RISE summarizes this week’s regulatory news.
Supreme Court sides with insurer on outpatient dialysis coverage
The Supreme Court on Tuesday rejected a claim by DaVita Inc., one of the largest dialysis providers in the country, that a group health plan violated the Medicare Secondary Payer Act by offering limited coverage for outpatient dialysis.
The High Court ruled 7-2 that the Marietta Memorial Hospital’s employee health plan doesn’t discriminate against patients with end-stage renal disease (ESRD) because it offers the same level of coverage for all patients with kidney disease. DaVita filed a lawsuit in 2018, claiming that the plan violated federal law by discriminating against patients based on their need for dialysis, covering dialysis providers as out of network and reimbursing them at lower rates.
The ruling, written by Justice Brett Kavanaugh, reverses a decision by the 6th U.S. Circuit Court of Appeals, which had found the health plan violated the Medicare Secondary Payer Act by discriminating against ESRD patients. The statute provisions simply coordinates payments between group health plans and Medicare, he wrote, adding that the statute doesn’t dictate any particular level of dialysis coverage. Justices Elena Kagan and Sonia Sotomayor dissented.
“Neither the statute nor DaVita offers a basis for determining when coverage for outpatient dialysis could be considered inadequate,” Kavanaugh wrote in the majority opinion. “And neither the statute nor DaVita supplies an objective benchmark or comparator against which to measure a plan’s coverage for outpatient dialysis.”
The Marietta Plan, he wrote, provides the same outpatient dialysis benefits to all plan members, whether the participant is entitled to or eligible for Medicare.
Kidney Care Partners, the country’s largest non-profit, non-partisan coalition of more than 30 organizations, said it was deeply disappointed by the ruling. “The insurer practice at issue–shifting patients prematurely to Medicare–will exacerbate inequalities in access and quality care for an already vulnerable population,” John P. Butler, chair of Kidney Care Partners, said in a statement. “This ruling is a blow to promoting affordable patient choice and instead unfairly shifts costs to the American taxpayer. We feel this decision leaves patients with ESRD vulnerable to discriminatory and inequitable insurer practices, and in fact, is not consistent with the administration’s own goals on health equity.”
CMS proposes rule to update payment rates, policies under ESRD for renal dialysis services
The Centers for Medicare & Medicaid Services (CMS) on Tuesday issued a proposed rule that would update payment rates and policies under the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) for renal dialysis services on or after January 1, 2023. It also proposes to update the Acute Kidney Injury (AKI) dialysis payment rate for renal dialysis services.
CMS also is seeking feedback on proposals for a potential add-on payment adjustment for certain new renal dialysis drugs and biological products and health equity issues under the ESRD PPS, with a focus on pediatric dialysis payment.
Among the proposals:
- Rebase and revise ESRD bundled market basket to a 2020 base year and update the labor-related share
- Change ESRD PPS methodology for calculating the outlier threshold for adult patients
- Apply a permanent 5 percent cap on decreases in the ESRD PPS wage index and increase the wage index floor
- Change definition of “oral-only drug” beginning January 1, 2025 and clarify ESRD PPS functional category definitions
- Update requirements and input requests for the ESRD Quality Incentive Program
CMS calls for feedback on Home Health PPS proposed rule by August 16
Medicare payments to home health agencies next year would decrease by as much as $810 million under 2023 Home Health PPS Rate Update proposed rule. CMS said in a fact sheet that the payments would decrease in the aggregate by 4.2 percent due to the proposed 2.9 percent home health payment update percentage, a $560 million increase; an estimated 6.9 percent decrease that reflects the effects of the proposed prospective, permanent behavioral assumption adjustment of -7.69 percent; and an estimated 0.2 percent decrease that reflects the effects of a proposed update to the fixed-dollar loss ration used in determining outlier payment.
The proposed rule also includes:
- A permanent 5 percent cap on negative wage index changes for home health agencies
- Requests for input on how best to implement a temporary payment adjustment for CYs 2020 and 2021 and collecting telehealth data on home health claims
- Request for feedback on health equity measure development for the home health quality reporting program and the potential future application of health equity in the expanded value-based purchasing model’s scoring and payment methodologies
DOJ announces $4.6M settlement with Molina Health over False Claims Act violations
The Justice Department announced that Molina Healthcare has agreed to pay $4.625 million to settle allegations that it violated the False Claims Act by submitting reimbursement claims while violating several regulations related to the licensure and supervision of staff.
Molina provides health care plans to various state and federal health care programs including MassHealth, the joint federal and state Medicaid program. The Department of Justice (DOJ) said that between November 2015 and March 2018, Molina owned and operated Pathways, a group of mental health centers located in Springfield and Worcester, Mass. During that period, the DOJ said Molina and Pathways improperly submitted claims for reimbursement to MassHealth and care entities managed by MassHealth while failing to properly license and supervise mental health center staff, including social workers and psychological associates, and failing to provide and timely document the provision of adequate clinical supervision to clinicians requiring supervision.