Industry Content   /   September 2019

What’s Going On In Washington

What’s Going On In Washington

Congress is back in session, and that means news for the healthcare industry. With the two halves of Congress divided between Democrats and Republicans, major healthcare legislation is unlikely to pass any time soon. However, that doesn’t mean that there won’t be important developments out of Washington.

As Congress resumes, there are several news stories to keep an eye on.

Congress to debate surprise medical billing

Recently, the issue of surprise medical billing has emerged as a policy issue. Many patients have experienced receiving higher than anticipated bills because they were treated by an out-of-network provider. This is a particularly salient issue for ground ambulance services. 51% of ambulance bills are out-of-network, while 19% of emergency room bills are out-of-network.

In June, the House Energy and Commerce Committee passed legislation that addresses the issue. This legislative package establishes a benchmark rate for out-of-network charges. It also sets up a procedure for healthcare providers and insurers to move towards arbitration in the event of disputes. The Senate Health, Education, Labor and Pensions (HELP) Committee also passed legislation that establishes a benchmark rate. So far, neither bill has been voted on by the full House or Senate. 

The proposed legislation does not address ground ambulance billing because that is overseen by state and local governments. However, if passed it would significantly impact billing for emergency services.

Several industry groups have launched campaigns to oppose this legislation, so it’s possible that it will not pass. While the bills currently have some bipartisan support, many ads are targeting Republican Senators. It is also possible that some Democrats will oppose it because of opposition to President Donald Trump.

Although passage of the bill is far from certain, payers should be alert to the potential changes.

CMS has new powers to go after fraudulent payers

Starting on November 4, CMS will have new powers to go after fraudulent health plans that claim to be affiliated with Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP). CMS will have the power to grant or deny any organization the opportunity to participate in these programs. The new rule is the result of an executive order from the Trump administration.

Under the new regulations, CMS may revoke a group’s right to participate if they are found to have significant fraud or waste. If an organization tries to participate under a new name, they may be revoked as well. Organizations may re-enroll after a full ten years. This is a significant change from previous policy, which had a penalty of only three years.

CMS estimates that it will save $20.7 billion over the next five years. 

Pelosi and Trump try to work out prescription drug price deal

Speaker of the House, Nancy Pelosi plans to release a new prescription drug pricing plan shortly after Congress resumes. It is expected that Pelosi’s plan will direct the federal government to negotiate with pharmaceutical companies on the prices of certain highly expensive prescription drugs. These prices would then become instituted for both private insurance plans and Medicare plans.

In the past, Trump has signaled support for similar policies. He may wish to achieve a political victory ahead of his re-election campaign in 2020. However, the political atmosphere is as such that it’s not likely for such a bill to pass easily. The pharmaceutical industry is likely to put pressure on Congress, especially Republicans, to oppose such a plan.

While new legislation is far from a sure thing, such legislation has the potential to impact prescription drug prices significantly.

Status of Health Insurance Tax (HIT) in 2020 remains uncertain

Section 9010 of the Affordable Healthcare Act (ACA) imposed a tax on the health insurance industry. Organizations that offer individual plans, group plans, or public program plans must pay a fee in proportion to their market share. The tax was suspended in both 2017 and 2019, although it was in effect in 2018.

The Internal Revenue Service (IRS) recently stated that health insurance companies would pay a tax of around $15.5 billion in 2020 if HIT were to be in effect. Congress is considering legislation that would suspend the tax through 2021, but it’s not clear whether it will be passed.

If HIT were to be in effect in 2020, the Medicare Advantage Plan providers would be particularly impacted. Even if HIT is suspended once more, it is possible that some states will impose a tax on health insurers.

Special enrollment period for victims of Hurricane Dorian opens up

CMS recently announced that victims of Hurricane Dorian will be able to enroll in Medicare, Medicaid, and CMS programs during a special open enrollment period. CMS will temporarily be waiving certain requirements for these programs so that people displaced by the hurricane will be able to access healthcare services. Some people will also have the opportunity to enroll in individual health plans through the Federal Health Insurance Exchanges.

People affected by the hurricane will have 60 days from the end of the disaster to make changes to their insurance plan.

CMS to update Medicare Plan Finder Tool

CMS is also planning to improve the Medicare Plan Finder Tool to improve usability. The tool has not been updated for more than ten years. Recently, the Government Accountability Office (GAO) said that the tool is not sufficiently user-friendly.

The new Medicare Plan Finder Tool will make it easier for Medicare enrollees to find appropriate plans for traditional Medicare, Medigap supplemental insurance, Part D plans, and Medicare Advantage plans. A user will be able to enter information about themselves, including prescription drug information, and compare health plans. Some information about drug prices will be available. However, provider network information for Medicare Advantage plans will not be available.

CMS plans to make the tool more mobile-friendly. Once implemented, Medicare enrollees will find it easier to enroll in the plans of their choice.

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