House advances several hospital priorities in sending revised 21st Century Cures bill to the Senate

AHA News

Several of the AHA’s post-election legislative priorities advanced through the House Wednesday with that chamber’s approval of the revised 21st Century Cures bill. In addition to addressing a number of hospital concerns, the legislation also is designed to bolster medical research and revamp the way new drugs and medical devices are approved.

The House voted 329 to 26 to send the legislation to the Senate, which is expected to consider it next week.

Among other AHA-supported provisions, the Cures bill would address the consequences of the 2015 Bipartisan Budget Act on Medicare outpatient payment to provider-based clinics that were under development at the time of the law’s passage; establish a socioeconomic adjustment in the Medicare readmissions program; extend the Rural Community Hospital (RCH) Demonstration program; provide “25% Rule” relief for long-term care hospitals (LTCH); and offer flexibility in physician supervision for critical access hospitals and other smaller rural hospitals.

 

Off-campus hospital outpatient departments. The legislation would revise Section 603 of the budget law to move the grandfather date for off-campus hospital outpatient departments – or HOPDs – under development from Nov. 2, 2015 to Dec. 31, 2016 or 60 days after enactment, whichever is later. Current law reimburses grandfathered facilities at the outpatient prospective payment system rate, while new facilities are paid at a lower rate.

 

Socioeconomic status and Medicare readmissions. The bill would revamp Medicare’s readmissions penalties in a way that accounts for socioeconomic and other social risk factors that are beyond hospitals’ control. Under the legislation, readmissions penalties would be adjusted by comparing hospitals with similar populations of Medicare and Medicaid patients. Those adjustments would eventually change to a “more refined” method based on federal analysis required by the Improving Medicare Post-Acute Care Transformation Act.

 

RCH demonstration. Helpful to many rural hospitals is the bill’s five-year extension of the expiring RCH demonstration program. The program helps rural hospitals – those with between 26 and 51 beds – in sparsely-populated states that are too big to qualify for critical access status, but struggle to keep their doors open under Medicare’s prospective payment system. The program tests the feasibility of a cost-based payment model for these hospitals.

Smaller rural hospitals also gain from a measure that prohibits the Centers for Medicare & Medicaid Services from enforcing controversial direct supervision regulations for 2016. 

 

“25% Rule.” Among other hospital-related measures, the bill would provide one full year of relief from the LTCH 25% Rule. Under the current policy, an LTCH is allowed to admit up to 25% of its patients from a single general acute care hospital; for patients admitted past the 25% threshold, an LTCH faces a significant Medicare reimbursement reduction.

“We commend the Congress for its work on the revised 21st Century Cures bill … as it helps improve hospitals’ ability to treat some of the most vulnerable patients,” AHA Executive Vice President Tom Nickels said a day before House passage of the measure. Nickels added that the AHA would continuing working with lawmakers to address “some outstanding issues, including the relocation of hospital outpatient departments so they can continue to improve patient access to care and making needed changes to allow for flexibility in electronic health record policies.” 

In addition to the hospital-related provisions, the bill would revise rules for clinical drug trials, create new incentives for drug companies to study rare diseases, and add $10 billion to the National Institute of Health’s budget over five years.

It includes nearly $5 billion of research dollars for some new high-profile projects, such as Vice President Biden's push to accomplish 10 years of cancer research in half that time, and also provides about $1 billion to help states respond to the opioid abuse crisis.

The bill would expand access to mental health treatment and services. It would strengthen the enforcement of the mental health parity law which requires insurers to cover mental illnesses just as they cover treatment for diseases like cancer or multiple sclerosis.

Topics: Access and Coverage, Advocacy and Public Policy
Tags: readmissions, site neutral payment, Medicare, advocacy, access, Mental health, Behavioral health, opioids

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