Since the current fiscal year began on Oct. 1, 2017, the federal government has operated on a series of temporary spending bills, known as continuing resolutions (CR), in lieu of enacting appropriations for the full fiscal year. A number of disagreements prevented the two parties from reaching a final agreement on final spending levels.

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While the two parties are in general agreement that the caps on spending that were adopted as part of the Bipartisan Budget Act of 2013 should be raised, they have been unable to come to agreement on the distribution of additional spending between defense and non-defense accounts. This issue, as well as disagreement over how to address other expiring programs and policies, led to expiration of the latest spending bill on Jan. 20 and a temporary shut-down of the federal government.

On Jan. 22, agreement was reached to extend federal funding until Feb. 8, buying additional time for the parties to find common ground on outstanding issues. As part of that agreement, the Senate Majority Leader stated that if the government remained open past Feb. 8, and the parties had still not found common ground on immigration, the Senate would take up legislation addressing the fate of those immigrants who were brought here illegally by their parents when they were children but are currently protected from removal by the Deferred Action of Childhood Arrivals policy, as well as other immigration and border security policies.

The proposal agreed to on Jan. 22 includes funding the Children's Health Insurance Program (CHIP) for six years. Though the authorization for CHIP actually expired at the end of September, the program has continued to operate through of combination of funding rolled over from previous years, reallocations to states that were experiencing shortfalls, and a temporary extension included in the previous CR. The most recent CR also provides for delays in the implementation of several tax provisions, including a two -year delay on the tax on medical devices, a two-year delay in the "Cadillac tax" on high-cost health plans, and an exemption for health plans from the health insurance tax for 2019. (The health insurance tax has already been implemented for 2018.)

There are many more expired or expiring provisions which Congress intends to address during the period prior to Feb. 8. Critical to many communities is the renewal of funding for the Community Health Centers Fund (CHCF), which provides 70 percent of the federal support for Community Health Centers and 100 percent of the funding for the National Health Service Corps. Also expired is support for the Teaching Health Centers graduate medical education program that funds community based residency programs.

Congress must also address the so-called Medicare Extenders—temporary Medicare polices or delays in the implementation of other policies that Congress passes each year. These include extension of the work Geographic Practice Expense Index floor, a potential permanent repeal of therapy caps, and extension of certain hospital programs, such as the inpatient payment adjustments for certain low-volume hospitals and the Medicare-dependent hospital program, home health rural add-on payments, and others. The AMA continues to press Congress to provide technical corrections and extend certain flexibilities to facilitate the successful implementation of the Medicare Access and CHIP Reauthorization Act (MACRA).

On Jan. 11, the Centers for Medicare & Medicaid Services (CMS) announced that the federal government, for the first time, will allow states to test work or community engagement requirements as a condition of eligibility for some Medicaid enrollees. The new policy was issued in the form of a 10-page State Medicaid Director Letter (PDF) to the states, outlining CMS' expectations and detailed guidance for those states interested in adding work requirements to their Medicaid program through section 1115 waiver demonstration projects. Ten states have applied for a federal waiver to add a work requirement, and several other states have expressed interest. One of the states, Kentucky, received approval of its waiver the day after the guidance was issued. For more information on Kentucky's approval, read the complete story in the state section of this issue of AMA Advocacy Update.

In the guidance, CMS encourages states to align work or work-related requirements under Medicaid with work requirements under existing programs, particularly through their Temporary Assistance for Needy Families (TANF) program (e.g., welfare) and the Supplemental Nutrition Assistance Program (SNAP). Populations subject to work promotion/community engagement requirements include working-age, non-pregnant adult Medicaid beneficiaries who qualify for Medicaid on a basis other than a disability (e.g., many in the expansion population, for those states that have expanded).

However, states must comply with federal civil rights laws with respect to "non-disabled" Medicaid individuals who may have an illness or disability as defined by other federal laws (e.g., Americans with Disabilities Act, Section 504 of the Rehabilitation Act of 1973, Section 1557 of the Affordable Care Act, Title VI of the Civil Rights Act, and the Age Discrimination Act) that may interfere with their ability to meet the work requirements. States must ensure that individuals with disabilities are not denied Medicaid for inability to meet these requirements, and have mechanisms in place to ensure that reasonable modifications are provided to people who need them.

