President Outlines Healthcare Spending Priorities, Sets Parameters of Debate. Many observers in Washington this week expected President Barack Obama to closely align his plans for healthcare spending over the next decade with recommendations made by his Debt Commission last December. Of the half-dozen healthcare spending recommendations put forth by the Debt Commission in their report, “ Moment of Truth,” President Obama included two-thirds of them in his plan to save $480 billion over the next 12 years. Specifically, the President called for reforming the Medicare physician payment system and Medicaid matching rate system (setting the formula at a single rate for all program spending); increasing enforcement powers for the Independent Payment Advisory Board and setting the payment-cutting trigger at GDP per capita plus 0.5 percent. He has also proposed that the National Governors Association create a commission to develop a Medicaid reform plan that would provide more flexibility without resorting to block grant payments. This announcement has set the Democrats’ side of the chessboard after House Budget Chairman Rep. Ryan (R-WI) released his plans last week to make Medicare a voucher-based program while providing states with block grants for Medicaid.

Patient Safety Initiative Launched. Another component of President Obama’s plan to achieve savings in healthcare was spotlighted this week with the unveiling of a new patient safety initiative, The Partnership for Patients. During an announcement Monday, Department of Health and Human Services (HHS) Secretary Kathleen Sebelius and Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Donald Berwick said the Partnership for Patients would seek to reduce preventable injuries by 40 percent and cut preventable readmission by 20 percent by 2013. Achieving these goals has the potential to save up to $35 billion dollars across the healthcare system, including up to $10 billion in Medicare savings, over the next three years, a White House fact sheet said. Secretary Sebelius indicated HHS would invest up to $1 billion in federal funding, ($500 million through the Community-Based Care Transitions Program and up to $500 million dedicated from the Centers for Medicare & Medicaid Services (CMS) Innovation Center to support new demonstrations related to reducing hospital-acquired conditions). According to a draft document, leaked in January, other possible levers for CMS include tying hospital payments to public reporting of errors and provisions of safer care.

Given that adverse events are not restricted to the in-patient setting, The Partnership for Patients includes a component on care transitions. For example, one in five patients discharged from the hospital to home experience an adverse event within three weeks of discharge. The Medicare Community-Based Care Transitions Program creates a funding source for care transition services aimed at managing transitions from acute to community-based settings. Eligible entities will be paid on a per-eligible-discharge basis for eligible Medicare beneficiaries at high risk for readmission, including those with multiple chronic conditions, depression, or cognitive impairments. To date, 500 hospitals, more than 30 employer groups and several major physicians groups have signed up to participate in the partnership initiative.

Attestation Kicks Off Monday. Monday, April 18 marks the launch of the Medicare and Medicaid EHR Incentive Program attestation process in which eligible professionals, eligible hospitals and critical access hospitals that demonstrate meaningful use of certified electronic health record (EHR) technology can apply for incentive payments. If eligible professionals and eligible hospitals have not previously registered for the program, they may also do so at this time. A preview document released earlier this week includes attestation screenshots on examples of the process. CMS will release additional information about the attestation process soon with user guides that will give step-by-step instructions for completing attestation and educational webinars that describe the attestation process in depth. For the Medicaid EHR Incentive Program, providers will follow a similar process using their state's attestation system.