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Trends in Health Policy

In Focus

CMS Issues Final 2024 Provider Payment Rules

This week, our In Focus section reviews several calendar year (CY) 2024 Medicare payment final rules that the Centers for Medicare & Medicaid Services (CMS) issued in recent weeks, including those pertaining to:

CMS also announced the OPPS Rule for 340B-Acquired Drug Payment Policy in response to court-invalidated payment rates and on November 6, 2023, released the 2025 Contract Year Policy and Technical Changes to Medicare Advantage. The latter regulation addresses guardrails for brokers, behavioral health expansions, and several dual eligible-related policies. We will analyze these provisions in next week’s In Focus.

These final rules set the payment rates and other Medicare payment policies for services that applicable providers provide under the fee-for-service Medicare program and take effect January 1, 2024. Additionally, the final rules, particularly the Physician Fee Schedule, are expected to further inform Congress’ discussions and, ultimately, any action on healthcare policies in a possible year-end legislative package.

For example, the Senate Finance Committee has released draft language that would mitigate the projected physician payment reduction, among other policy changes. Provider organizations and interested stakeholders will want to analyze the impact of the final policies across the rules, including new codes, payment rates, and opportunities to participate in accountable care organizations (ACOs).

Overall, Health Management Associates (HMA) notes several trends across these three Medicare payment regulations:

  • Health equity remains a significant focus of CMS under the Biden Administration.
  • The agency continues to expand its coverage of behavioral health services under Medicare and enhance payment for and access to these services.
  • Medicare is moving toward incrementally supporting care delivered in accordance with beneficiaries’ preferences, such as moving away from reimbursing largely for in-person services and toward supporting telehealth services.
  • CMS is creating pathways for reimbursement for a broader range of clinicians and caregivers who are addressing Medicare beneficiaries’ needs.
  • CMS continues its efforts to improve hospital price transparency with policies aimed at encouraging providers to publicly report data.

2024 Medicare Physician Fee Schedule and Other Part B Payment Policies Final Rule

On November 2, 2023, CMS released the final rule for the Medicare Physician Fee Schedule (MPFS) for CY 2024. CMS finalized an overall 1.25 percent decrease in MPFS payment rates from 2023 to 2024. The final 2024 PFS conversion factor remains largely unchanged ($32.74) from the proposed rule ($32.75) but will result in a 3 percent decrease from the CY 2023 conversion factor ($33.89). Among the most important policy changes in the final rule is the establishment of a new add-on code (G2211) for complex care provided in the primary care setting.

In addition, CMS will begin allowing additional behavioral health providers to participate in Medicare (described further below) and make numerous telehealth policy changes mandated in the Consolidated Appropriations Act of 2023. CMS also finalized changes to the Medicare Shared Savings Program (MSSP), which CMS estimates will increase ACO participation in MSSP by roughly 10−20 percent.

CMS finalized several policies to address health equity, including coding and payment changes focused on providing access to new services and addressing Medicare beneficiaries’ unmet health-related social needs (HRSNs). The final changes affect mental health and substance use disorder (SUD) treatment providers, address payment accuracy for primary care in the context of whole-person care, and expand access to dental care for cancer patients. The changes for 2024 include:

  • Caregiver training: Medicare will now pay practitioners who train caregivers to support patients with certain diseases (e.g., dementia) in carrying out a treatment plan. Services must be furnished by a physician or a non-physician practitioner or therapist.
  • Community health integration (CHI) services: The final rule includes separate coding and payment for CHI services, including person-centered planning, health system coordination, and facilitating access to community-based resources to address unmet social needs that interfere with a practitioner’s diagnosis and treatment plan.
  • Principal illness navigation (PIN) services: The final coding and payment rules for PIN services describe care navigation services for individuals with high-risk conditions. CMS included a subset of PIN services to support individuals with severe mental illness and SUD through use of auxiliary personnel (i.e., peer support specialists). The definition of a serious, high-risk condition is dependent on clinical judgment. CMS will monitor utilization across beneficiaries and specialties to ascertain how PIN services are best used going forward.
  • Social determinants of health risk assessments: This evaluation can be provided and billed as an add-on service to an annual wellness visit or with an evaluation and management or behavioral health visit.
  • Marriage and family therapists and mental health counselors, including eligible addiction, alcohol, or drug counselors who meet qualification requirements for mental health counselors: These types of providers may now enroll in Medicare and bill for their services starting January 1, 2024. The rule expands coverage and increases payment for crisis care (including mobile units), SUD treatment, and psychotherapy as well as psychotherapy performed in conjunction with an office visit and for health behavior assessment and intervention services.

