Medicare Telehealth Improvement Act of 2008

Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 70) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits. S 3101, and HR 6331, the Medicare Improvements for Patients and Providers Act of 2008. Supported provisions that prevent the 10.6% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.6% cut with an increase through 2008, and extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 through 2008. S.2812, the Medicare Improvement Act of 2008 introduced by senator Kent Conrad. This legislation will expand the number of originating sites, the list of eligible practitioners, and provide an advisory committee to CMS and Congress on payment issues related to services provided via TeleHealth. The Physician Payment Sunshine Act, S. 2029, introduced by Senator Kohl with Senator Grassley to create accountability among physicians and the manufacturers of drugs and devices that physicians utilize and prescribe for their patients. This legislation would require manufacturers of pharmaceutical drugs, medical devices, and biologics to disclose the amount of money they give to doctors through payments, gifts, honoraria, travel and other means. The Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Grassley to mitigate current inequities in Medicare reimbursement, improve access to health services in rural and underserved areas, and will begin to close the gap between Medicare reimbursement and the cost of providing services in predominantly rural areas. The legislation establishes a 1.0 floor for physician work and practice expense adjustments. It also revises the work and practice expense formulas to reduce payment differences and more accurately compensate physicians in rural areas for their true practice costs. The bill also extends the five percent incentive payments for primary care and specialty physicians in scarcity areas. Marshfield Clinic nominated Dr. Douglas Reding for an open position on the Medicare Payment Advisory Commission, and sought the endorsement of the Wisconsin delegation, and other Senators and Representatives that serve on the Committees with jurisdiction over the Medicare program. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Pay-for Reporting and Performance (Value Based Purchasing) Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. HR 6357, the Protecting Records, Optimizing Treatment and Easing Communications through Health Care Technology Act of 2008 is important legislation that promotes Health Information Technology and the protection of patients personal health information. HR 6357 codifies ONCHIT, provides grants and loans for HIT, but most importantly the bill creates new privacy and security provisions which require notification of breaches of PHI by covered entities and business associates. The bill also includes restrictions on certain disclosures of PHI allowing patients to request that their information not be released to health plans in certain circumstances. It also includes an impractical consent provision that requires additional patient consent if the PHI is utilized in operations, such as peer review, quality review, standard of care review, malpractice review, or best practices analysis. HR 6898 Health-e Information Technology Act of 2008, a bill that includes an estimated $4 billion in incentive payments to Medicare physicians and hospitals which demonstrate successful adoption and use of HIT once initial national technical standards are finalized. Support for privacy enforcement provisions. H.R.6179 the Promoting Health Information Technology Act of 2008 - provisions that encourage and facilitate the adoption of state reciprocity agreements for practitioner licensure in order to expedite the provision across state lines of telehealth services; and provisions that require the Centers of Medicare & Medicaid Services to make federally qualified health centers eligible to participate in demonstration projects related to health records and heath information technology. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. Support for Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Chuck Grassley especially provisions that would extend the 1.0 work floor through December 31,2009, and would recognize the equality of physician work in all geographic areas and eliminate differing work index values by establishing a national value of 1.0, effective 2010. Also support provisions for physician practice expense that would establish a practice expense floor of 1.0 for 2009 by requiring the Secretary to increase the value of any practice expense geographic index that was below 1.0 to 1.0 for services furnished on or after January 1, 2009 and before January 1, 2010. Subsection (b) would reduce the geographic adjustment for practice expense to 50 percent of the current adjustment for employee wages and rent, effective 2010. Support for Rep. Ron Kinds concept of a not yet introduced MEDICARE EFFICIENCY BILL that would amend the CHAMP Act (H.R. 3162) 304 in whole, by establishing that the 5% bonus payment would be expanded to the top 10% of efficient counties; and a corresponding 5% efficiency penalty for physicians in the bottom 10% of efficient counties. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Also supports efforts to eliminate the 2% threshold for payments and the 5% limitation on payments. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building".

