CMS Cuts Medicare Pay, AHA Sues HHS on Tracking Technology Policy

November 09, 2023 - In its calendar year (CY) 2024 Medicare Physician Fee Schedule (PFS), CMS announced it will slash Medicare payments by 1.25 percent. Primary care and direct patient care providers received an increase in pay while other specialties will take a decrease to maintain budget neutrality.

The American Hospitals Association (AHA) took legal action after a December 2022 bulletin from the Department of Health and Human Services's Office for Civil Rights restricted HIPAA-regulated entities from using tracking technologies when patient health information is implicated. AHA claims that HHS has overstepped its authority and failed to consult providers about the decision.

Meanwhile, a study on drug-related hospital or ED visits exemplified how EHR data can be used to monitor and intervene in at-risk populations. And finally, Walmart Health's partnerships with provider and payer organizations continue the retailer's foray into healthcare.

Kyle Murphy:

Welcome to Healthcare Strategies | Headlines edition. Today's episode:

• CMS cuts Medicare pay for docs
• Hospitals take feds to court
• EHR data can help drug use monitoring efforts
• Walmart Health dips its toes into care management

This is Kyle Murphy, vice president of editorial, Xtelligent Healthcare Media, and I am joined by the one, the only, Kelsey Waddill.

Kelsey Waddill:

Hello.

Kyle Murphy:

How are you?

Kelsey Waddill:

I'm good.

Kyle Murphy:

Question for you.

Kelsey Waddill:

Yeah.

Kyle Murphy:

It's daylight savings week. It's the week that everyone turns to darkness and realizes that darkness is not the old friend that Simon and Garfunkel we're always talking about. Was it darkness? Your thoughts on daylight savings? For or against it, indifferent?

Kelsey Waddill:

Against it.

Kyle Murphy:

I'll tell you, as a person with SADS and a person with children, going to bed, going to bed at like seven o'clock, thinking about it's eight o'clock actually felt really, really great. I got an extra hour of sleep and I'm rolling with it.

Kelsey Waddill:

See, that's why I always go back and forth because I am against it in the spring when you have to jump forward. But in the fall, it's actually pretty nice.

Kyle Murphy:

And I think it's good for moon worshipers. You get just more darkness. You get to just see it and all its splendor. It's about time. Worship the moon.

Kelsey Waddill:

I didn't think about that population. That's true. Underrepresented.

Kyle Murphy:

They're underserved. They're underserved. Alright, let's get into today's headlines.

CMS cuts, Medicare pay for docs.

The Centers for Medicare and Medicaid Services [CMS] announced a 1.25 percent reduction in payments to Medicare providers for 2024. Kelsey, you and I both know, that just means that private insurance is going to have to pick up more of the slack.

This adjustment was detailed in the recent Medicare Physician Fee Schedule final rule for the year. The 2024 conversion factor--whatever the hell that is--which is used to calculate reimbursement rates, is 3.4 percent lower than that of 2023. Despite opposition from major medical associations--we all know who they are--this reduction was anticipated, as it was proposed in 2023, and has now been confirmed in the final rule.

CMS has highlighted additional services that Medicare will cover--so they're paying less for more--including new navigation services for patients with complex needs, payments for caregiver training, and additional codes for costs related to evaluation and management visits in primary and long-term care, E/M. The American Medical Association [AMA] criticized the final rule stating it perpetuates a trend that jeopardizes the sustainability of Medicare for patients and physicians.

Kelsey, there's a unique relationship between Medicare reimbursement levels and private payer or employee costs. How might this reduction affect other stakeholders?

Kelsey Waddill:

Yeah. As you alluded in your speech there, the private payers often end up picking up the slack for... quote-unquote, "picking up the slack," for whatever Medicare isn't going to cover, and so it's definitely something that employers, I think, are going to be looking at closely, especially as they base a lot of their benchmark on the Medicare rates. I could see employers going, "Well, Medicare's paying less. We should be paying less." And then providers saying, "Medicare's paying less, you should be paying more." So I think there's going to be some tension between those two.

