sending a letter (AMA login required) calling on the Centers for Medicare & Medicaid Services (CMS) to reconsider how it is rolling out the Physician Payments Sunshine Act, also known as the Open Payments program.

In particular, the letter urges the agency to maintain the continuing medical education reporting exclusion, which applies when industry donors are unaware of the speakers and other participants before committing to fund the activity. The letter also asks CMS to reconsider its decision not to exclude journal article reprints from Sunshine Act reporting and to postpone the public data release so physicians have more time to complete the cumbersome registration, review and dispute process.

What are physicians experiencing? Physicians have expressed mounting frustration with the Open Payments registration, review and dispute process. Common physician concerns have included the overly complex nature of the registration process and that it takes too long but requires physicians to complete it in one sitting. Added to these concerns is the fact that the Open Payments system has been shut down for maintenance several times.

Encourage your physician members to take a short survey about their experiences with registering in the Open Payments system and reviewing their data, and share their anecdotes in an email to This information will help bolster the AMA's ongoing advocacy efforts.

Important Sunshine Act steps to take: Physicians must complete the three-step registration process and initiate disputes by Aug. 27 to flag potentially erroneous data in the initial public release. Companies, associations and foundations that employ physicians or have physicians on their governing boards should assess whether their employees/leadership have transfers of value that are subject to reporting. Here are the steps to follow:

Physicians should visit the AMA's Sunshine Act Web page for more detailed instructions on how to register in the Open Payments Systems and review their data. Physicians can download the AMA's full Sunshine Act toolkit for practical information on navigating the Sept. 30 public data release.

Congress approves legislation to improve veterans' access to health care

Last week the U.S. Senate adopted the conference report to the Veterans' Access to Care Through Choice, Accountability and Transparency Act of 2014 (H.R. 3230) by a vote of 91-3. The U.S. House of Representatives adopted it earlier in the week by a vote of 420-5. The president was scheduled to sign the bill Thursday.

The primary goals of the bill include the following:

Although the conference process proceeded mostly behind closed doors, the AMA was able to determine at the time of the agreement that the proposed language left significant ambiguity as to whether the VA secretary would have the authority to enter into agreements with private physicians in addition to hospitals and other facilities.

In a rush to finalize the draft, the necessary language was not included. Due to this oversight, the AMA worked with the committees of jurisdiction and leadership to craft necessary language that was passed by a concurrent resolution at the same time that the primary legislation was adopted. This clarifying language ensures that veterans will have access to private physicians who wish to participate in this VA program. The VA will work out the specifics of how the secretary will negotiate agreements with private providers in the coming weeks.

CMS publishes ICD-10 final rule

The sustainable growth rate (SGR) patch legislation signed into law April 1 required that implementation of the ICD-10 code set not occur before October of next year. CMS published a final rule last week officially naming Oct. 1, 2015, as the new compliance date.

The agency has said it will continue to conduct "acknowledgement testing," which essentially would allow physicians to know whether or not their test claim with ICD-10 codes arrived successfully at their Medicare contractor. CMS plans to offer this testing, which started in 2013, again in November, March and June.

The AMA was instrumental in convincing CMS to conduct end-to-end testing as well, which will take place next year. Physicians interested in this opportunity will need to volunteer with their Medicare contractors. "End-to-end" testing will be far more robust than acknowledgement testing. It will allow physicians to ascertain whether or not their claims were processed. The AMA continues to press the agency to conduct end-to-end testing on a broad sample of claims.

Because moving to ICD-10 is incredibly costly and complex, the AMA continues to push for repeal of ICD-10 implementation. It also will continue to share physician concerns with CMS and Congress and look for ways to mitigate the impact on practicing physicians, including further postponing the implementation date. The AMA also is seeking assurances from CMS that it will provide sufficient and timely information of any planned changes to coverage, payment and claims processing based on the conversion to this new code set.

In addition, the AMA will advocate for a Government Accountability Office study to identify steps that can be taken to mitigate the disruption to physicians and other health care providers resulting from a replacement of ICD-9. Additional information about the new deadline and testing can be found in an MLN Matters article.

Insurers shell out $1.9 billion in refunds to patients

Health insurance companies that spent too little on medical care last year had to refund more than $330 million to consumers by Friday in order to be compliant with a little-known provision in the Affordable Care Act (ACA). The total payout since 2011 comes to more than $1.9 billion, according a new report from the U.S. Department of Health and Human Services (HHS).