Client expense: $100,000 · Firm income: Not reported

Government targets: Agency for Healthcare Research & Quality (AHRQ), Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, Health & Human Services, Dept of (HHS), Medicare Payment Advisory Commission (MedPAC), Natl Institutes of Health (NIH), SENATE

Removing barriers to use of health information technology in the long-term care setting [Wired for Health Care Quality Act (S. 1693) -- all provisions; Medicare Telehealth Improvement Act (S. 2812) -- all provisions; Medicare Electronic Medication and Safety Protection (E-MEDS) Act (S. 2408, H.R. 4296) -- all provisions; Protecting Records, Optimizing Treatment, and Easing Communication through Healthcare Technology Act (H.R. 6357) -- all provisions]

Client expense: Not reported · Firm income: $30,000

Government targets: Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, Health & Human Services, Dept of (HHS), SENATE

S. 2812 - Medicare Health Improvement Act of 2008

Client expense: Not reported · Firm income: Not reported

Government targets: HOUSE OF REPRESENTATIVES, SENATE

HR 748 - Medicare Access to Rehabilitation Services Act, Repeal of Therapy Caps S 450 - Medicare Access to Rehabilitation Services Act, Repeal of Therapy Caps HR 1552 - Medicare Patient Access to Physical Therapists Act S 932 - Medicare Patient Access to Physical Therapists Act HR 1846 - Medicare Access to Physical Medicine and Rehabilitation Services Improvement Act of 2007 HR 5445 - To amend part B of title XVIII of the Social Security Act to increase Medicare payments for physicians' services through December 31, 2009 S 2785 - Save Medicare Act of 2008 S 2460 - To extend by one year the moratorium on implementation of a rule relating to the Federal-State financial partnership under Medicaid and the State Children's Health Insurance Program. S 787 - To impose a 2-year moratorium on implementation of a proposed rule relating to the Federal-State financial partnerships under Medicaid and the State Children's Health Insurance Program HR 5590 - Medicare Oral Health Rehabilitative Enhancement Act of 2008 HR 5613 - Protecting Medicaid Safety Net Act of 2008 HR 4105 - Medicare Recovery Audit Contractor Program Moratorium Act of 2007 H CON RES 312 - Revising the congressional budget for the United States Government for fiscal year 2008, establishing the congressional budget for the United States Government for fiscal year 2009, and setting forth appropriate budgetary levels for fiscal years 2010 through 2013 HR 1459 - To improve Medicare beneficiary access by extending the 60 percent compliance threshold used to determine whether a hospital or unit of a hospital is an inpatient rehabilitation facility S 1958 - Medicare Long-Term Care Hospital Patient Safety and Improvement Act of 2007 HR 3057 - Medicare Long-Term Care Patient Safety and Improvement Act of 2007 CORF, ORF conditions of participation- social and vocational services requirements Medicaid regulations promulgated by CMS Stark provisions in Fee Schedule Rule Physician Quality Reporting Initiative Durable Medical Equipment, Prosthetic, Orthotic & Supplies (DMEPOS) Regulations Medicare Post Acute Care Demo Medicare Home Health Demo Medicare Electronic Health Record demo CMS Alternative Payment System Project Comments to American Health Information Community re: successor Payment updates for physicians, hospitals, skilled nursing facilities, and home health Medicare Manual revisions In office ancillary services exception Inpatient Rehabilitation Facilities under Medicare Improving Funding for the Medicaid Program Extending legislative moratoria on Medicaid Regulations in President's FY 2009 budget Working with plan to mandate implementation of the International Classification of Diseases, 10th edition Medicaid Federal Medical Assistance Percentage (FMAP) 2009 Medicare Physician Fee Schedule Proposed Rule HR 6331-the Medicare Improvements for Patients and Providers Act S 3101- the Medicare Improvements for Patients and Providers Act S 3118 - Preserving Access to Medicare Act of 2008 HR 6252 - Medicare DMEPOS Competive Acquisition Reform Act of 2008 S 3144- Medicare DMEPOS Competive Acquisition Reform Act of 2008 HR 4105 - Medicare Recovery Audit Contractor Program S 2812 - Medicare Telehealth Improvement Act of 2008 HR 5445 - Increase Medicare Payments for physician services S 2785 - Increase Medicare Payments for physician services HR 5704 - Home Health Flexibility Act of 2008 Outpatient Hospital Medicaid Regulations

Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 70) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits. S 3101, and HR 6331, the Medicare Improvements for Patients and Providers Act of 2008. Supported provisions that prevent the 10.6% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.6% cut with an increase through 2008, and extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 through 2008. S.2812, the Medicare Improvement Act of 2008 introduced by senator Kent Conrad. This legislation will expand the number of originating sites, the list of eligible practitioners, and provide an advisory committee to CMS and Congress on payment issues related to services provided via TeleHealth. The Physician Payment Sunshine Act, S. 2029, introduced by Senator Kohl with Senator Grassley to create accountability among physicians and the manufacturers of drugs and devices that physicians utilize and prescribe for their patients. This legislation would require manufacturers of pharmaceutical drugs, medical devices, and biologics to disclose the amount of money they give to doctors through payments, gifts, honoraria, travel and other means. The Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Grassley to mitigate current inequities in Medicare reimbursement, improve access to health services in rural and underserved areas, and will begin to close the gap between Medicare reimbursement and the cost of providing services in predominantly rural areas. The legislation establishes a 1.0 floor for physician work and practice expense adjustments. It also revises the work and practice expense formulas to reduce payment differences and more accurately compensate physicians in rural areas for their true practice costs. The bill also extends the five percent incentive payments for primary care and specialty physicians in scarcity areas. Marshfield Clinic nominated Dr. Douglas Reding for an open position on the Medicare Payment Advisory Commission, and sought the endorsement of the Wisconsin delegation, and other Senators and Representatives that serve on the Committees with jurisdiction over the Medicare program. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Support for S.2785, the Save Medicare Access Act of 2008, introduced by Sen. Debbie Stabenow. It would avert the 10.6% cut to physician payments scheduled to take effect in July and the additional cut of 5% or more scheduled in January 09. Payments would continue at their current rate through the remainder of 2008 and then would rise by 1.8% in 2009. The current work GPCI floor and physician scarcity bonus would also be continued through the end of 2009. Pay-for Reporting and Performance Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. HR 6357, the Protecting Records, Optimizing Treatment and Easing Communications through Health Care Technology Act of 2008 is important legislation that promotes Health Information Technology and the protection of patients personal health information. HR 6357 codifies ONCHIT, provides grants and loans for HIT, but most importantly the bill creates new privacy and security provisions which require notification of breaches of PHI by covered entities and business associates. The bill also includes restrictions on certain disclosures of PHI allowing patients to request that their information not be released to health plans in certain circumstances. It also includes an impractical consent provision that requires additional patient consent if the PHI is utilized in operations, such as peer review, quality review, standard of care review, malpractice review, or best practices analysis. HR 6898 Health-e Information Technology Act of 2008, a bill that includes an estimated $4 billion in incentive payments to Medicare physicians and hospitals which demonstrate successful adoption and use of HIT once initial national technical standards are finalized. Support for privacy enforcement provisions. H.R.6179 the Promoting Health Information Technology Act of 2008 - provisions that encourage and facilitate the adoption of state reciprocity agreements for practitioner licensure in order to expedite the provision across state lines of telehealth services; and provisions that require the Centers of Medicare & Medicaid Services to make federally qualified health centers eligible to participate in demonstration projects related to health records and heath information technology. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. Support for Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Chuck Grassley especially provisions that would extend the 1.0 work floor through December 31,2009, and would recognize the equality of physician work in all geographic areas and eliminate differing work index values by establishing a national value of 1.0, effective 2010. Also support provisions for physician practice expense that would establish a practice expense floor of 1.0 for 2009 by requiring the Secretary to increase the value of any practice expense geographic index that was below 1.0 to 1.0 for services furnished on or after January 1, 2009 and before January 1, 2010. Subsection (b) would reduce the geographic adjustment for practice expense to 50 percent of the current adjustment for employee wages and rent, effective 2010. Support for Rep. Ron Kinds concept of a not yet introduced MEDICARE EFFICIENCY BILL that would amend the CHAMP Act (H.R. 3162) 304 in whole, by establishing that the 5% bonus payment would be expanded to the top 10% of efficient counties; and a corresponding 5% efficiency penalty for physicians in the bottom 10% of efficient counties. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Also supports efforts to eliminate the 2% threshold for payments and the 5% limitation on payments. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building".