Kyle Murphy:

Yeah, you and I were in the same room at the HLTH conference when we heard that for, like, 70 cents on the dollar Medicare, versus $2.50 cents [for every Medicare dollar] for private insurance. So it's like, okay, cool. How about we just maybe propose a system where we just have kind of a flat fee service for everything. I don't know, universal healthcare, that's rogue. Something like that. Wow. I became a socialist. Well, it's November. It's daylight savings. I'm affected. Wow.

Kelsey Waddill:

I had not heard of that side effect, but...

Kyle Murphy:

No, no, never.

Kelsey Waddill:

Speaking of hospitals, the American Hospital Association, along with...which, by the way, was one of the people who was not so happy about that Medicare cut--

Kyle Murphy:

Shocked.

Kelsey Waddill:

Yeah.

...along with three other healthcare organizations, are suing the Department of Health and Human Services, also known as HHS. AHA is challenging a December 2022 guidance from the Office for Civil Rights (OCR) which limits the use of online tracking technologies by HIPAA-covered entities and their business associates to safeguard patient health information (PHI) from potential HIPAA violations. The contested guidance forbids tracking technologies on websites with PHI access, even those requiring user authentification. The AHA argues that HHS overstepped its authority without proper rulemaking and failed to consult healthcare providers before issuing the guidance. The AHA had previously attempted to engage with HHS on this issue without success, prompting the lawsuit.

Kyle, I'm really interested to hear your take on this. It does seem to me that HHS is in a bit of a tough position. How do we incentivize innovation and then use all of these helpful data sharing programs and tools, but also protect patient data, which can be so vulnerable? Is there a middle ground here?

Kyle Murphy:

I think it's dicey. This being America, there's a lot of individuality and privacy around that. I just have issues with--because I've been using the internet since, I think since it's been around forever, since this was dial up, and the fact is that we're being tracked by absolutely everything. Our service provider is tracking us, the websites are tracking us, but we as consumers don't actually have a say in how that information is used or, in some cases, monetized. Yes, I would love to believe that hospitals and providers are doing things for altruistic reasons, but why should I believe that when there's been a rather troubling history of information being used against the will of certain people, and it's been used to target certain people? So I'm just nervous there. I don't think that there should be tracking mechanisms. If things like this need to occur, then let's think about portals and secure HIPAA-compliant ways of doing it. Let's not rely on websites and forms of technology that people don't fully understand and don't really appreciate what they sacrifice in the name of access.

Kelsey Waddill:

Yeah, good points.

Kyle Murphy:

Thank you very much. I appreciate it. Now let's get on the next one.

So, EHR data can help drug-use monitoring efforts.

Researchers analyzing hospital and emergency department visits for methamphetamine and opioid incidents in Hennepin County, Minnesota, have developed a data system to assess drug intervention efficacy, particularly for groups with higher rates of drug-related visits. Findings shared in Health Affairs showed that Black, multiple-race, and Native American individuals were more likely to have drug-involved hospital and emergency department visits compared to other racial and ethnic groups in the study. In 2022 and 2023, more than 14 Native Americans out of every 100 who visited the ED were there for drug-related reasons. In contrast, four White people out of every 100 visited for drug-related reasons.

This monitoring helps public health officials recognize trends and craft targeted early interventions to help advance health equity. We know that integrating social service data can also help identify individuals at high risk of drug overdose, enabling interventions that could have adverse outcomes. While the study focused on a single county--yes, one single county--its methodologies could be expanded to state or national levels.

So, Kelsey, these findings are insightful. We all know about the opioid epidemic. The healthcare system clearly needs more data to quantify substance use and to form behavioral health interventions. What are your thoughts on just the overall fact that this is just a stepping stone in a direction towards collecting more information?

Kelsey Waddill:

Yeah, I think it kind of does go back to what we were talking about, patient health information and data sharing, earlier. Although there are risks associated with that, this is an example of where this data is actually really important to helping public health officials understand what the landscape is and who needs the most help right now and where these interventions are most needed and who needs outreach to know what kinds of interventions are available. I think that, like you said, this is a stepping stone. This is, as was highlighted, one county that evidently expressed similar patterns to national data. So it does provide some insight and some, maybe, hope for how this data could be useful elsewhere. Maybe sort of like a pilot, one might say.