2024 Hospital OPPS and ASC Final Rule

On November 2, 2023, CMS released a final rule for hospital OPPS and ASCs. The following policies are included in the final rule:

  • A 3.1 percent increase in payment rates for hospitals and ASCs that meet certain quality reporting requirements. This amount is based on the projected 3.3 percent increase in the hospital market basket and is consistent with the 2024 payment increase for inpatient services.
  • No services will be removed from the inpatient-only (IPO) list, but 10 procedures will be added to the IPO.
  • The list of ASC-covered surgical procedures will be updated to include 37 additional surgical procedures.
  • Drugs and biologicals acquired through the 340B program will have the same payment rate as those not acquired under the 340B program—the average sales price plus 6 percent.
  • CMS will pay for intensive outpatient program services. The final rule includes the scope of benefits, physician certification requirements, coding and billing, and payment rates.

340B Rule

Section 340B of the Public Health Service Act (340B) allows participating hospitals and other providers to purchase certain covered outpatient drugs or biologicals from manufacturers at discounted prices. Until 2018, the Medicare payment rate for Part B-covered outpatient drugs provided in outpatient hospitals was generally the average sales price (ASP) plus 6 percent. From 2018 through September 2022, CMS paid for these drugs at ASP (22.5 percent). After extensive litigation and a Supreme Court ruling, CMS returned payment for 340B drugs to ASP plus 6 percent in late 2022, and payment has continued at that level since. Consequently, payment for other services was reduced slightly more than 3 percent in 2023 to meet statutory budget neutrality requirements.

In this rule, CMS finalizes a remedy for 2018−22 payments in light of the court rulings. The agency will provide lump sum payments to 340B hospitals to cover the difference between ASP + 6 percent and ASP – 22.5 percent. Lump sum payments to 340B hospitals will result in roughly $9 billion in payouts to these facilities, in addition to the $1.5 billion they already have received through resubmitted claims. CMS had proposed that beginning in 2025, non-drug OPPS payments would be reduced by 0.5 percent to recover the budget neutrality-based payment increases resulting from the rescinded 340B cuts. According to CMS, hospitals received approximately $7.8 billion in additional spending on non-drug items and services because of budget neutrality. Earlier this year, CMS proposed a 0.5 percent pay cut to all hospitals, which would be in place for 16 years to fully adjust for the payment changes. CMS is finalizing the budget neutrality adjustment but will defer implementing these cuts to 2026 based on public comments about hospital budgetary pressures.

CY 2024 Home Health Prospective Payment System Final Rule

On November 1, 2023, CMS issued the CY 2024 Home Health Prospective Payment System (HH PPS) Rate Update final rule, which informs Medicare payment policies and rates for home health agencies (HHAs). This rule includes routine revisions to the Medicare Home Health PPS payment rates for CY 2024 in accordance with existing statutory and regulatory requirements. According to CMS estimates, Medicare payments to HHAs in CY 2024 will increase in the aggregate by 0.8 percent, or $140 million, from CY 2023.

However, CMS also finalized a permanent prospective payment adjustment to the CY 2024 home health 30-day period payment rate that reduces the update. This adjustment is intended to account for any increases or decreases in aggregate expenditures that result from the implementation of the Patient-Driven Groupings Model (PDGM) and 30-day unit of payment as required in the Bipartisan Budget Act of 2018. The finalized −2.890 percent adjustment is half the total projected adjustment of negative 5.779 percent. As a result, CMS estimates that Medicare payments to HHAs in CY 2024 will increase in the aggregate by 0.8 percent, rather than the 2.2 percent decrease as initially proposed.