H.R. 6163; S. 2812 - Medicare Telehealth Improvement Act of 2008.

Client expense: $70,000 · Firm income: Not reported

Government targets: HOUSE OF REPRESENTATIVES, SENATE

The Telehealth Improvement Act of 2008, S. 2812.

Client expense: Not reported · Firm income: $10,000

Government targets: HOUSE OF REPRESENTATIVES, SENATE

Removing barriers to use of health information technology in the long-term care setting [Wired for Health Care Quality Act (S. 1693) -- all provisions; Medicare Telehealth Improvement Act (S. 2812) -- all provisions; Medicare Electronic Medication and Safety Protection (E-MEDS) Act (S. 2408, H.R. 4296) -- all provisions; Protecting Records, Optimizing Treatment, and Easing Communication through Healthcare Technology Act (H.R. 6357) -- all provisions]

Client expense: Not reported · Firm income: $30,000

Government targets: Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, Health & Human Services, Dept of (HHS), SENATE

The Telehealth Improvement Act of 2008, S. 2812.

Client expense: Not reported · Firm income: $10,000

Government targets: HOUSE OF REPRESENTATIVES, SENATE

HR 748 - Medicare Access to Rehabilitation Services Act, Repeal of Therapy Caps S 450 - Medicare Access to Rehabilitation Services Act, Repeal of Therapy Caps HR 1552 - Medicare Patient Access to Physical Therapists Act S 932 - Medicare Patient Access to Physical Therapists Act HR 1846 - Medicare Access to Physical Medicine and Rehabilitation Services Improvement Act of 2007 HR 5445 - To amend part B of title XVIII of the Social Security Act to increase Medicare payments for physicians' services through December 31, 2009 S 2785 - Save Medicare Act of 2008 S 2460 - To extend by one year the moratorium on implementation of a rule relating to the Federal-State financial partnership under Medicaid and the State Children's Health Insurance Program. S 787 - To impose a 2-year moratorium on implementation of a proposed rule relating to the Federal-State financial partnerships under Medicaid and the State Children's Health Insurance Program HR 5590 - Medicare Oral Health Rehabilitative Enhancement Act of 2008 HR 5613 - Protecting Medicaid Safety Net Act of 2008 HR 4105 - Medicare Recovery Audit Contractor Program Moratorium Act of 2007 H CON RES 312 - Revising the congressional budget for the United States Government for fiscal year 2008, establishing the congressional budget for the United States Government for fiscal year 2009, and setting forth appropriate budgetary levels for fiscal years 2010 through 2013 HR 1459 - To improve Medicare beneficiary access by extending the 60 percent compliance threshold used to determine whether a hospital or unit of a hospital is an inpatient rehabilitation facility S 1958 - Medicare Long-Term Care Hospital Patient Safety and Improvement Act of 2007 HR 3057 - Medicare Long-Term Care Patient Safety and Improvement Act of 2007 CORF, ORF conditions of participation- social and vocational services requirements Medicaid regulations promulgated by CMS Stark provisions in Fee Schedule Rule Physician Quality Reporting Initiative Durable Medical Equipment, Prosthetic, Orthotic & Supplies (DMEPOS) Regulations Medicare Post Acute Care Demo Medicare Home Health Demo Medicare Electronic Health Record demo CMS Alternative Payment System Project Comments to American Health Information Community re: successor Payment updates for physicians, hospitals, skilled nursing facilities, and home health Medicare Manual revisions In office ancillary services exception Inpatient Rehabilitation Facilities under Medicare Improving Funding for the Medicaid Program Extending legislative moratoria on Medicaid Regulations in President's FY 2009 budget Working with plan to mandate implementation of the International Classification of Diseases, 10th edition Medicaid Federal Medical Assistance Percentage (FMAP) 2009 Medicare Physician Fee Schedule Proposed Rule HR 6331-the Medicare Improvements for Patients and Providers Act S 3101- the Medicare Improvements for Patients and Providers Act S 3118 - Preserving Access to Medicare Act of 2008 HR 6252 - Medicare DMEPOS Competive Acquisition Reform Act of 2008 S 3144- Medicare DMEPOS Competive Acquisition Reform Act of 2008 HR 4105 - Medicare Recovery Audit Contractor Program S 2812 - Meciare Telehealth Improvement Act of 2008 HR 5445 - Increase Medicare Payments for physician services S 2785 - Increase Medicare Payments for physician services

