June 23, 2016

National Update

HHS announces $100 million to support small practices

The Medicare Access and Chip Reauthorization Act of 2015 (MACRA) contained a provision to fund on-the-ground training and education for Medicare clinicians in solo or small group practices of 15 clinicians or fewer. The U.S. Department of Health and Human Services (HHS) is required to award $20 million each year over the next five years for a total of $100 million to support small practices transitioning to the quality payment program.

The funds will help provide technical assistance to small practices—especially those in rural and medically underserved areas, as well as those in areas with health professional shortages. The AMA has been pressing HHS to release these funds.

Organizations can apply to receive funding for our efforts to support physicians in this process. To be eligible, organizations must be able to tailor training to clinicians and provide this education to them free of charge.

Learn more about the recent announcement and how to apply.

CMS publishes payment rule for lab tests

The Centers for Medicare & Medicaid Services (CMS) last week released the Medicare clinical laboratory diagnostic test payment system final rule. The final rule implements provisions of the Protecting Access to Medicare Act of 2014 (PAMA) pertaining to pricing and coding for clinical tests covered on the Medicare Clinical Laboratory Fee Schedule, as well as reporting requirements for clinical laboratories performing these tests.

Under the new regulations, CMS will require clinical laboratories, including those based in physician offices, to report private payer payment rates and corresponding volumes for many tests performed in physician office-based laboratories over a six-month data collection period.

CMS intends to require laboratories to report every three years and will use the data generated by this reporting requirement to re-price tests paid for on the Clinical Laboratory Fee Schedule. However, CMS also is finalizing a low expenditure threshold that will exempt the vast majority of physician office-based laboratories from the new reporting requirements.

The agency estimates approximately 5 percent of physician office-based laboratories will be required to report. Read the CMS fact sheet for more information.

Highlights from the 2016 AMA Annual Meeting

Another successful AMA Annual Meeting has come to a close. From the Zika virus to the opioid overdose epidemic to gun violence, physicians adopted policy to improve the health of the nation.

Here are some of the top stories:

Visit AMA Wire to read additional coverage of new policy adopted by physician delegates at the 2016 AMA Annual Meeting.

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Issue Spotlight

California joins growing opposition to insurer mergers

In a letter to the U.S. Department of Justice (DOJ), the California Department of Insurance (CDI) last week urged the DOJ to block the Anthem-Cigna merger in California on the grounds that the merger would substantially lessen competition.

The call for a block is a major development, given that California has the largest health insurance market in the nation and the CDI is nationally known for its expertise in health insurance regulation.

Why California said no
The CDI based its conclusion on the information obtained in a March 29 public hearing that included testimony and written comments from the public, patient advocates, experts on health insurance mergers, and both the AMA and California Medical Association (CMA).

The AMA and CMA jointly filed a comprehensive, evidence-based analysis (log in) explaining why the merger should be blocked. Both organizations also testified in person at the hearing before Insurance Commissioner David Jones, and worked hand-in-hand in developing a survey to determine the effect the merger would have on physician practices and patients.

"Based on the merger guidelines and data from California alone," Jones said in the letter, "the proposed merger of Anthem and Cigna will substantially lessen competition in the most populous state containing four of the 20 largest MSAs [metropolitan statistical areas] in the country."

Premiums would increase
Citing the AMA analysis, the CDI found that the Anthem-Cigna merger would likely enhance market power or raise significant competitive concerns in most of California's MSAs. The CDI also agreed with the AMA that lost competition through a merger would likely be permanent and acquired health insurer market power would be durable because of barriers to entry into the California health insurance markets.

As a consequence, the CDI reasoned that quality-adjusted premiums would increase, notwithstanding new medical loss rating requirements that to some extent regulate unreasonable premium increases.

Quality and consumer choice would suffer
The CDI recognized that the merger will harm patients because of its anticompetitive impact on physicians. In the letter, Jones stated that "… the merger would increase the monopsony power of the combined entities in purchasing the services of health care providers, thus likely decreasing the quality of services and increasing the price of health insurance."