CMS’ decision to implement only half of the permanent prospective payment adjustment in CY 2024 was in response to concerns from public commenters about the magnitude of implementing the proposed large single-year payment reduction. However, CMS also maintains that it will have to account for the remaining permanent adjustment it chose not to apply in CY 2024 and make other potential adjustments to the base payment rate in future rulemaking.

Other Proposals

CMS also is finalizing proposals to:

  • Rebase and revise the home health market basket to adopt a 2021-based home health market basket, including proposed changes to the market basket cost weights and price proxies
  • Reduce the labor-related share of the market basket to 74.9 percent based on the 2021-based home health market basket compensation cost weight (down from 76.1 percent)
  • Recalibrate the PDGM case-mix weights using CY 2022 data
  • Update the low utilization payment adjustment thresholds, functional impairment levels, and comorbidity adjustment subgroups for CY 2024
  • Codify statutory requirements for disposable negative pressure wound therapy
  • Establish regulations to implement payment for items and services under two new benefits: lymphedema compression treatment items and home intravenous immune globulin
  • Establish several enrollment provisions for hospices and other provider types and create a new informal dispute resolution process for hospice programs and a special focus program to provide enhanced oversight of the poorest-performing hospices
  • Implement various changes to the Home Health Quality Reporting Program and Home Health Value-Based Purchasing Model

2024 End-Stage Renal Disease Prospective Payment System Final Rule

On October 27, 2023, CMS issued a final rule that updates payment rates and policies under ESRD PPS for renal dialysis services furnished to Medicare beneficiaries on or after January 1, 2024. This rule also updates the acute kidney injury (AKI) dialysis payment rate for renal dialysis services that ESRD facilities furnish in CY 2024.

For CY 2024, CMS will increase the ESRD PPS base rate to $271.02, upping total payments to ESRD facilities by approximately 2.1 percent. The CY 2024 ESRD PPS final rule also includes several changes related to ESRD PPS payment policies.  First, the rule includes a payment adjustment that will increase payment for certain new renal dialysis drugs and biological products after the transitional drug add-on payment adjustment period ends. According to CMS, the increase will ensure payment is not a barrier to accessing innovative treatments for Medicare ESRD beneficiaries.

For more details about the policies described herein, contact Amy Bassano ([email protected]), Zach Gaumer ([email protected]), Andrea Maresca ([email protected]), John Richardson ([email protected]), Kevin Kirby ([email protected]), or Rachel Kramer ([email protected]).


HMA Information Services Names Andrea Maresca as Managing Director

Health Management Associates has named Andrea Maresca as Managing Director of HMA Information Services, one of the nation’s leading subscription-based repositories of data and public documents on publicly sponsored healthcare programs.

Maresca replaces HMAIS founding publisher Carl Mercurio, who will stay on as Senior Advisor until the end of the year when he retires after nearly a decade with HMA and 37 years in business information publishing.

Maresca has more than two decades of healthcare experience, having served in private and public organizations including the Centers for Medicare & Medicaid Services (CMS) and the National Association of Medicaid Directors (NAMD).  She joined HMA in 2021.

HMA Roundup


Arizona to Award $47.5 Million to HCBS Providers in Second Round of ARP Grant Funding. The Arizona Health Care Cost Containment System announced on November 6, 2023, that it will award $47.5 million in grant funding from the American Rescue Plan (ARP) to help strengthen the state’s Home and Community Based Services (HCBS) through a second round of the ARP Program Awards. HCBS eligible providers can apply for up to $1,000,000 for programmatic or infrastructure projects to improve health, safety, and member experience. Applications are open from December 4 to January 15. Read More