Medicare Reform S3101/HR6361 Health IT S1693/HR6357 Telehealth S2812 CAST Commission S908

Client expense: $500,000 · Firm income: Not reported

Government targets: Commerce, Dept of (DOC), Environmental Protection Agency (EPA), Federal Communications Commission (FCC), HOUSE OF REPRESENTATIVES, Health & Human Services, Dept of (HHS), Natl Security Agency (NSA), SENATE, State, Dept of (DOS), U.S. Customs & Border Protection, U.S. International Trade Commission (ITC), U.S. Trade Representative (USTR)

Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 70) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits. S 3101, and HR 6331, the Medicare Improvements for Patients and Providers Act of 2008. Supported provisions that prevent the 10.6% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.6% cut with an increase through 2008, and extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 through 2008. S.2812, the Medicare Improvement Act of 2008 introduced by senator Kent Conrad. This legislation will expand the number of originating sites, the list of eligible practitioners, and provide an advisory committee to CMS and Congress on payment issues related to services provided via TeleHealth. The Physician Payment Sunshine Act, S. 2029, introduced by Senator Kohl with Senator Grassley to create accountability among physicians and the manufacturers of drugs and devices that physicians utilize and prescribe for their patients. This legislation would require manufacturers of pharmaceutical drugs, medical devices, and biologics to disclose the amount of money they give to doctors through payments, gifts, honoraria, travel and other means. The Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Grassley to mitigate current inequities in Medicare reimbursement, improve access to health services in rural and underserved areas, and will begin to close the gap between Medicare reimbursement and the cost of providing services in predominantly rural areas. The legislation establishes a 1.0 floor for physician work and practice expense adjustments. It also revises the work and practice expense formulas to reduce payment differences and more accurately compensate physicians in rural areas for their true practice costs. The bill also extends the five percent incentive payments for primary care and specialty physicians in scarcity areas. Marshfield Clinic nominated Dr. Douglas Reding for an open position on the Medicare Payment Advisory Commission, and sought the endorsement of the Wisconsin delegation, and other Senators and Representatives that serve on the Committees with jurisdiction over the Medicare program. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Support for S.2785, the Save Medicare Access Act of 2008, introduced by Sen. Debbie Stabenow. It would avert the 10.6% cut to physician payments scheduled to take effect in July and the additional cut of 5% or more scheduled in January 09. Payments would continue at their current rate through the remainder of 2008 and then would rise by 1.8% in 2009. The current work GPCI floor and physician scarcity bonus would also be continued through the end of 2009. Pay-for Reporting and Performance Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. HR 6357, the Protecting Records, Optimizing Treatment and Easing Communications through Health Care Technology Act of 2008 is important legislation that promotes Health Information Technology and the protection of patients personal health information. HR 6357 codifies ONCHIT, provides grants and loans for HIT, but most importantly the bill creates new privacy and security provisions which require notification of breaches of PHI by covered entities and business associates. The bill also includes restrictions on certain disclosures of PHI allowing patients to request that their information not be released to health plans in certain circumstances. It also includes an impractical consent provision that requires additional patient consent if the PHI is utilized in operations, such as peer review, quality review, standard of care review, malpractice review, or best practices analysis. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. Support for Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Chuck Grassley especially provisions that would extend the 1.0 work floor through December 31,2009, and would recognize the equality of physician work in all geographic areas and eliminate differing work index values by establishing a national value of 1.0, effective 2010. Also support provisions for physician practice expense that would establish a practice expense floor of 1.0 for 2009 by requiring the Secretary to increase the value of any practice expense geographic index that was below 1.0 to 1.0 for services furnished on or after January 1, 2009 and before January 1, 2010. Subsection (b) would reduce the geographic adjustment for practice expense to 50 percent of the current adjustment for employee wages and rent, effective 2010. Support for Rep. Ron Kinds concept of a not yet introduced MEDICARE EFFICIENCY BILL that would amend the CHAMP Act (H.R. 3162) 304 in whole, by establishing that the 5% bonus payment would be expanded to the top 10% of efficient counties; and a corresponding 5% efficiency penalty for physicians in the bottom 10% of efficient counties. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Subtitle C: Other Provisions - (Sec. 626) Provides that in FY 2004, starting April 1, 2004, the ambulatory surgery center (ASC) update will be the Consumer Price Index for all urban consumers (U.S. city average) as estimated as of March 31, 2003, minus 3.0 percentage points. Provides that in FY 2005, the last quarter of calendar year 2005, and each of calendar years 2006 through 2009, the ASC update will be zero percent. Provides that subject to recommendations by the General Accounting Office, the Secretary will implement a revised payment system for payment of surgical services furnished in ASCs. Requires the new system to be implemented so that it is first effective on or after January 1, 2006, and not later than January 1, 2008. (Sec. 628) Provides that there will be no updates to the clinical diagnostic laboratory test fee schedule for 2004 through 2008. Subtitle D: Additional Demonstrations, Studies, and Other Provisions - (Sec. 649) Directs the Secretary to establish a pay-for-performance demonstration program with physicians to meet the needs of eligible beneficiaries through the adoption and use of health information technology and evidence-based outcomes measures Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Also supports efforts to eliminate the 2% threshold for payments and the 5% limitation on payments. Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 H.R.1823 Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 introduced by Rep. Wally Herger and Kendrick Meek - Amends title XVIII (Medicare) of the Social Security Act to revise the requirements and the formula for payments for services, including an implantable medical device, furnished to individuals in ambulatory surgical centers. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building".

H.R. 6163; S. 2812 - Medicare Telehealth Improvement Act of 2008.

Client expense: $60,000 · Firm income: Not reported

Government targets: HOUSE OF REPRESENTATIVES, Natl Institutes of Health (NIH), SENATE

Removing barriers to use of health information technology in the long-term care setting (Wired for Health Care Quality Act (S. 1693) -- all provisions, Medicare Telehealth Improvement Act (S. 2812) -- all provisions, Medicare Electronic Medication and Safety Protection (E-MEDS) Act (S. 2408, H.R. 4296) -- all provisions)

Client expense: Not reported · Firm income: $30,000

Government targets: Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, Health & Human Services, Dept of (HHS), SENATE