Based in part on the AMA-CMA survey of physicians, the CDI letter also says that the physician surveys in other states in which Anthem has a substantial market share would likely "replicate the CMA survey results concerning physician vulnerability to Anthem-Cigna monopsony power. Allowing Anthem to increase its already enormous bargaining power will further limit network size and excessively squeeze reimbursement rates, thereby discouraging provider contracting and unacceptably reducing consumer choice and quality of care."

"The AMA commends the commissioner for acknowledging the evidence physicians and others presented," said AMA President Andrew W. Gurman, MD, in a statement, "demonstrating that the Anthem-Cigna merger would likely enhance market power or raise significant competitive concerns in most of California metropolitan areas."

The prospect of the other merger, Aetna's acquisition of Humana, last month received a major blow when the Missouri Department of Insurance issued an order preventing the companies from doing any post-merger business in Missouri's Medicare Advantage markets and some commercial insurance markets—if the merger should be allowed.

Price increases: An excerpt from the hearing
At the hearing in California on March 29, Jones directly questioned Jay Wagner, Anthem's vice president and counsel, and Thomas Richards, Cigna's global leader for strategy and business development, on the possibility of price increases and their claim that prices would actually decrease:

" … cost will not go up? [On] any product?" Jones asked.

"No, I can't commit to that," Wagner said.

"We would need … a guaranteed commitment from our provider partners in order to do that," Richards said. "I don't know that we have those in terms of multi-year guarantees in the system to be able [to] do that this morning."

"So none of you can provide any assurance that any of the health insurance products sold by any of the entities that will continue selling after the mergers will not increase in price, but at the same time, you're both very confident that there's going to be $2 billion in savings?" Jones asked.

"Correct," Wagner replied.

In the CDI letter to the DOJ, Jones said that he and his staff have been unable to find "reliable evidence in the public record that this merger will result in price decreases overall."

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State Update

Ohio enacts prior authorization legislation

Legislation to improve the prior authorization process in Ohio was signed into law last week. The Ohio State Medical Association (OSMA) was the leading force behind the legislation and helped create a broad coalition of supporters—including several medical specialty societies, the Cleveland Clinic, Ohio Children's Hospital Association, Ohio Pharmacy Association, the American Cancer Society and the Ohio Osteopathic Association—that helped build support and push the legislation across the finish line.

The OSMA also worked directly with the AMA Advocacy Resource Center during the deliberations on the bill.

The legislation was a direct response to concerns from Ohio physicians that prior authorization impedes access to care and places unnecessary administrative burdens on physician practices.

Among the many noteworthy provisions, the new law will:

Several other states, including Delaware and Pennsylvania, have introduced prior authorization legislation this year. The AMA offers model legislation (log in) and other prior authorization resources. For questions, email Emily Carroll of the AMA.

AMA expands policy to increase access to naloxone

Physician delegates last week adopted several new policies to further support the AMA's state legislative goal for every state to increase access to naloxone to help save lives from overdose.

The policies call on the AMA to support legislative and regulatory efforts that increase access to naloxone, including collaborative practice agreements with pharmacists and standing orders for pharmacies and, where permitted by law, community based organizations, law enforcement agencies, correctional settings, schools and other locations that do not restrict the route of administration for naloxone delivery.

The AMA also will increase efforts to support law enforcement agencies in carrying and administering naloxone and encourage private and public payers to include all forms of naloxone on their preferred drug lists and formularies with minimal or no cost sharing.

The new policy also furthers recommendations of the AMA Task Force to Reduce Opioid Abuse in encouraging physicians to co-prescribe naloxone to patients at risk of overdose and, where permitted by law, to the friends and family members of such patients.

In addition, the AMA will help support efforts to encourage individuals who are authorized to administer naloxone to receive appropriate education to enable them to do so effectively, as well as support liability protections for physicians and other health care professionals and others who are authorized to prescribe, dispense or administer naloxone pursuant to state law.

