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MedPAC Considers Draft Recommendations Addressing Nursing Homes, Drug Benefit, Primary Care

August 18, 2017

The Medicare Payment Advisory Commission during a recent meeting considered several draft recommendations to Congress regarding skilled nursing facilities, prescription drug plans and primary care, CQ HealthBeat reports.

One draft recommendation for revising the prospective Medicare payment system for skilled nursing facilities would add a "separate nontherapy ancillary component," which includes prescription drugs and intravenous therapy. The recommendation also would base payments for the therapy component on "predicted patient care needs" and implement "outlier payments" for unusual financial losses. Another draft recommendation for skilled nursing facility payments would have the HHS secretary require facilities to report diagnosis information, dates of services on claims filed and "services they furnish separately" on patient assessments. In addition, facilities with the highest profits would receive the largest payment cuts, while those losing money would receive the largest increases.

The American Association of Homes and Services for the Aging in a statement said that under the proposed system, "Medicare payments would shift and -- among other things -- recognize the higher costs not-for-profit nursing homes face."

The commission also discussed draft recommendations for revising the Medicare prescription drug benefit. One proposal would require HHS to create a measure for access that "calculates whether beneficiaries get a prescribed drug or its alternatives without undue delay." Another proposal would have the HHS secretary "require plans to transmit information to pharmacies when they reject a prescription, stating why the drug is not covered and if the plan covers a clinical alternative."

Draft recommendations for addressing the national shortage of primary care physicians include increasing "the payment for a primary care service if a practitioner designated by the (HHS) secretary as a primary care practitioner furnishes the service." Another recommendation would promote the establishment of "medical homes" by issuing per-beneficiary payments to doctors who provide coordinated care. The proposal includes establishing a medical home pilot program in Medicare.

MedPAC Chair Glenn Hackbarth said that the recommendations could be changed and that the commission might consider them next month for inclusion in the panel's June report to Congress (Reichard [1], CQ HealthBeat, 3/7).

Hospice Spending
Medicare spending on hospice care tripled between 2000 and 2007 and currently totals about $10 billion annually, according to a presentation Thursday by MedPAC staffer James Mathews. The length of stays for hospice care increased on average by 30% from 2000 to 2005, and although some of the increase is attributable to changes in the diagnoses of patients using hospice care, some facilities have longer stays for all patients and diagnoses, according to the presentation.

MedPAC Commissioner William Scanlon proposed shifting payments from the most profitable centers to the least profitable, but Hackbarth said, "I'm going to refrain from endorsing [Scanlon's] idea at least until he comes up with a better marketing plan."

Other proposals to address increasing spending include adjusting hospice care payments to decline with the length of stays and creating incentives for short stays. However, Mathews noted that the data CMS currently collects does not indicate the length of individual hospice stays (Reichard [2], CQ HealthBeat, 3/7).

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