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Tag: Medicare

BREAKING: Medicare’s Pioneer Program Down to 19 ACOs After Three More Exit

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Three years after the CMS carefully selected 32 accountable care organizations deemed best able to manage the Pioneer program’s financial risks, three more have decided they no longer want to. The new departures—the program is now down to 19 ACOs—suggest even the most sophisticated health systems may be unwilling to take losses as policymakers test new payment and delivery models.

Franciscan Alliance in Indianapolis, Genesys PHO in Flint, Mich., and Renaissance Health Network in Wayne, Pa., have exited the program, which is now in its third year.

The ongoing trickle of departures from the Pioneer program underscores the broader tension and debate among providers, policymakers and health systems exploring ways to overhaul the way Medicare pays hospitals and doctors—attempts that have rippled through private markets as commercial health plans follow suit.

Read the full report here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

Interest Surges in Medicare Bundled-Payment Initiative

Medicare will nearly triple the number of hospitals and medical groups that are candidates to test bundled payments, one of the health reform law’s efforts to revamp healthcare financing.
The CMS announced it will add roughly 4,100 providers to about 2,400 already exploring the possible use of bundled payments for some or all of four dozen medical conditions and procedures, such as diabetes, joint replacements and pacemaker implants. Providers have to apply to become candidates.

These roughly 6,500 candidates will analyze Medicare spending data to decide whether or not to enter into bundled-payment contracts, which must reduce Medicare costs by 2% to 3.5% before providers are rewarded, with some exceptions.

Medicare launched the payment bundles in January 2013 under the healthcare reform law So far, the CMS has signed 243 providers to bundled-payment contracts, which began in October and January.

Read the full article here.

Contact Steven Cosby with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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IRS Issues Final Rule on the Individual Mandate

On August 27, the Internal Revenue Service (IRS) issued a final rule for the individual mandate provision of the Patient Protection and Affordable Care Act (PPACA).

As a reminder, the individual mandate requires most individuals to have minimum essential coverage in 2014 or pay a penalty. The penalty is called a shared responsibility payment. Some individuals may qualify for an exemption from the mandate so they will not be required to have coverage or pay a penalty. An individual seeking an exemption may do so in advance through an application submitted to the Exchange/Marketplace or after the fact with the IRS through the tax filing process. An applicant can apply for multiple exemptions simultaneously.

The final rule, which is largely consistent with the proposed regulations, confirms the following:

  • What qualifies as minimum essential coverage
  • What wasn’t addressed in regard to minimum essential coverage
  • Who is exempt from paying the penalty
  • How penalties will be determined and paid

Click here/a> to read full article.

Wellness Programs and Rewards Final Regulations

Final regulations on wellness programs and rewards for group health plans were issued on May 29, 2013 by the Departments of Treasury, Labor and Health and Human Services. These regulations apply to insured and self-insured group plans, both grandfathered and non-grandfathered, for plan years beginning on or after January 1, 2014.

Groom Law released their memo on Wellness and rewards programs.

The final regulations confirmed the maximum wellness reward amounts that will be allowed.

  • The maximum wellness program reward is 30 percent of the total cost of medical coverage, including both employer and employee contributions.
  • The maximum wellness program total reward may be increased to 50 percent for programs related to tobacco use.
  • Rewards can take many forms, such as premium discounts or surcharges, reduced cost sharing, enhanced benefits, gift cards or deposits to Health Savings Accounts or Health Reimbursement Accounts.
  • The reward must be available at least once per year for all similarly situated individuals.
  • If family members participate in wellness programs, the reward can be based on the total cost of coverage for all covered family members. If some family members are eligible for the reward and others are not, employers have flexibility in determining the portion of the reward attributable to each family member.

There are two types of Wellness Programs: Participatory and Health-Contingent

1. Participatory Wellness Programs

Any Participatory Wellness program reward is based only on participation, not on meeting specific health standards. Examples of these types of programs include health club discounts or rewards for completing a health assessment. There are no limits on the rewards for Participatory Wellness programs.

2. Health-Contingent Wellness Programs

Health-Contingent Wellness programs require individuals to meet a health standard or participate in a health program to receive a reward. Every individual eligible for the program must be given an opportunity to qualify for the reward once a year. The reward cannot exceed the maximum amounts noted above.

Health-Contingent programs may be Activity-Only programs or Outcome-Based programs.

i. Activity-Only Wellness Programs

  • Individuals are rewarded for completing a program such as a walking, diet or exercise program.
  • Individuals are not required to achieve a specific result such as losing weight to earn the reward.
  • A physician may provide verification that a medical condition makes it unreasonably difficult or medically inadvisable for a person to perform the activity.

ii. Outcome-Based Wellness Programs

  • Individuals are required to achieve a health outcome such as a specific blood pressure or BMI level to receive the reward.
  • Individuals who do not meet the required standard must take additional steps such as working with a health coach or completing a health improvement plan to receive the reward.
  • Physician verification that a medical condition makes it unreasonably difficult or medically inadvisable for a person to meet the standard is not permitted for Outcome-Based programs.

iii. Reasonable Alternative Standards

If an individual does not qualify for a Health-Contingent reward, a reasonable alternative standard or waiver must be available.

  • For Activity-Only programs, a reasonable alternative for obtaining the reward must be provided if it is unreasonably difficult due to a medical condition or medically inadvisable for an individual to attempt to complete the activity.
  • For Outcome-Based programs, a reasonable alternative must be provided to all individuals who do not meet the initial standard.

As an example, a reasonable alternative for an individual who failed to meet a BMI standard might be participation in a weight loss program or the requirement to reduce BMI by a small amount or percentage over a year’s time.

Any materials provided to employees that describe wellness programs must include information about the availability of reasonable alternatives and contact information to request an alternative. Reasonable alternatives do not need to be defined in advance and can be determined on an individual basis.