Finance
Dr. Fred Cerise of Parkland and THOT provides testimony on hospital finance and the 1115 Waiver to the Texas House Appropriations Committee on behalf of THOT. July 13, 2016
Pass-Through Payments
One option for new Medicaid funding opened up with CMS’ recently published Medicaid managed care rules. THOT’s June Board meeting focused on the new rules and options with input from Barbara Eyman and Bill Rago. A vehicle referred to as transitional pass-through payments allow states to direct HMOs to make certain payments to providers over the course of a 5 (for nursing facilities) to 10-year (for hospitals) period. The rule language as published did not limit these payments to existing funds. Several Texas provider groups submitted proposals for HHSC’s submission to CMS, to use the new authority to increase provider rates. On July 29th, CMS published an Informational Bulletin in which CMS Director for Medicaid and CHIP Services, Vicki Wachino, indicates CMS will not approve new pass through payments. Creating new payments, she argues, “would exacerbate a problematic practice that is inconsistent with statutory and regulatory requirements, complicates the required transition of pass-through payments to permissible provider payment models and reduced managed care plans’ ability to effectively use value-based purchasing strategies and implement provider-based quality initiatives.” The bulletin also notes that CMS will have “future rulemaking” that will limit pass through payments to those already in place as of July 5, 2016. Per THOT conversations with Barbara Eyman, CMS will need to explicitly prohibit new pass through payments in rule since bulletins can’t trump rules. In any event, CMS will be unlikely to approve any of the new pass through payment proposals.
Quarterly Quality Meeting with HHSC
THOT attended a quarterly meeting on quality initiatives with HHSC and various other hospital associations. 3M joined the meeting via phone to discuss their program design that evaluates potentially preventable complications (PPC), potentially preventable readmission (PPR), and present on admission quality checks. 3M noted that updates to their system take place annually and are timed with I-10 coding refreshes. The updates take place around February and March, and HHSC will allow the hospital associations to review the logic behind the updates and take part in a discussion prior to their implementation. 3M and HHSC also offered to conduct a webinar for hospital association members if there are specific questions or topics of interest.
The hospital associations shared concerns about some of the conditions that were being rolled into the penalty schedule, and HHSC and 3M noted that they were open to reviewing the data and discussing ways the system can be improved. HHSC also mentioned that they were open to discussions on narrowing the list of PPCs if the data and research warranted it. HHSC provided 2014 potentially preventable events data by hospital type, and plans to run additional data stratifying birthing complications to determine if there are any issues.
Lastly, HHSC provided the group with an update on the Safety-Net Add On which is set to be paid out at the end of this fiscal year or beginning of FY 2017. HHSC is basing the payments on FY 14 data for FY 16, and has a list of 32 hospitals that will receive their allocation as a fee for service, the rest of the facilities will get their payments through the MCOs once the capitation rates are updated in March. HHSC anticipates the payments will be retroactive, and they will try and push out FY 16 and FY 17 payments at the same time. HHSC and the hospital associations have another quality meeting scheduled in October.