Exempt populations include children, pregnant women, the elderly, individuals eligible for Medicaid based on disability, and the medically frail. In light of the nation's opioid epidemic, states will be required to take steps to ensure that eligible individuals with opioid addiction and other substance use disorders have access to appropriate Medicaid coverage and treatment services. AMA policy opposes work requirements as a criterion for Medicaid eligibility.

Last week, the U.S. Department of Health and Human Services (HHS) issued a proposed rule (PDF) that would expand existing protections for the conscience rights of physicians and other health care professionals and personnel who object to performing or participating in certain health care procedures or services. The proposed rule is very broad in scope and covers a wide array of existing federal laws that provide conscience protections, including those related to abortion, sterilization, and certain other health services, to individuals and entities receiving federal financial assistance from HHS. The conscience protections extend, for example, to provision of or assistance with abortions, abortion training, referral for abortions or abortion training, or abortion accreditation standards; conscience protections under the Affordable Care Act (ACA) related to assisted suicide; and conscience protections related to the performance of advance directives.

The proposal would require certain recipients of federal funding from HHS, including grants, loans, Medicare (except for participation only in Part B), Medicaid, and CHIP, to provide notice to individuals, including patients, students, and employees, who are protected under the federal conscience and associated anti-discrimination laws of their rights. It would also require such entities to provide assurance and certification to HHS about their compliance with the requirements of these laws. This rule would not apply to physician offices whose only source of funding is Medicare Part B payments. The rule sets forth in more detail the investigative and enforcement responsibility of the Office of Civil Rights (OCR), the agency within HHS that will administer and enforce the rule.

The AMA is analyzing the current proposal to assess its potential impact on access to care and will submit comments, which are due by March 26.

Despite reservations from several of its members, the Medicare Payment Advisory Commission has agreed to call on Congress to kill the Merit-based Incentive Payment System (MIPS) and replace it with a sweeping new plan that would base payment adjustments on large-scale application of population measures, such as potentially preventable admissions and emergency room visits.
Due in part to heightened concern from several commissioners, the official recommendation is relatively general and would require further development if Congress unexpectedly adopts it. However, the basic concept remains unchanged. Under the Medicare Access and CHIP Reauthorization Act (MACRA), physicians can choose between participation in specific "advanced" alternative payment models (A-APM) or in MIPS, a performance-based fee-for-service system that incorporates elements of three prior programs and offers a number of exceptions and exemptions for practices that are small or have low Medicare volume.
MedPAC staff and commissioners argue that MIPS is too complex and administratively burdensome, relies too much on process measures that must be reported by physicians, has too many of these measures, and will reward or punish physicians based on very small differences in performance. They are also concerned that the possibility of very large MIPS bonuses will deter physicians from moving into A-APMs, which they believe provide more incentives for cost-effective care.
The answer, as MedPAC sees it, is to replace the 300 or so MIPS condition-oriented quality measures with eight or nine claims-calculated measures that would be applied uniformly to physician groups or health systems that are large enough to make this concept statistically viable. Those that did not find and sign up with a group on their own would have the option of participating in regional groups established by the Centers for Medicare and Medicaid Services (CMS). To induce movement into this so-called Voluntary Value Program (VVP), the Commission had tentatively agreed to include a mandatory withhold from Medicare payments. Physicians who did not move into a VVP-type plan would forfeit the withhold. Those who did participate in the VVP would receive positive or negative payment adjustments based on how their performance on population-based measures compared with that of other groups.
Whether a withhold would be required and exactly how big it might be are uncertain.
MedPAC staff had laid out an "illustrative" plan using a 2 percent withhold. In earlier meetings, a number of commissioners had argued that 2 percent was too small. At the January meeting, several commissioners expressed concerns with a withhold, however, and some wondered if a withhold could be avoided altogether by co-opting the $500 million authorized for "exceptional" performers in MIPS. Exactly how big the VVP groups would need to be is also unclear. MedPAC staff has argued that they could be created by physician independent practice associations, county medical societies, hospital medical staffs or virtual groups. The intent, as expressed by several commissioners, is to force physicians to turn quality and efficiency improvement into "a team sport" and to create a system where beneficiaries would essentially be choosing between health systems rather than individual physicians.
No major physician organization has supported the MedPAC proposal, nor is there significant support for the proposal on Capitol Hill where MedPAC's suggestion is viewed as unrealistic, "late to the table," unfair and confusing to physicians who have already invested money and resources to participate in MIPS. Other concerns raised by the AMA and other physician groups include: many physicians wouldn't be able to find an APM that would take them; physicians who treat complex patients or expensive conditions would be especially vulnerable; access to care for patients with these conditions would be compromised because current risk adjusters are inadequate; the population measures MedPAC is advocating have not been tested and won't be helpful to patients who would rather know how an individual physician performs than how the health system performs; and most of the objections MedPAC has to MIPS would also be present in its replacement plan. In lieu of an abrupt about face and institution of a new and even more sweeping change in payment, the AMA and the vast majority of state and specialty medical societies are pressing Congress to adopt a more targeted proposal to provide CMS more time and flexibility to implement MIPS.
In each of the last three MedPAC meetings, only two Commissioners—Alice Coombs, MD, a practicing anesthesiologist and critical care physician and professor in Massachusetts and Virginia, and David Nerenz, director of the Center for Health Policy and Health Services Research at Henry Ford Health System in Detroit—voted against the Commission plan. Their passionate arguments, along with the complete lack of support from the medical profession, created significant doubts for several other commissioners. In response, MedPAC Chair Francis (Jay) Crosson removed any reference to the withhold or its size from the final MedPAC recommendation and promised that the Commission would lay out additional details if Congress adopts its plan.

