Congress Focused on Home Health Care

While Congress permanently fixed the perennial Medicare physician payment reform issue earlier this year, Congress has been consumed with a new and wide array of health and Medicare issues, including home health care, which will continue through the end of this year.

The Supreme Court’s decision in King v. Burwell will dictate additional Congressional and state activity this year, depending on how the court decides the issue of whether the Internal Revenue Service was right to allow health insurance subsidies to flow to citizens in states using the federal exchange. If the Supreme Court strikes down the Obamacare subsidies, many in D.C. believe the law and marketplaces will fall into 34 simultaneous death spirals. If the conservative challengers lose the case and the Supreme Court decides the federal government is on the right side of the law, nothing of substance will change, although it would mean a huge political win for the Obama Administration. If that happens, expect the Republican Congress to focus on small policy patches moving forward.

Apart from King v. Burwell, as June started out, both the House and Senate busied themselves with a plethora of health care issues. The House Ways and Means Committee on June 2 voted to repeal the Affordable Care Act’s 2.3 percent medical device tax, with only one Democrat voting for the device tax repeal bill. As an industry, we were successful in working with the Internal Revenue Service to ensure its regulations carried out Congress’ objective of exempting from the tax retail items such as home medical equipment. Repeal of the entire device tax remains a top priority of Republicans in Congress. The Republican House has voted three times to repeal the medical device tax since 2010; and in 2013 the Senate approved repeal through a non-binding vote. Senate Finance Committee Chairman Orrin Hatch (R-UT) introduced this year a repeal bill in the Senate that has garnered some Democratic support, but no vote has been scheduled. While there appears to be momentum on repeal of this tax, most believe that President Obama would veto the measure, if it were to get through the House and Senate.

Also in early June, the House Ways and Means Committee passed a bill that would repeal the controversial Independent Payment Advisory Board, five Medicare Advantage reform bills, a long-term care hospital bill and a bill that would require Medicare to cover certain disposable medical equipment as durable medical equipment. The House Ways and Means Committee also approved a bill that would extend the Medicare Independence at Home Medical Practice Demonstration Program from three to five years, a bill the Senate passed in April 2015 (S. 971). This demonstration aims to test the effectiveness of delivering comprehensive primary care services at home, and if doing so improves care for Medicare beneficiaries with chronic conditions. On the same day, the Committee also approved the so-called “Steve Gleason” Act, a bill already passed by the Senate that would facilitate beneficiary access to speech generating devices.

On the Senate side, the Finance Committee in early June advanced bipartisan legislation to overhaul the Medicare audit and appeals process. The Audit and Appeal Fairness, Integrity, and Reforms in Medicare (AFIRM) Act is sponsored by Finance Committee Chair Orrin Hatch (R-UT) and ranking Democrat Ron Wyden (R-OR), who called the current audit and appeals system “bureaucratic water torture.” The Senate Finance Committee approved by voice vote the chairman’s mark of the bill that would enhance oversight of Medicare audit contractors and streamline the methods used to address the growing number of appeals. The measure’s support in Congress is a result of the recognition that the number of Medicare appeals has grown at a rate that is unmanageable for the current system. (The Finance Committee approved what it calls a “conceptual mark,” which is a detailed description of the bill, but has not yet been translated into legislative language.)

The Senate AFIRM Act would require that the Office of Medicare Hearings and Appeals (OMHA) and the Departmental Appeals Board receive $127 million annually; a budget designed to address the backlog within six to twelve months and then be able to keep up with the appeals workload. The bill would also create magistrates to handle small appeals at the third level of appeals; return some appeals to the lower levels of the process when new information is introduced; allow OMHA to expedite appeals with no disputed facts; allow for sampling and extrapolation to consolidate appeals; give OMHA the power to refer fraud to CMS and law enforcement; and set up a study on CMS and contractor participation in appeals hearings, among other provisions. Some policies included in the bill are similar to those in the Administration’s most recent proposed budget, although the bill doesn’t contain other of the president’s proposals, such as refundable filing fees, over which beneficiary and other advocates had raised concerns. The Congressional Budget Office estimated the bill will cost about $1.3 billion over 10 years.