Arizona Granted Temporary Extension to Pay Parents as Caregivers in LTC Program. The Arizona Health Care Cost Containment System announced on November 6, 2023, that it has received a letter from the Centers for Medicare & Medicaid Services (CMS) granting a temporary extension to pay parents for providing care to their minor children enrolled in the Arizona Long Term Care System (ALTCS). The extension will allow Arizona and CMS to continue negotiations over the Appendix K demonstration amendment, an amendment to the approved Section 1915c waiver granted during the COVID-19 emergency, to allow the program to continue permanently. Read More

Arizona Sets New Medicaid FFS Rates For Applied Behavior Analysis Services. The Arizona Health Care Cost Containment System (AHCCCS) announced on November 1, 2023, a new designated Medicaid fee-for-service (FFS) fee schedule for Applied Behavioral Analysis (ABA) services effective November 1, 2023. The new fee schedule only applies to fee for service claims. Currently, providers are reimbursed 58.66 percent of the billed rate they submit for FFS claims. Based on feedback received during the public comment period, Arizona will also include a “in-home” reimbursement rate and rate differentials on codes for practitioners with a masters degree. Read More


California Minimum Wage Increase for Healthcare Workers Estimated to Cost $4 Billion in Fiscal 2025. The Los Angeles Times reported on November 4, 2023 that California’s new law to raise the minimum wage for healthcare workers to $25 per hour over the next decade is estimated to cost the state $4 billion in fiscal 2025, with half being paid for by the state’s general fund and the other half paid for by California’s Medicaid program. An estimated half a million healthcare workers who provide services to Medicaid patients and 26,000 employees at state-owned facilities will be affected by the wage hike. Read More


Florida Releases Comprehensive IDD Managed Care Pilot Program ITN. The Florida Agency for Healthcare Administration released on November 3, 2023, an invitation to negotiate (ITN) to transfer the state’s home and community based services for the intellectual and developmental disabilities (IDD) population, which currently utilize a fee-for-service reimbursement system through the Developmental Disabilities Individual Budgeting waiver, to a pilot program for Long-Term Care plans participating in the Statewide Medicaid Managed Care (SMMC) program. Responses are due December 8, 2023, and awards are anticipated for January 31, 2024. The state intends to contract with one vendor for each of the two pilot regions, SMMC regions D and I. The initial phase will enroll up to 600 individuals and contracts will run from the execution date in 2024 through September 30, 2030. There are currently 22,000 eligible individuals. Read More

House Rejects Bill to Ease Premiums, Cost Sharing in Medicaid, KidCare. The Pensacola News Journal reported on November 7, 2023, that the Florida House rejected a bill to remove premiums and cost sharing for preventive services for individuals in Medicaid and KidCare at or below 200 percent of poverty. The bill would have also required the state to publish Medicaid and KidCare data publicly. Read More


Idaho Health Data Exchange Lacked Accountability Measures, Report Finds. Idaho Capital Sun reported on November 6, 2023, that the Idaho Health Data Exchange, a nonprofit created by the Department of Health and Welfare to broaden access to health data, lacked accountability measures and regulations, according to a report by the Idaho Office of Performance Evaluations. The report suggested that the legislature consider competitive bidding, external oversight, and clarification of authority in future public-private partnerships. Read More


Indiana Budget Committee Approves Medicaid Rate Cuts for Autism Therapy Services. Indiana Public Media reported on October 30, 2023, that the Indiana State Budget Committee approved cuts to the Medicaid reimbursement rates for autism therapy services to $68.24 an hour, representing a decrease from the previous average rate of $91 per hour. The new rates from the Indiana Family and Social Services Administration (FSSA) are up from an earlier proposed rate of $55.19 per hour which was met with criticism. The new rate will take effect January 1, 2024. Read More


Iowa Releases Medicaid Quality Improvement Organization Services RFP. The Iowa Department of Health and Human Services released on November 2, 2023, a request for proposals (RFP) to procure a Quality Improvement Organization (QIO) vendor for the Iowa Medicaid program. Iowa will award one contract to operate for two years, with the option for four one-year contract extensions. Proposals are due February 5, 2024, with awards expected on March 29, 2024. The anticipated contract start date is July 1, 2024. The current QIO is Telligen. Read More

