CMS Issues Additional Payment Reform Rules
After publishing a far-reaching rule Monday, the Centers for Medicare and Medicaid Services (CMS) issued today a proposed reform rule as well as proposed rates for outpatient hospitals and ambulatory surgery centers. Outpatient rates for hospitals would increase by 2.4% in 2026. Ambulatory surgery centers also would increase by 2.4% in 2026.
Most important, CMS proposes important reforms to reduce the costs in Medicare over time. Many of these were proposed earlier during Trump 45, but the Biden administration rescinded the proposals upon coming to office. The reforms include:
— Phasing out the inpatient only list over a 3-year period and allowing the services to be performed in a hospital outpatient setting or ambulatory surgery center.
— Reforming the ambulatory surgery center list by updating its general criteria and shifting five exclusion criteria into a new, nonbinding section to allow the expansion of services, including inclusion of codes from the inpatient only list.
— Updating the hospital price transparency rule with more requirements.
— Applying the Physician Fee Schedule payment rates to a broader swath of services at hospital outpatient and hospital owned settings, especially drug administration. This is a modest but good step toward site neutrality.
Additional articles: https://www.fiercehealthcare.com/providers/cms-floats-24-annual-outpatient-asc-pay-bump-alongside-price-transparency-site-neutrality and https://www.cms.gov/newsroom/press-releases/cms-proposes-bold-reforms-modernize-hospital-payments-strengthen-transparency-and-put-patients-back and https://www.cms.gov/newsroom/fact-sheets/calendar-year-2026-hospital-outpatient-prospective-payment-system-opps-and-ambulatory-surgical
#medicare #hospitals #siteneutral #ascs
On To The Real Healthcare Business In Congress
With the big beautiful bill signed, Congress now has to get back to business to close out many important healthcare issues in 2025. The following are on the docket and many need reauthorization.
- Authorizations for extensions and funding for community health centers, telehealth and hospital at home
- Prior authorization reform
- Pharmacy benefits manager reform
- Medicare Advantage overpayments and risk adjustment reform
- Site neutral payments
In other news, Sen. Josh Hawley, R-MO, who just voted for the budget bill is sponsoring a bill to undue many Medicaid reductions and up the rural healthcare pool to $100 billion.
Further, Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr. rather ridiculously tried to argue that the budget bill did not really have cuts to Medicaid, arguing the absolute rate of spending will not drop.
Last, Modern Healthcare has a good article explaining the provider tax, state directed payments, and how the bill changes them.
Additional article: https://www.modernhealthcare.com/politics-regulation/mh-congress-medicare-advantage-telehealth-doctor-pay/ and https://thehill.com/policy/healthcare/5402636-hawley-seeks-to-repeal-medicaid-cuts-he-voted-for/?tbref=hp and https://thehill.com/homenews/administration/5401108-rfk-jr-medicaid-cuts-big-beautiful-law/
#budgetreconciliation #trump #congress #priorauthorization #pbms #medicareadvantage #siteneutral
https://www.modernhealthcare.com/providers/mh-provider-taxes-medicaid-hospitals
PBM Reform Bill Is Bipartisan
While major pharmacy benefit management (PBM) reform was removed from the recent budget reconciliation bill by the Senate, a bipartisan House bill seeks to implement far-reaching reforms. The bill would ban spread-pricing models in Medicaid and move to a “transparent” system of reimbursement to pharmacies. The bill also would delink PBM compensation from medication costs within Part D and mandate reporting on spending, rebates, and formulary decisions.
One of the sponsors wants to also tackle vertical consolidation in the PBM industry.
#pbms #drugpricing #medicaid #medicare
https://www.fiercehealthcare.com/payers/bipartisan-legislators-revive-pbm-reform-debate-hill
Doc Groups Say Proposed Medicare Payment Increase Is Inadequate
Physician groups are upset that the proposed Medicare rate increase “doesn’t come close” to making up for a 33% decline in pay since 2001. The Centers for Medicare and Medicaid Services (CMS) proposed an increase of 3.62% to 3.83% in 2026 depending on whether the doctor participates in alternative payment models. This is actually above the budget bill mandate but is a one-time boost and does not represent structural reform.
#medicare #physicians #rates
https://www.medpagetoday.com/publichealthpolicy/medicare/116513
United May Have Boosted Revenue By Selling Stakes In Business Units To Hide Financial Woes
UnitedHealth Group is being accused of boosting its revenue and margins before its books closed in 2024 via sales of stakes in business units. The company booked an additional $3.3 billion of annual profit, mostly in the fourth quarter. It is said that this helped hide financial woes at the insurance units as well as some spillover to service units.
Now, United’s conduct does not seem to violate disclosure rules. The company alluded to the dispositions in earnings reports and quarterly calls. But it certainly undermines investor confidence in the company and calls into question how transparent the company was throughout the year.
(Article may require a subscription.)
#unitedhealthcare #margins
https://www.modernhealthcare.com/insurance/mh-unitedhealth-group-earnings-asset-sales
Enrollment in Medicare Advantage Reviewed
Medicare Advantage’s (MA) footprint is quite robust in many places and therefore gives the average beneficiary access to 34 benefit plans with drug coverage in 2025. This is double what it was in 2018. At the same time, a health policy group KFF analysis does find that MA markets are highly concentrated and competitiveness may be limited. UnitedHealthcare or Humana had the largest market share in two-thirds of U.S. counties, making up nearly 60% of total MA enrollment last year. Last year as well, 9 in 10 Medicare enrollees lived in a county where at least half of MA beneficiaries were covered by plans sponsored by just one or two insurers.
In other news, a Health Affairs Forefront Blog makes the case that it is time to create fully integrated accountable care organizations for dual eligibles. The blog notes the numbers of duals are increasing in ACOs. The move would match up with efforts to move to fully integrated special needs plans (SNPs) in Medicare Advantage (MA). SNPs are undergoing explosive growth.
Additional article: https://www.kff.org/medicare/issue-brief/most-medicare-advantage-markets-are-dominated-by-one-or-two-insurers/ and https://www.healthaffairs.org/content/forefront/case-integrated-medicare-and-medicaid-accountable-care-organizations-dual-eligible
#medicareadvantage #marketing
https://www.healthcaredive.com/news/medicare-advantage-markets-controlled-few-insurers-kff/753113
PEPFAR To Be Restored In Rescission Bill
The Trump administration is asking Congress to rescind about $9 billion in spending as part of the impoundment law. However, some lawmakers are insisting that PEPFAR, the global anti-AIDS initiative, be removed from the cuts.
#rescissions #impoundement #hivaids #pepfar
https://thehill.com/homenews/senate/5402273-white-house-accepts-pepfar-exemption/
— Marc S. Ryan