The refunds stem from what is known as the medical loss ratio, or 80/20 rule, which calls for a minimum of 80 percent of insurance premiums to be spent on medical care or activities to improve health care quality. No more than 20 percent can be devoted to administrative costs and profit. In large group markets, the ratio is more stringent, at 85/15.

The AMA played a key role in supporting this rule to prevent health insurers from diverting patients' premium dollars away from medical care.

Through its advocacy efforts to the National Association of Insurance Commissioners, the AMA prevented the health insurance industry from undermining this important patient benefit from the health care law. More recently, the AMA was instrumental in blocking revisions (AMA login required) to the rule that would have provided considerable wiggle room for insurers to reduce their required refund payments and get away with not being fully compliant with the law each year. Read more at AMA Wire®.

FDA proposes framework for regulating laboratory-developed testing

A long-delayed draft framework for how the Food and Drug Administration (FDA) will regulate laboratory-developed testing services (LDT) was released July 31. 

LDTs are defined by the FDA to be "a type of in vitro diagnostic test that is designed, manufactured and used within a single laboratory." The FDA has asserted that LDTs, although performed in laboratories and subject to regulation under the Clinical Laboratory Improvement Amendments (CLIA), have long been considered "medical devices" by the FDA. However, the FDA until recently generally has not exercised what the agency characterizes as its enforcement authority.

The FDA is required to notify Congress 60 days before it issues a proposed framework for public comment. Under the draft guidance, the agency identifies what it proposes to be high-risk LDTs that will be subject to pre-market clearance. The agency proposes to include in the high-risk category LDTs that compete with FDA-approved or cleared companion diagnostics currently on the market. The draft guidance also includes the agency's proposal for the categorization of LDTs that are low- or moderate-risk, which would be subject to registration requirements, in addition to the regulation and document requirement under the CLIA.

LDT services offer patients access to safe and high-quality diagnostic services that are essential to patient care. The draft FDA framework, however, raises a number of questions and concerns. If finalized, it would add an additional layer of regulatory requirements that may result in patients losing access to timely life-saving diagnostic services and hinder advancements in the practice of medicine. The AMA is committed to ensuring that the proposal ultimately adopted by the FDA preserves rapid access to care and medical advancements. The AMA is carefully reviewing the draft guidance to ascertain the full impact for physicians and their patients.

Congress has 60 days to review the proposal before the FDA may open the public comment period, which will last 90 days. The FDA also plans on hosting a public meeting during the comment period. Read more in an FDA news release.

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Issue Spotlight

How states are taking on the national Rx abuse crisis

As the nation's prescription drug abuse crisis continues its devastating course—with 46 people dying every day from overdose and many more requiring hospitalization—physicians and policymakers are trying to tackle the issue head on, at both the national and state levels.

Here are some key ways prescription drug abuse is being addressed in the states:

Overdose reversal legislation: Many state lawmakers have embraced the opportunity to help prevent opioid overdose deaths by supporting legislation for the overdose reversal drug naloxone. As of mid-May, 24 states and the District of Columbia passed laws to increase access to this life-saving antidote, according to a report of the Network for Public Health Law. "Good Samaritan" laws that encourage people to call for medical aid in the event of a drug overdose also have been adopted in 16 states and the District of Columbia.

The AMA and numerous state and specialty medical associations have been instrumental in supporting and securing enactment of these laws over the past few years.

While these laws provide access to a key medication for saving lives, they are only a part of the bigger picture. A comprehensive public health approach with a focus on prevention and treatment is essential to help get this ever-growing crisis under control.

Access to addiction treatment and recovery programs: As the National Governors Association continues its work to develop recommendations for addressing drug abuse, the AMA has helped convince this influential group (AMA login required) to place a greater emphasis on treatment programs to help break the cycle of addiction. That includes removing barriers to access and making treatment programs more affordable.

Prescription drug monitoring programs (PDMP): Many states have turned to these data registries to track patients' use of prescription drugs. Unfortunately, many programs are underfunded and inadequately maintained. The AMA is calling for state governors and lawmakers to focus on making real-time data available and enabling interstate interoperability to make sure data is shared properly.

Additionally, the AMA has urged the National Conference of Insurance Legislators (AMA login required) to consider how PDMPs can be used as beneficial clinical support tools.

Clinical standards: Some states have considered mandating standards of care for prescribing painkillers, but the AMA is advocating for a more targeted approach that allows physicians to exercise the appropriate balance between preventing overuse of drugs and under-treatment of pain. A patient-specific focus, not a "one-size-fits-all" approach, is required to achieve this goal.