Iowa to Revamp HCBS Program to Streamline Services. KCRG reported on November 6, 2023, that Iowa is hosting listening sessions as part of a modification process for its Home and Community Based Services (HCBS) waiver program. The state currently has 14,000 waitlisted individuals that have not yet received HCBS benefits. The department is looking to increase accessibility, decrease the number of waiver categories, and make all services equitable. Read More


Kansas Schools Fail to Perform Provider Background Checks on Employees Providing Medicaid-related Services, Audit Finds. Pre-Employ reported in November 2023 that Kansas schools failed to perform background checks on 31 percent of providers audited by the Office of Medicaid Inspector General. The figure is based on a sample of 3,731 providers employed by school districts in the state. Read More


Missouri Disenrolls 52,000 Children From Medicaid During First Four Months of Redeterminations. The Missouri Independent reported on November 7, 2023, that Missouri has disenrolled more than 52,000 children from Medicaid during eligibility redeterminations from June through September. The state is unsure how many may have reenrolled. Read More


Nebraska Medicaid Director Resigns. The Omaha World-Herald reported on November 1, 2023, that Nebraska’s director of Medicaid and Long-Term Care (LTC), Kevin Bagley, will resign effective December 1 after three years in the position. Matt Ahern, current deputy director of policy and plan management for the state’s Department of Health and Human Services, will serve as interim director until a permanent replacement is selected. Read More

New Hampshire

New Hampshire Hospital Sues NH DHHS, Federal Government Over DSH Payments. NH Business Review reported on November 2, 2023, that Concord Hospital has filed a lawsuit against the New Hampshire Department of Health and Human Services (DHHS), the U.S. Department of Health and Human Services, and the Centers for Medicare & Medicaid Services to stop the clawback of $8 million in alleged Medicaid Disproportionate Share Hospital (DSH) overpayments accrued between 2011 and 2017. The suit, filed in U.S. District Court, aims to stop DHHS from recouping and redistributing the funds to other hospitals in the state, claiming reporting of uncompensated care costs under the Medicaid State Plan was required without any comprehensive guidance on which costs were allowable. Read More

New Jersey

New Jersey Adult Day Care Centers Received Nearly $1 Million in Improper Payments, Report Finds. NorthJersey.com reported on October 31, 2023, that 21 adult day care centers received nearly $1 million dollars in approximately 11,000 false claims, according to a report from the State Comptroller’s Office. The most common errors included duplicate billings for the same person, billing for a person in another facility who had already received services, and billing for over five days a week. Although officials have not determined if the claims were mistakes or intentional fraud, Medicaid has regained $839,000 of the $946,087 improper payments. Read More

New York

New York Governor Announces Medicaid Coverage of Doula Services, Funding for Perinatal Centers. New York Governor Kathy Hochul announced on November 6, 2023, that the state’s Medicaid program will cover doula services beginning January 1, 2024, as a part of efforts to reduce high maternal mortality rates in the state, especially among Black women. Additionally, the state allocated $4.5 million to regional perinatal centers, which provide perinatal and infant care, to support collaboration among centers and provider training. Read More

New York Grants $12 Million to Serve Individuals with Complex Behavioral Health Needs. Crain’s New York Business reported on November 7, 2023, that the New York Office of Mental Health allocated a total of $12 million to three behavioral health agencies to implement the Intensive and Sustained Engagement Teams (INSET) model, which allows certified peer specialists to provide care to individuals with complex behavioral health needs. Each agency will receive $4 million dollars over the course of five years to broaden access to care and support connections to housing and employment. Read More

Behavioral Health Providers Attribute Financial, Staffing Challenges to Managed Care, Survey Finds. Crain’s New York Business reported on November 8, 2023, that New York behavioral health providers blame Medicaid managed care plans for financial and staffing challenges, according to a survey conducted by the NYS Council for Community Behavioral Healthcare. The Council is pushing for a reversal of the 2015 transition of behavioral health from fee-for-service to managed care. Read More