The AMA will use this new policy to help further strengthen state naloxone access laws. For any questions, email Daniel Blaney-Koen of the AMA.

AMA calls for comprehensive pain care, removal of "pain as the fifth vital sign"

Emphasizing the need for comprehensive and appropriate pain care for all patients, the AMA adopted several new policies. Delegates called on the AMA to strongly support timely and appropriate access to non-opioid and non-pharmacologic treatments for pain, including removing barriers to such treatments when they inhibit a patient's access to care.

New policy also calls on the AMA to:

MOC, confidentiality model bills ready for state legislative action

Following review and approval by the AMA Council on Legislation, the AMA Board of Trustees approved two new model bills last week.

The Right to Treat Act states that the state boards of medicine and osteopathic medicine cannot require a physician to maintain national or regional certification for licensure or license renewal. This model bill is consistent with AMA Principles on Maintenance of Certification (MOC) which state that the MOC program should not be a mandated requirement for licensure.

Language similar to what was included in the Right to Treat Act has also been included in the Interstate Medical Licensure Compact, clarifying that MOC or osteopathic continuous certification are not required for expedited licensure. Medical associations in states that have heard concerns regarding the compact and MOC can consider using the Right to Treat Act to calm these fears. For questions, email Kristin Schleiter of the AMA.

The Confidentiality of Enrollment in Physician (Professional) Health Programs Act will help ensure the confidentiality of physicians and others who are undergoing treatment in a physician health program (PHP). A PHP is a confidential resource for physicians, other licensed health care professionals and those in training who suffer from a substance use disorder, mental health condition, or other medical disease or potentially impairing condition. For questions, email Daniel Blaney-Koen of the AMA.

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Other News

CMS chief Andy Slavitt says physicians are guiding new payment system

In the effort to design the new Medicare payment system, Andy Slavitt, acting administrator of the CMS, said that the driving factor behind many of the changes was physician input—and the proposed rule attempts to reflect that. But the physician's role does not stop there.

"You represent one of America's most potent and proudest forces of talent and ability," Andy Slavitt, acting administrator of CMS, told physicians at the 2016 AMA Annual Meeting in Chicago. There is an historic opportunity before us, he said, "to change how Medicare pays for care."

"I'm also here to talk about something bigger: Reversing a pattern of regulations and frustration and ultimately unleashing a new wave of collaboration between the people who spend their lives taking care of us and those of us whose job it is to support that cause," Slavitt said.

Slavitt called upon physicians to not only work with him but also continue to work with CMS in the same manner after he departs from Washington.

"We don't profess to have all the answers," he said. "We continue to look for comments … on how to simplify further, how to align the performance categories, how to make sure we're not encouraging compliance but rather rewarding care."

CMS has collected comments, visited practices and held listening sessions with physicians and other health care professionals to learn from their expertise and experience as the new route in which health care system is headed is finalized, Slavitt said.

The proposed rule is open for comment through June 27, giving physicians and medical associations and societies an opportunity to provide their input to collaborate in the design of the new payment and care system. Physicians can submit comments through, the AMA's grassroots campaign.

The AMA will submit comments to CMS by that date to ensure physicians in all specialties and all practice sizes are properly represented so the system works in a way that allows them to determine the best ways to provide care for their patients.

As the health care system transitions to a new care and payment delivery system under the Medicare Access and CHIP Reauthorization Act (MACRA), physicians have a number of questions about how this process is going to work.

"The new program wraps around changes intended to promote coordinated care at reasonable costs through a uniform merit-based system," he said. "This system is defined in the statute to focus on quality, cost, technology and practice improvement."

The system also allows for physicians to design and participate in new models of payment, such as medical homes, specialty models, team-based models and other APMs.

"The goal of the program," Slavitt said, "is to return the focus to patient care, not spend time learning a new program."

Learn more:

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