AMA recently submitted comments on proposed policies for Medicare Advantage and Part D prescription drug plans, many of which had been recommended earlier by the AMA. Once the new rules are finalized, Medicare drug plans will need to consult with patients' prescribing physicians and obtain their approval before placing patients in the special opioid management plans authorized by the Comprehensive Addiction and Recovery Act.

The proposed rule also implements several of the AMA's regulatory relief objectives by:
Eliminating the requirement that physicians and other health professionals be enrolled in Medicare in order for their prescriptions to be covered by Part D.

  • Eliminating required compliance training by plans for physicians.
  • Improving the Medicare Advantage star ratings process.
  • Placing narrow limits on Medicare Advantage automatic enrollment policies (so-called "seamless conversions").
  • Treating follow-on biological products as generics for certain cost-sharing calculations.

The AMA letter also recommended improving access to evidence-based medication-assisted treatment (MAT) for Medicare patients with opioid use disorder. The AMA urged that, in the same way that plans are currently required to cover all drugs in the six protected classes (i.e., anticonvulsants, antidepressants, antineoplastics, antipsychotics, antiretrovirals, and immunosuppressants), they should be required to cover all approved medications for the treatment of substance use disorders. In addition, plans should eliminate barriers to multimodal treatment for pain by covering non-opioid analgesics and non-pharmaceutical treatments for pain.

The interim final rule on Policy on Human Subject Protections (aka Common Rule) (PDF) has been released and delays the effective date and general compliance date of the 2018 Requirements to July 19, 2018. The rule had been scheduled to go into effect Jan. 19, 2018, but research organizations now have until July 19 to comply with its changes. The delay should allow the U.S. Department of Health and Human Services (HHS) to better communicate the changes and allow organizations more time to comply.

The rule defines federal regulations intended to protect human subjects of research from unethical or unscrupulous scientists; in practice, many academics have felt the rules are overly bureaucratic and restrictive and the updated regulation addresses areas of historic vagueness. Studies initiated prior to July 19 would, as a default, continue to be subject to the pre-2018 requirements for their duration. The Obama administration published the final rule exactly a year ago following a long delay. The Trump administration withdrew it immediately along with other regulations when they first took office. HHS' Office for Human Research Protections and its partners are weighing whether to seek public comment on delaying its implementation even longer, until next January or later. Comments are due March 19.

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