Kyle Murphy:

I would say I still haven't seen any data in the sense of how these interventions should take place. Does this mean that healthcare workers go out into the community and they become first responders to this? Because we all know about the war on drugs, the unsuccessful war on drugs, and how that has created divisions, societal divisions, and certain communities feel marginalized and rightfully so. I would be mindful, or I'd be cognizant of the fact that this probably needs to inform how it is we respond and what it is we do to prevent this drug use, these drug overdoses from leading to adverse outcomes, but also ensuring that there's some kind of safety net for people to fall back into, to then have a road to recovery. Because the overdoses that end up presenting in the [emergency department] ED is just one side of the coin. So there's obviously a lot more that has to be done and can't really just stop at that point. But I mean, this is a huge topic. There's no way we're going to resolve it in this little podcast.

Kelsey Waddill:

Really? I thought that we were going to be able to handle that, Kyle. I don't know.

Kyle Murphy:

Tackling the big things in 15 minutes. You know what?

Kelsey Waddill:

We're finding our limits.

Alright. Walmart Health announces--on a totally different topic--Walmart Health announces two Florida partnerships.

Walmart Health is partnering with two organizations to help its patient engagement and care coordination capabilities. The retailer will join forces with Orlando Health, a private non-for-profit network of community and specialty hospitals, to improve transitions of care between Walmart Health and Orlando Health. This gets sort of at a comment that you made on the podcast earlier in the season, Kyle, about fragmentation due to retail clinic use. So Walmart's solution to this is apparently to partner directly with a provider, which at least solves the problem for Orlando Health patients. Orlando Health serves approximately 2 million people in Central Florida, which...

Kyle Murphy:

That's sizable.

Kelsey Waddill:

... is not an insignificant number, yeah.

So Walmart Health didn't stop with provider collaboration, though. It also will be working with Ambetter from Sunshine Health, which is a Florida health insurance marketplace health plan, and the plan falls under the Centene Corporation. Walmart leadership said that this partnership is going to help members of this plan in locations adjacent to Walmart Supercenters. There are 23 Walmart health clinics in Florida that offer services such as primary care labs and behavioral healthcare services.

So Kyle, what do you think of this solution to your question from a couple of episodes ago?

Kyle Murphy:

I think this is what happens when--I don't want to really pat capitalism on the back, but--in a fair market where you see these massively important community organizations or just these organizations that are pretty much the go-to location in your neighborhood, that maybe they just get tired of seeing all the fragmentation. They start getting tired of seeing things not happening, and they realize that in order for your economy to thrive, your people need to thrive. So it makes a lot of sense that you would invest in it. And if you've got that pull and sway that Walmart does across the country, I think you could bring people to the table, the other organizations, and say, "Hey, we need to do something," and they're probably going to listen to you a whole lot more.

Kelsey Waddill:

Yeah. Yeah. I have friends who will drive 30 minutes out of their way to get to a Walmart around here.

Kyle Murphy:

It's incredible. I'll tell you, there are certain parts of the country that I don't think would exist without a Walmart, so it's something good for people. I know we talk about access a lot, but some of these large grocery stores, retail chains are filling the void that the healthcare system has kind of left behind in certain communities. So I don't think we should really shrug our shoulders at that. This is a step in the right direction, and like you said, 2 million people to be impacted positively by this. So it's a start. Is it the solution? Don't know. We'll have to see how things play out over time, but I will say that any step towards getting people healthcare is probably better than no step at all.

Kelsey Waddill:

Yeah, yeah.

Kyle Murphy:

We always end this on a high note. I'm always positive-

Kelsey Waddill:

I know.

Kyle Murphy:

... about these things. Do you want to sign it off today?

Kelsey Waddill:

All right. Well, that's it for Healthcare Strategies | Headlines today.

Kyle Murphy:

Take care everyone.

Kelsey Waddill:

Bye.