New York Extends Exchange Open Enrollment Period Through May 2024. Crain’s New York Business reported on November 7, 2023, that the New York Exchange has extended the open enrollment period for all health plan products through May 2024. Read More

Medicaid Pharmacy Carve-out Glitch Led to 6 Months of Overpayments. The Empire Center reported on November 3, 2023, that during the rollout of New York’s Medicaid pharmacy carve-out from managed care, Medicaid has continued to reimburse health plans for prescription drug coverage they were no longer providing from April through September, according to a mid-year financial plan update from the state Budget Division. The state is currently recouping the overpayments by temporarily reducing the plans’ monthly premiums. Read More

New York Creates Advisory Board to Address State Healthcare Challenges, Provide Recommendations. Crain’s New York Business reported on November 2, 2023, that New York Governor Kathy Hochul launched an advisory board that is charged with addressing and providing recommendations for New York’s health care challenges, which include controlling Medicaid costs, helping hospitals that are struggling financially, and making adjustments to the Medicaid program. The New York State Commission on the Future of Health Care advisory board will submit formal recommendations to the governor’s office each year, with its first set of recommendations due before the end of 2024. Read More

North Carolina

North Carolina Order Dissolves Sandhills Behavioral Management Entity, Consolidates Two Others. NC Health News reported on November 8, 2023, that North Carolina Department of Health and Human Services Secretary Kody Kinsley issued a directive dissolving the Sandhills Center Local Management Entities-Managed Care Organization (LME-MCO), one of the state’s behavioral health management companies. Kinsley also ordered the consolidation of the Eastpointe and Trillium Health Resources LME-MCOs. The directive, which reduces the number of LME-MCOs from six to four, is intended to hasten the delayed rollout of tailored plans to approximately 143,000 individuals with severe mental health conditions or intellectual and developmental disabilities. Read More

Puerto Rico

GuideWell Names Thurman Justice President, CEO of Triple-S Management. Florida-based GuideWell Mutual Holding Corporation announced on November 1, 2023, that it has named Thurman Justice as president and chief executive of Triple-S Management Corporation which serves nearly one-third of Puerto Rico’s population, effective February 1, 2024. Justice was previously the CFO of GuideWell and also served as President of Triple-S Salud and Triple-S Advantage, Puerto Rico’s Blue Cross Blue Shield affiliates. Read More


Wyoming Submits Section 1115 Waiver Request to Provide HCBS to Individuals Over Age 65. The Centers for Medicare & Medicaid Services (CMS) announced on November 8, 2023, that Wyoming submitted for federal approval a Medicaid Section 1115 waiver demonstration to provide home and community based services (HCBS) to individuals over the age of 65 who are currently ineligible for Medicaid. The public comment period will be open through December 8. Read More


Medicare Advantage Plans Enjoy Higher Payments than FFS, MedPAC Reports. Health Payer Specialist reported on November 8, 2023, that Medicare Advantage (MA) plans received $38.5 billion more than fee-for-service (FFS) Medicare to cover comparable members between 2017 and 2021, according to a Medicare Payment Advisory Committee (MedPAC) study. MedPAC attributed the disparity to aggressive MA coding and favorable risk selection. Read More

CMS Introduces Medicare Advantage and Medicare Prescription Drug Benefit Proposed Changes for 2025. The Centers for Medicare & Medicaid Services (CMS) released on November 7, 2023, the contract year 2025 Medicare Advantage and Prescription Drug proposed rule, which includes several new policies that would revise regulations governing Medicare Advantage, the Medicare Prescription Drug Benefit, Medicare cost plans, and Programs of All-Inclusive Care for the Elderly. The proposed changes include increasing the percentage of dually eligible enrollees receiving Medicare and Medicaid services from the same organization; lowering the Dual-Eligible Special Needs Plan (D-SNP) look-alike threshold; expanding permissible data use for Medicare Advantage encounter data; and limiting out-of-network cost sharing for D-SNP Preferred Provider Organizations. The comment period will run through January 5, 2024. Read More

