MEDICAREupdate

January 29, 2016

What’s on the Horizon for Long Term Care in 2016?

Outpatient Therapy Cap and Manual Medical Review

Current Legislation:

• On April 15, 2015, the US Senate passed the Medicare Access and CHIP Reauthorization Act (H.R.2)(MACRA) legislation to repeal and reform the Sustainable Growth Rate (SGR) formula and includes an extension of the Medicare therapy cap exception process through December 31, 2017. MACRA also made provisions to allow CMS to better target manual medical reviews.

Targeted Reviews:

• The statuary mandate for medical review of all claims of $3700 was replaced with a new targeted review process. • CMS cannot use funds for the Recovery Auditors, so the responsibility of these reviews was moved to the Medicare Administrative Contractors (MACs).

Are Recovery Auditors still reviewing claims?

• Currently, the only Manual Medical Review taking place are eligible claims paid in 2014. All claims in 2015 will be covered under the targeted review policy.

What is the therapy cap amount for 2016?

• The annual per beneficiary therapy cap amount is $1960 for physical therapy and speech language pathology services combined and there is a separate $1960 amount allotted for occupational therapy services.

Will the therapy cap with no exceptions process go back into e�ect at some time?

• Yes, the exceptions process along with manual medical review expire on December 31, 2017.

• CMS has not determined how the targeting of claims will be conducted, to comply with the MACRA legislative requirements, but only claims above the $3700 threshold in 2015 will be subject to the targeting.

• It has not been determined if the new targeted MMR reviews will be conducted on a pre-pay or post-pay basis.

• We can expect to receive information by February…

Has the Centers for Medicare and Medicaid Services (CMS) established a policy for the targeted reviews?

• The Centers for Medicare and Medicaid Services (CMS) was instructed to implement the targeted approach no later than 90 days of enactment, and that deadline has expired.

Making compliance less complicated!

Taking a progressive approach to addressing the rapidly

changing healthcare environment.

• Alternative Payment Models (APM) includes models under Center for Medicare and Medicaid Innovation; BPCI is an example, ACO program, Health Care Quality Demonstration

Program and Demonstrations required by federal law.

Cont’d. pg. 2

Are RA audits expanding?

• Currently for Medicare providers, RAs have targeted only Part A and B; however, the Centers for Medicare and Medicaid Services (CMS) proposes to expand the RA audit to Medicare Advantage.

• CMS has published the proposal and seeks comments by February 1, 2016.

Medicare Access and CHIP Reauthorization ACT (MACRA)

Legislative / Timeline Synopsis: This was enacted April 16, 2015

• This repealed the flawed Sustainable Growth Rate (SGR) and provide payment updates through 2019.

• Provides payment updates through 2019

o 0% January – June 2015o .5% July – December 2015o .5% 2016 – 2019*o 0% 2020 – 2025

• *Payment updates end to incentivize providers to participate in a value based payment model.

• Providers choose either: Merit-Based Incentive Payment System (MIPS) or Alternative Payment Models (APM).

What is the di�erence between the two systems?

• Merit-Based Incentive Payment System (MIPS) is a composite performance score assessing quality (PQRS), resources use, clinical practice improvement activities, meaningful use of certified EHR technology.

Recovery Auditor (RA) Update

• The Request for Proposals (RFPs) for the next round of Recovery Auditor Contracts were released November 6, 2015.

• As CMS continues the procurement process for the next round of Recovery Auditor contracts, e�ective November 16th, the current Recovery Auditors may continue active recovery auditing activities including sending additional document request (ADRs) through July 31, 2016.

• ADR limit update! CMS is establishing ADR limits based on a provider’s compliance with Medicare rules. Providers with low denial rates will have lower ADR limits while providers with high denial rates will have higher ADR limits. The ADR limits will be adjusted as a provider’s denial rate decreases, resulting in the provider that complies with Medicare rules having less Recovery Auditor reviews. (E�ective January 1, 2016)

Could a permanent repeal be closer thanwe think?

• Yes, Senator Ben Cardin Amendment was considered by Senate as an amendment to the MACRA, but failed by 2 votes. This would extend the manual medical review for one year at $3700 similar to MACRA, but after one year, a new medical review would be initiated. The reviews would be similar to the targeted reviews, but included a prior authorization component based on factors determined by the Secretary.

• Currently Post-Acute Care groups are trying to negotiate the Cardin Amendment to make it acceptable and not lose gain from the MACRA.

• Action on this will spill into 2016.

Cont’d. pg 3

What happens after 2019?

• Beginning in 2020, payments to certain professionals will be adjusted based on these systems including physicians, physician assistants, nurse practioners, and nurse anesthetists.

• Beginning in 2021, MIPS may apply to other eligible professionals such as rehabilitation therapist.

The Improving Medicare Post-Acute Care Transformation Act

of 2014 / (IMPACT Act)

Legislative / Timeline Synopsis: This wassigned by the President in October 2014.

• Requires Post – Acute Care (PAC) and other providers to report standardized patient assessment data and requires PAC providers to report standardized measures and resource use measures. It also requires the Secretary to modify PAC assessment instruments to allow

submission of standardized patient assessment data to allow for comparison of such data across all providers.

• PAC Providers are defined as: 1) home health agencies (HHA); 2) skilled nursing facilities (SNF); 3) inpatient rehabilitation facilities (IRF); and 4) long-term care hospitals (LTCH).