Task forces, public education and drug take-back: Other community leaders also are increasing efforts around this issue. Active prescription drug task forces are in 34 states, up from 29 in 2012, according to a recent survey of the National Association of State Alcohol and Drug Abuse Directors.

A number of states also have established ongoing drug take-back programs to help residents dispose of unused medications. Kentucky, for instance, offers disposal locations in 110 of its 120 counties. Oklahoma also has a statewide plan, and Pennsylvania offers an online map of safe disposal locations. Several other states have passed legislation around making these programs available.

Read more online about the AMA's efforts to combat prescription drug abuse and diversion in the states and at the national level.

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State Update

Heroin use among chief concerns of drug and alcohol abuse directors

In a recent report, the National Association of State Alcohol and Drug Abuse Directors highlighted its members' perspectives about the increasing use of heroin in the United States. From 2010 to 2012, there was a 16 percent increase in admissions for treatment related to heroin use and a 13 percent increase in admissions for treatment related to opioid use. Only 26 states reported that they have expanded medication assisted treatment services.

The AMA strongly supports increased access to treatment for drug addiction and physician office-based treatment of opioid addiction. That is why the AMA supports S. 2645 (AMA login required), the Recovery Enhancement for Addiction Treatment Act (TREAT Act), recently introduced by U.S. Sen. Edward Markey, D-Massachusetts. The TREAT Act would increase the number of patients physicians are able to treat for addiction recovery on an outpatient basis.

NAIC model network adequacy law to be revised

A series of open meetings are kicking off the initial stage of the process to update the National Association of Insurance Commissioners' (NAIC) model network adequacy law, which will provide the nation's insurance commissioners with a highly detailed framework for legislative and regulatory guidance.

The AMA and other medical associations have been participating in these meetings, urging the organization to adopt strong transparency requirements and to include provisions that:

Read more about the AMA principles (AMA login required) for establishing and monitoring an adequate network.

Tanning restrictions for minors enacted in six states

As summer rolls on, tanning legislation continues to protect the public health. Six states this year have successfully enacted laws to regulate indoor tanning for minors.

The most comprehensive laws were passed in Delaware, Hawaii and Louisiana, which ban all use of ultraviolet tanning devices by anyone younger than 18. Delaware prohibits minors between the ages of 14 and 18 from using a tanning device, Indiana's new law prohibits minors younger than 16 from using tanning devices, and Alabama's new law prohibits use by minors under the age of 15.

Missouri took a different approach and now prohibits minors under 17 from using a tanning device unless the minor provides a consent form signed by the parent or legal guardian at the time of first exposure and submit a yearly consent form thereafter.

Read an AMA issue brief (AMA login required) about tanning restrictions for minors.

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Judicial Update

In split decision, court upholds Florida's "gun gag" law

The recent ruling of a court of appeals means a 2011 law in the Sunshine State will stay on the books—despite the fact that it intrudes upon the physician-patient relationship and will negatively impact public health.

The Florida law, which bars physicians from freely discussing firearm safety with their patients, originally was put on hold when physicians challenged it and earned a court ruling that found the law unconstitutional. But the law's supporters appealed the decision, bringing the case before the three-judge panel of a U.S. court of appeals. While the law was upheld, the court opinion was split, with one of the three judges siding firmly with physicians.

"The record and common sense lead inexorably to the conclusion that children will suffer fewer firearm-related injuries if they—and their parents—know more about firearm safety," Judge Charles R. Wilson wrote in a lengthy dissenting opinion. "But now they will know less."

Both the majority and the dissenting opinions repeatedly turned to the friend-of-the-court brief written by the AMA and filed alongside 12 other medical associations. But physicians' expert insights and proven success in increasing patient safety don't always win out.

"The political interests of state lawmakers do not justify infringing on the patient-physician relationship and stifling relevant medical discussions that are proven to save lives," AMA President Robert M. Wah, MD, said in a statement following the ruling. "In addition to putting patients in harm's way, the Florida Privacy of Firearm Owners Act infringes on a physician's right to free speech and puts physicians in the untenable position of risking disciplinary consequences or abandoning ethical obligations."

The AMA is continuing its efforts to oppose governmental intrusions into the clinical examination room and calling on lawmakers to leave decisions about medically necessary treatment in the hands of physicians and their patients.