CMS Issues Proposed Rule Targeting Medicare Advantage Health Plan Marketing, Brokers. The Centers for Medicare & Medicaid Services (CMS) released on November 6, 2023, a proposed rule to prevent Medicare Advantage health plans from utilizing anti-competitive practices by restricting marketing practices and capping health plan payments to brokers at $632 per enrollment beginning in 2025. In the prescription drug marketplace, the rule encourages use of lower-cost, biosimilar drugs as substitutes for reference products. The proposed rule will also add a new facility type to include numerous behavioral health providers in an effort to broaden access mental health and substance use disorder treatment. The 60-day public comment period will close January 5, 2024. Read More

Medicare to Expand List of Eligible Behavioral Health Providers in January. KFF Health News reported on November 3, 2023, that Medicare will allow marriage and family therapists and mental health counselors to offer services beginning in January, which could broaden access to up to 400,000 providers. Medicare will also include up to 19 hours a week of intensive outpatient care and broaden mobile crisis services to treat beneficiaries in the home and on the streets. Read More

CMS CY 2024 Medicare Physician Fee Schedule Final Rule Cuts Payments by 1.25 Percent. The Centers for Medicare & Medicaid Services (CMS) finalized on November 2, 2023, the calendar year (CY) 2024 Medicare Physician Fee Schedule (PFS) final rule, which will decrease reimbursements under the PFS by 1.25 percent overall compared to CY 2023 and includes separate coding and payment for new services aimed at serving underserved populations and supporting caregivers. The rule also broadens the types of behavioral health providers eligible for Medicare, adjusts payment and coding for primary care services, finalizes payment for dental services linked to cancer treatment, and promotes diabetes care in underserved communities. Read More

CMS CY 2024 Hospital Outpatient Prospective Payment System, Ambulatory Surgical Center Final Rule Increases Payments by 3.1 Percent. The Centers for Medicare & Medicaid Services (CMS) released on November 2, 2023, the calendar year (CY) 2024 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) final rule, which will increase payment rates by 3.1 percent for hospital outpatient and ASC services and implement the Consolidated Appropriations Act to expand intensive outpatient program services to improve behavioral health care for Medicare beneficiaries. The rule also broadens hospital price transparency regulations in order to aid the public’s understanding of what hospitals charge for specific services. Read More

CMS Finalizes 0.8 Percent Home Health Payment Increase For 2024. Modern Healthcare reported on October 1, 2023, that the Centers for Medicare & Medicaid Services (CMS) issued a final rule increasing Medicare reimbursements for home health providers by 0.8 percent, beginning in calendar year 2024. CMS previously proposed a 2.2 percent Medicare payment cut in the draft regulation. The home health prospective payment final rule applies a Patient-Driven Groupings Model adjustment of negative 2.9 percent to the 2024 home health payment rate, which combined with other factors, nets the 0.8 percent rate increase. Read More

CMS Releases Final Rule Addressing Remedy for the Invalidated CY 2018-22 340B-Acquired Drug Payment Policy. The Centers for Medicare & Medicaid Services (CMS) released on November 2, 2023, a final rule which details the remedy for the invalidated Hospital Outpatient Prospective Payment System 340B-acquired drug payment policy for Calendar Years (CY) 2018-2022. The approximately 1,700 hospitals affected by the CY 2018-2022 policy will receive a one-time lump sum payment to address the remaining $9 billion of the $10.6 billion owed. Read More

Senators Introduce Bill to Ensure Medicaid Coverage for Foster Care Children. U.S. Senator Marco Rubio (R-FL) announced on November 2, 2023, the introduction of a bill, co-sponsored by Thom Tillis (R-NC), to allow foster children placed in Qualified Residential Treatment Programs (QRTPs) to continue to receive coverage under Medicaid. QRTPs work with youth struggling with psychological, behavioral, or substance use issues. Read More

