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Washington Debrief: CMS Plans to Link MU, Quality Data to Medicare Reimbursement

May 5, 2014
by Jeff Smith, Director of Public Policy at CHIME
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Jeff Smith, Director of Public Policy at CHIME

Government Signals New ICD-10 Deadline, Hospital Payment Updates

Key Takeaway: Last week, the Centers for Medicare & Medicaid Services (CMS) announced their intentions to set Oct. 1, 2015, as the new deadline for transitioning to ICD-10. The agency also proposed hospitals payment updates for 2015 that are subject to Meaningful Use status and quality measure submission for the Hospital Inpatient Quality Reporting (IQR) Program.

Why it Matters: By tying hospital reimbursement to participation in Meaningful Use, the federal government is taking another significant step in healthcare payment and delivery reform. The proposal solidifies a permanent role for the Meaningful Use program beyond the period of incentive payments, and it further binds quality reporting for IQR and MU.

Last week, CMS officials released an annual update to hospital reimbursement through the Inpatient Prospective Payment System. While the proposed rule would increase payments to inpatient hospitals, aggregate payments (operating and capital) are expected to drop $241 million in 2015. Included in the update were new provisions that further ingrain Meaningful Use status as a key indicator for payment bonuses and penalties in 2015 and beyond.

The proposed rule would give hospitals the opportunity to receive as much as a 2.1 percent payment increase if they submit quality data for IQR and are successful Meaningful Use participants. For hospitals that submit IQR data, but fail to meet Meaningful Use requirements in 2015, a payment increase of 1.425 percent is possible. And hospitals that neither submit quality data nor meet MU requirements would receive a 0.75 percent increase.

The rule also referenced ICD-10 codes and specifically mentioned Oct. 1, 2015, as a deadline; however, the rule did not official propose such a change to the ICD-10 date. After period of brief confusion, during which several news outlets and associations erroneously reported the date change, CMS officials issued a statement outlining their intentions to make Oct. 1, 2015, the official new date through an upcoming “interim final rule.” CIOs and other health IT stakeholders can consider the new ICD-10 date as Oct. 1, 2015, for planning purposes, but stakeholders should be mindful of how quickly things can change in Washington, D.C.

Health IT Policy Committee Welcomes Three New Members

Key Takeaway: Three new members of the Health IT Policy Committee were announced; they will represent vendors, vulnerable populations and healthcare “consumers.”

Why It Matters: The Office for the National Coordinator of Health IT (ONC) is reorienting both the Health IT Policy Committee and Standards Committee to focus on a range of activities, including patient safety, EHR certification and standards-based exchange. These and subsequent appointees should be expected to inform policymaking by incorporating their fresh points of view with lessons learned from the last five years of Committee work. Last week federal officials announced three new appointments to the Health IT Policy Committee. Christoph Lehmann, from Vanderbilt University; Neal Patterson, CEO of Cerner; and Kim Schofield, a health educator from Georgia, will represent underserved populations, vendors and consumers, respectively. The work facing the HIT Policy Committee and the Standards Committee will be focused on broad issues, including:

  • Advanced health models and meaningful use
  • HIT implementation, usability and safety

Interoperability and health information exchange

House Energy and Commerce Committee Calls for Input on Telemedicine

Key Takeaway: Last week at a House Energy and Commerce Committee hearing called “Telehealth to Digital Medicine: How 21st Century Technology Can Benefit Patients,” a bipartisan group of Representatives supported increasing access to care by improving telemedicine policies.

Why it Matters: Many Representatives at the hearing focused on licensure and reimbursement as main barriers to practicing telemedicine and emphasized the opportunity to lower healthcare costs and achieve better outcomes through the appropriate use of telemedicine.