Standardizing Patient Assessments:

• Post-Acute Care (PAC) providers will report standard patient assessment data by:

o October 1, 2018 for Skilled Nursing Facilities (SNFs), Inpatient Rehab Facilities (IRFs) and Long Term Care Hospitals (LTCH)

o January 1, 2019 for Home Health Agencies (HHA)

• At a minimum this will be reported at admission and discharge.

• The standardized patient assessment data shall include functional status, cognitive function and mental status, special services, medical condition and impairments, prior functional levels, and other categories determined by the Secretary.

• Can providers expect a new assessment tool? No, it is expected that existing PAC instruments will be utilized. 1) Outcome and Assessment Information Set (OASIS); 2) the Minimum Data Set (MDS); 3) the IRF-Patient Assessment Instrument (IRF-PAI); and 4) LTCH-Continuity Assessment and Record Evaluation (LTCH-CARE).

o Section GG is just the beginning…

• The Secretary is required to revise or replace current existing components that are duplicative or overlapping with the new data.

Quality Measures:

By October 1, 2016, PAC providers must report standardized patient assessment data (Section GG). For SNFs that will populate these measures:

• % of residents with new or worsened pressure ulcers

• % of residents experiencing one or more falls with major injury

Will Merit Based Incentive Payment Systems (MIPS) be available for nursing facility therapist?

• At this time, this is not clear. CMS has been engaged on the issue.

IMPACT Act Challenges for Providers:

• CMS is rapidly releasing quality measures for review with minimal turnaround time. Provider groups have expressed concerns to CMS regarding the timelines as it is important that these measures are validated.

• House Ways & Means Committee sta� appear to be sympathetic to industry’s concern on these issues.

21st Century Cures Act

Legislative / Timeline Synopsis: House passed on July 10th, 2015

• Major Bipartisan e�ort of Energy and Commerce Committee to expand patients’ access to treatments, promote drug and device development and increase funding.

• This could impact interoperability, Tele health, X-Ray o�sets and DME o�sets.

Long Term Care – Requirements of Participation

Legislative / Timeline Synopsis: Proposed Rule issued by CMS on July 16, 2015 which is not yet finalized.

• The Proposed rule revises requirements that nursing facilities (NFs) must satisfy to participate in Medicare and Medicaid.

• The requirements for LTC facilities have not been updated comprehensively reviewed or updated since 1991.

Fast Facts:

• Requires NFs to document transfers or discharges in a resident’s clinical record, and to communicate certain information to the receiving setting. Does not require a specific form, format or methodology for communication during transfers.

• Requires in-person evaluation of a resident by a physician, physician assistant, nurse practitioner or clinical nurse specialist before an unscheduled transfer to a hospital.

• Implements discharge planning requirements in the IMPACT Act: Account for quality, resource use and other measures as well as treatment preferences and goals of care of residents.

• Nursing: Did not set federal nurse-to-resident ratio, but requires NFs to determine sta�ng needs based on a competency model and to report sta�ng levels.

• Therapists: Permits physicians to delegate to a therapy provider the authority to write orders for therapy services, as permitted under state law.

• % of resident with an admission and discharge functional assessment and a Care Plan that addresses function

• Medicare spending per beneficiary (Resource Use Measure)

Cont’d. pg. 4

hope for patients & families

in research & innovation

development of new drugs & devices

the approval process

New HHS Value – Based Payment Incentive

Legislative / Timeline Synopsis: Announced by Secretary Burwell in January 2015.

• 30% of Medicare fee-for service payments would be subject to value-based payments through use of alternative payment models by end of 2016

• 50% by the end of 2018

• 85% of all Medicare fee-for-service payments linked to quality or value by 2016

• 90% by 2018

Healthcare Delivery Reform Initiatives

Comprehensive Care for Joint Replacement Model (CJR)

• Final rule issued on November 16; e�ective date pushed back to April 1, 2016.

• Acute care hospitals would receive bundled payments for episodes of care involving lower extremity joint replacement (LEJR) or reattachment of a lower extremity.

• 67 geographic areas. Participants are not participating in Models, 1, 2, or 4 of the BPCI initiative for LEJR episodes. The beneficiaries retain freedom of choice. This is based on 5 years of performance.

CJR – Waiver of 3 day Prior Hospitalization Requirement

• Nursing facilities must have at least a 3-star rating average for at least 7 months of preceding year. CMS is responsible for monitoring and posting the list of qualified SNFs.

Closer look at the “Episode”

• Begins with hospital admission of beneficiaries ultimately discharged under:

o MS-DRG 469 (Major joint replacement or reattachment

of lower extremity with major complications or comorbidities)

o MS-DRG 470 (Major joint replacement or reattachment of

lower extremity without major complications or comorbidities)

• Ends 90 days post-discharge

• Includes all related items and services paid under Medicare Part A and Part B for all fee-for-service beneficiaries, with limited exclusions.

Please contact us if you have any questions.

Leslie Welch, RAC-CT/COTAVice President of Reimbursement

and Regulatory CompliancePhone: (352) 382-1130

Email: corporatecompliance@therapymgmt.com

Cont’d. pg. 5

• CMS believes this model protects against incentives to over-utilize nursing facilities.

• What does this mean? The hospital is going to want to partner with facilities in which the 3 days can be waived to reduce cost included in the bundle.

www.therapymgmt.com8477 S. Suncoast Blvd.Homosassa, FL 34446