Republican Governors Criticize Proposed Federal Nursing Home Staffing Rule in Letter to President Biden. 1011 Now reported on November 2, 2023, that 15 Republican governors have sent a letter to President Biden criticizing the Centers for Medicare & Medicaid Services’ (CMS) proposed federal nursing home staffing rule. Nebraska and Iowa initiated the letter and are joined by Georgia, Indiana, Mississippi, Missouri, Montana, Nevada, New Hampshire, Oklahoma, South Carolina, South Dakota, Tennessee, Texas and Wyoming. The rule, which was released September 1 and introduces minimum staffing standards to nursing homes across the country, remains open for public comment until November 6. Read More

Senators Release Draft Policies Aimed at Expanding Mental Healthcare, Reducing Prescription Drug Costs. Senate Finance Committee Chair Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) released on November 2, 2023, a discussion draft of proposed Medicare and Medicaid policies aimed at improving access to mental health care and reducing prescription drug costs. The draft policies include extending expiring Medicaid and Medicare provisions, expanding the number of mental health and substance use providers participating in Medicare, and advancing pharmacy benefit manager reforms passed in July, among others. The committee will hold a markup on November 8. Read More

Medicaid Disenrollments Top 10 Million Following Redeterminations. KFF reported on November 1, 2023, that over 10 million Medicaid enrollees have been disenrolled since eligibility redeterminations began. Nearly 1.9 Million children have been disenrolled in the 20 states reporting age breakouts. Disenrollment rates varied widely between states, ranging from 65 percent in Texas to 10 percent in Illinois. Approximately 71 percent of people have been disenrolled for procedural reasons across all states with available data. Read More

Doulas Are Essential Part of Improving Maternal Health, MACPAC Study Finds. The Medicaid and CHIP Payment and Access Commission (MACPAC) reported in November 2023, that doulas are an essential part of improving maternal health, according to a survey of officials from five states: Florida, Minnesota, New Jersey, Oregon, and Rhode Island. Challenges include payment barriers, data collection, and training. Read More

MACPAC Comments on CMS Minimum Staffing Standards, Medicaid Payment Transparency Proposed Rules. The Medicaid and CHIP Payment and Access Commission (MACPAC) released on November 6, 2023, a comment letter to the Centers for Medicare & Medicaid Services (CMS), to support the agency’s efforts to increase Medicaid payment transparency. However, MACPAC recommended that CMS collect additional information on facility costs and payments. MACPAC also advised CMS to consider potential unintended consequences of the proposed minimum staffing standards for long-term care facilities. Read More

Industry News

CVS Health Is No Longer Selling Omnicare. Health Payer Specialist reported on November 8, 2023, that CVS Health is no longer planning to sell off Omnicare, a long-term care pharmacy. Read More

Cigna Explores Sale of Medicare Advantage Business. Reuters reported on November 6, 2023, that Cigna is considering options to sell its Medicare Advantage business. Cigna anticipates continued below-target profit margins in Medicare Advantage for 2024, which generated 4.4 percent of its 2022 revenue. The company has noted that high administrative expenses and changes in the federal government’s reimbursement model negatively impacted profits. Read More

Pediatric Home Service Announces Acquisitions of Apple Home Medical Supply, All About Pediatrics. Pediatric Home Service, a children’s home care provider, announced on November 1, 2023, the acquisitions of Dallas-based Apple Home Medical Supply and Florida-based All About Pediatrics, a provider focused on the needs of children with medical complexities. Pediatric Home Service now serves patients throughout Florida, Indiana, Iowa, Kansas, Kentucky, Missouri, Nebraska, Ohio, Texas, and Wisconsin. Read More

Medica Names Lisa Erickson as President, CEO. Medica announced on November 1, 2023, that Lisa Erickson has been named president and chief executive. Erickson previously served as chief financial officer for Medica. Read More

Honor Health Network Acquires Georgia Home Care Provider Nightingale. Honor Health Network, a portfolio company of Webster Equity Partners, announced on October 24, 2023, that it will acquire Georgia home care provider Nightingale Services, Infusion, and Pharmacy. With the acquisition, Honor Health Network now operates in six states and Washington D.C. Read More

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