The plaintiffs have announced plans to seek reconsideration of the decision in the 11th Circuit of Appeals. If so, the AMA will lead another friend-of-the-court brief in their support.

The injunction blocking enforcement of the law will remain in effect until the court decides whether to reconsider the case. If the court agrees to a re-hearing, the injunction will remain in effect until the decision is issued. Legislation similar to Florida's law was introduced in five states this year—Missouri, Ohio, Oklahoma, South Carolina and Tennessee. None of these bills have been enacted yet.

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Other News

Medicare quality and resource use reports to be released

Physicians will receive a confidential feedback report next month from Medicare, detailing how the cost and quality of care they provided to their Medicare patients in 2013 compares to that of other physicians.

Large groups of 100 or more practitioners also will learn whether their Medicare payments next year will be affected by a new Value Based Modifier (VBM), which will bring bonuses to some physicians and financial penalties to others. Smaller practices will get a preview of how they may fare as the VBM is phased in over the next three years.

Under the Affordable Care Act, the Centers for Medicare & Medicaid Services (CMS) is required to apply the VBM to some physicians in 2015 and to all physicians in 2017. The agency has chosen to apply it to groups of 100 or more in 2015, groups of 10 or more in 2016, and all groups and solo physicians in 2017.

Adjustments will be based on cost and quality data from two years earlier. That means the forthcoming data, known as "Quality and Resource Use Reports" (QRUR), will determine payment adjustments next year for the groups of 100 or more physicians and other practitioners. The reports will identify which groups will receive positive adjustments, which will see no change and which will be subject to payment cuts of up to 1 percent.

Because the underlying policies that determine the VBM are changing each year, the 2013 reports are not a perfect indicator of the likely impact of the VBM on physicians who will be subject to payment adjustments of up to 2 percent in 2016 and a proposed 4 percent maximum penalty in 2017. But they will serve as a guide to potential VBM adjustments in the future.

For physicians in group practices, data is provided at the group level with drill-downs for individual physicians' quality data. CMS first began providing QRURs to limited numbers of physicians in 2011 and has expanded availability over time. Reports using 2012 data already are available for groups of 25 or more practitioners, and the 2013 data will be posted in September.

The process for gaining access to the reports is complicated and requires a user ID and password for the "Individuals Authorized Access" to the CMS computer services (IACS), which must be renewed periodically. In preparation for the release of the 2013 reports, physicians are advised to make sure their group has an up-to-date IACS password. Visit the IACS website to learn more. Information about the QRURs and the VBM, including a quick reference for obtaining an IACS account, can be found on the CMS website.

Register today for September AMPAC Federation meeting

State society political action committee (PAC) chairs and directors are invited to the annual AMPAC Federation Meeting in Washington, D.C., at the Grand Hyatt Washington. The program will take place Sept. 18 and the morning of Sept. 19.

AMPAC encourages its Federation guests to schedule meetings with their congressional delegations Sept. 18, preferably in the morning. Hill visits will be followed by lunch at the Hyatt and fundraising training, discussion of innovative state programs and a preview of the 2014 elections by Stu Rothenberg, editor and publisher of the Rothenberg Political Report. Thursday evening will feature a reception in honor of participants.

The room block has been arranged for a Sept. 17 arrival and Sept. 19 departure. AMPAC will reimburse PAC directors and PAC chairs for two hotel nights each. The room block will be held through Aug. 18. Email Jim Wilson, AMPAC staff, for a registration form.

Newly updated tool helps physicians understand electronic remittance advice

Receiving the intended benefits from standardized electronic remittance advice (ERA) requires physician practices to act upon coding used in the transaction, but interpreting these codes and determining whether submitted claims were paid properly can be a major hassle.

The AMA's Claims Workflow Assistant tool helps physicians and their practice staff understand ERAs, advocate for accurate payment and take appropriate action on claim denials.

The newly revised tool reflects the most recent code combination update from the Council for Affordable Quality Healthcare Committee on Operating Rules for Information Exchange and now includes property and casualty (workers' compensation and auto injury) work flows. This tool lets users look up the reason and remark codes that payers place on ERAs and provides associated step-by-step work flows that address reasons for claim denials and non-payments. Additionally, a glossary and instructions are available to orient new users and ensure maximum utility of the tool.

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News You Can Use

Following is suggested content to use in your association's communication vehicles beginning in August. Please email Terri Marchiori of the AMA to let us know which materials you're placing, your distribution channels, the response from your members and any other metrics, such as audience reach.

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