Health Policy Report (10/12)

Capitol Hill Update

House lawmakers will convene for legislative business today eyeing action on a short-term debt limit increase. Late last week, the Senate passed a short-term debt ceiling increase that would provide lawmakers with more time to strike a broader agreement. With less than a week left until the October 18 “X date,” Senate leadership brokered a bipartisan agreement that would hike the debt limit by $480 billion, thus punting the debt limit to December 3 and giving the Treasury Department more wiggle room to avert a default. Despite this brief flash of bipartisan cooperation, the two sides still remain far apart on a long-term solution on the debt ceiling. While the House will also be in for a series of Committee Work Days this week, the Senate has adjourned for a state work period and will resume voting on Monday, October 18.

CMMI Director: Drug Pricing Demos Must Wait for Reconciliation

Last July, the Department of Health and Human Services (HHS) published a drug pricing plan, required by Executive Order, that called for multiple Center for Medicare and Medicaid Innovation (CMMI) demonstrations to control drug prices. On Tuesday, CMMI Director Elizabeth Fowler released a statement claiming that the Center is unable to design payment models to test these proposed drug price controls, however, until after Congress finalizes its plans for drug pricing. Ms. Fowler noted that specific aspects of models that CMMI would consider in terms of Part B are ever-changing, and without more concrete information, the Center is unable to provide an accurate analysis.

Earlier this year, CMS opened a National Coverage Determination analysis — a process that will allow the agency to carefully review and determine whether Medicare will establish a national Medicare coverage policy for the treatment of Alzheimer’s disease. It was rumored that CMS would use CMMI to complete this task, though Fowler noted that CMMI is unable to design demonstrations for Aduhelm, an Alzheimer’s drug, until CMS determines a national Medicare coverage policy for the medication. Ms. Fowler clarified that CMMI is not involved in that national coverage policy and noted the administration’s intent to keep CMMI and the coverage policy work separate from one another.

CMS Prioritizes Equity Over Reducing Provider Burden

Under the Trump administration, CMS set a goal to make all quality measure reporting digital by 2030. At its 2021 Quality Conference in March, CMS announced that it was moving that goal date up to 2025. However, CMS is now prioritizing quality measures that advance equity over those that reduce burden, CMS Chief Medical Officer Lee Fleisher indicated recently. Additionally, Mr. Fleisher noted that the Biden administration is prioritizing the curation of “the right” quality metrics, rather than carrying on the previous administration’s priority of reducing provider burden. Mr. Fleisher went on to express that, while CMS intends to make quality measures digital to the fullest extent possible, the administration is open to adopting structural or process measures if equity is diminished in the pursuit of a fully digital landscape. 

GAO Releases Report on MIPS Provider Performance

On Wednesday, the U.S. Government Accountability Office (GAO) published a report on provider performance and experiences under the Merit-based Incentive Payment System (MIPS). The report details MIPS performance and resulting payment adjustments, as well as stakeholder feedback on the program. Overall, GAO found that the MIPS scores were high, with roughly 93 percent of providers obtaining a small, positive adjustment from 2017 to 2019. The largest adjustment in any year was 1.88 percent, and median scores cleared the performance threshold by wide margins according to the report. Roughly 72 to 84 percent of providers exceeded the exceptional performance measure, earning them an additional bonus. No more than 4.8 percent of providers qualified for a negative adjustment.

The Centers for Medicare and Medicaid Services (CMS) administers MIPS as a mechanism to determine future Medicare payment adjustments for providers. The program originated in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) as an attempt to move toward higher quality, more efficient care through the Quality Payment Program (QPP). Providers participating in the MIPS program are scored based on measures that fall into four categories: (1) cost; (2) quality; (3) improvement activities; and (4) promoting interoperability. MIPS includes a wide range of providers, though providers participating in an Advanced alternative payment model (APM) and those serving a low volume of Medicare beneficiaries are excluded from the model. A provider’s final score is compared to a performance threshold and informs CMS if the provider should receive a positive, negative, or neutral change in their payment rates. Providers can also receive a payment adjustment boost if their MIPS score passes the exceptional performance threshold. According to GAO, roughly 950 thousand providers, or about half of Medicare Part B providers, were MIPS-eligible in 2019. Payment adjustments as determined in any given year take effect two years later.

GAO also interviewed several stakeholders to learn their perspectives on the strengths and challenges of the MIPS program. Eleven stakeholders generally supported the program, and two respondents noted that bonuses help to increase scores for smaller provider practices that may otherwise be disadvantaged by the scoring system. However, eight stakeholders questioned if MIPS leads to improved health outcomes. Specifically, they noted that providers may choose to report on their strongest quality measures instead of areas in which the provider needs improvement. CMS assured these stakeholders that the MIPS Value Pathways (MVP) — a new way that providers can meet reporting requirements — will work to remedy these concerns by standardizing performance measurements. Officials said that more cohesive measurements will narrow the provider selection burden to report for each MVP. For 2019 through 2022, MACRA directed CMS to provide an additional $500 million for exceptional performance bonuses. Additionally, the new MVP mechanism will go into effect in 2023.

Analysis Shows High Cost of Extending ACA Credits, Covering Medicaid Gap

The Commonwealth Fund and Urban Institute released a report last month which found that permanently extending Affordable Care Act (ACA) tax credits under the American Rescue Plan (ARP) and allowing those in the Medicaid “coverage gap” to access those subsidies would reduce the number of uninsured by 7 million and cost roughly $333 billion over 10 years. While the brief garnered little public attention at the time of its release, an Urban Institute researcher and report co-author claims that the report has been viewed by key policymakers who are working to craft a reconciliation package likely to include some version of both policies. The reconciliation bill passed by the House contains several Medicaid-related provisions, including: (1) the extension of tax credits to the “coverage gap” population; (2) the requirement that the Centers for Medicare and Medicaid Services (CMS) establish a federally funded Medicaid program by 2025; and (3) the permanent extension of higher ACA tax credits.

The analysis also found that, if both policies were enacted, overall household spending would decrease by $8.2 billion. Specifically, household spending on premiums would be reduced by roughly $8.8 billion in 2022, while out-of-pocket spending on health care services, like co-pays and deductibles, would increase by an estimated $600 million due to increased access and use. Additionally, the report found that uninsured rates would fall in all states, but the largest declines would occur in non-expansion states like Alabama and Mississippi at 44 and 43 percent, respectively. Many expansion states would also see decreases in their uninsured rates — West Virginia’s uninsured population would see a decrease of about 28 percent and Nevada would see a decline of about 18 percent. Reductions would also be concentrated in lowest income populations, and all racial and ethnic groups would gain coverage under the policies, the brief found.