Monday, November 23, 2015

HHS Secretary Burwell Releases FY 2015 Agency Financial Report

Dan Ciolek

On November 15, 2015, the U.S. Department of Health and Human Services (HHS) Administrator, Sylvia M. Burwell released the Fiscal Year 2015 Agency Financial Report. In the report, the Secretary highlighted that in FY 2015, Medicare Part A expenditures = $285.1 billion, Medicare Part B = 281.6 billion, Medicare Part D = $80.6 billion, and Medicaid = 378.9 billion.

In the report, the Secretary indicated that the Comprehensive Error Rate Testing (CERT) program used to calculate the improper payment estimate, identified that the Medicare fee-for-service (FFS) gross improper payment estimate for FY 2015 is 12.09 percent or $43.33 billion. Within that rate, insufficient documentation was common for Skilled Nursing Facility (SNF) claims. Specifically, the improper payment rate for SNF claims increased from 6.94 percent in FY 2014 to 11.04 percent in FY 2015.

The Secretary listed corrective actions to address root causes of the errors, and stated the following:

“HHS and its contractors develop medical review strategies using the improper payment data to ensure the areas of highest risk and exposure are targeted. HHS requires its Medicare review contractors to focus on identifying and preventing improper payments due to documentation errors in certain error prone claim types, such as home health, hospital outpatient, and skilled nursing facility (SNF) claims.” 

Several statements in the report were SNF-specific and included the following:

 · Under the Management Challenge 2 section, the report states “Certain payment policies that create incentives for providers to bill for more expensive care instead of the appropriate levels of care result in billions of dollars in wasteful spending and compromised care for beneficiaries. For example, Medicare’s payment policy for skilled nursing facility (SNF) beneficiaries who also need therapy give providers incentive to bill for higher levels of therapy than necessary.”

 · Later in this section the report states “CMS reports that it is working to identify potential alternatives to the existing methodology used to pay for therapy services under the SNF Prospective Payment System (PPS). CMS initiated the SNF PPS Payment Model Research project and reports that it is working to identify potential alternative SNF payment models for further analysis.”

· Under a section titled Management Challenge 6, the report states “In August 2015, CMS finalized a rule for the PPS and Consolidated Billing for SNFs for FY 2016. This rule implemented section 6106 of the Affordable Care Act, which allows for greater oversight and increased accuracy for reporting of nursing home staffing on the Nursing Home Compare website and in the Five Star Quality Rating System. Also, this rule specified a SNF all-cause all-condition hospital readmission measure and adopts that measure for a new SNF Value-Based Purchasing (VBP) Program. Additionally, the rule will implement a new quality reporting program (QRP) for SNFs that authorizes CMS to reduce payments to nursing homes that do not report certain resident assessment items and establishes the plan to standardize certain elements of assessment tools and quality measures across post-acute care settings.”

 · Later in this section the report states “In July 2015, CMS published a proposed rule to improve the quality of nursing home care that updates Medicare requirements for long-term-care facilities. This proposed rule also would implement provisions of the Affordable Care Act, including requirements for facilities to implement a Quality Assurance and Performance Improvement (QAPI) program that would ensure that facilities continuously identify and correct quality deficiencies and promote and sustain performance improvement. Additional provisions would implement requirements for a Compliance and Ethics program, requirements for dementia and abuse prevention training, and requirements for reporting suspected crimes.”

While the updated utilization and error rate figures are new, the remainder of the Secretary’s report does not contain any new information related to SNF services, and what activities that agency is taking to assure that Medicare dollars are being spent wisely on high-quality services. 

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