2% Medicare Cuts, Part of Sequestration, Began on April 1

The 2 percent cut to Medicare payments that are part of sequestration took effect on Monday.

As a result of the cut, providers will be reimbursed 98 cents on the dollar for Medicare fee-for-service claims with dates of services or dates of discharge on or after April 1, 2013. The payment adjustment will be applied to all claims after determining coinsurance, any applicable deductible and any applicable Medicare Secondary Payment adjustments.

The impact will begin to be evident in mid-April. The payment reductions are on track to cost skilled nursing facilities about $782.5 million in fiscal year 2014.

Federal Gov't. Will Pay 100 Percent of Medicaid Costs for Certain Newly Eligible Individuals

On Friday, the Department of Health and Human Services, of which CMS is a division, announced that the federal government will pay 100 percent of the Medicaid costs for certain newly eligible beneficiaries as part of the Affordable Care Act (ACA).

The 100 percent funding will only last through 2016, when it will gradually begin to decrease. By 2020, it will be at a permanent 90 percent.

Under the Affordable Care Act, states were given the option of expanding Medicaid coverage to people under the age of 65 who are earning up to 133 percent of the federal poverty level.

The federal government will also include the Federal Medical Assistance Percentages (FMAP) rate for certain beneficiaries in states that expanded Medicaid coverage before the ACA was passed in 2010.

To learn more, click here.

With Deadline Approaching, Only 15 States Plan to Set Up Healthcare Exchanges

States have until tomorrow to notify the federal government of whether they plan to operate health insurance exchanges, a key provision of President Obama's healthcare reform law. So far, only 15 states are planning to do so, but that number is expected to rise to 18. This means that the government will be left to set up exchanges in at least 30 states.

The exchanges would allow individuals to purchase private coverage from online exchanges at federally subsidized rates. The administration in planning on beginning to enroll families via the exchanges beginning October 1, 2013. The insurance coverage would begin on January 1 of 2014.

According to the Congressional Budget Office, the administration estimates that approximately 26 million people will eventually purchase coverage through the exchanges.

To learn more, click here.

Medicare Hospital Readmission Fines Begin Today

Beginning today, Medicare will start to fine nearly two-thirds of hospitals that have high numbers of patients readmitted within 30 days for heart attacks, heart failure and pneumonia. On average, the penalties will costs hospitals about $125,000 a year.

The fines are currently capped at 1 percent of a hospital's Medicare payments for the first year, but they will eventually rise to 3 percent under the Affordable Care Act.

To learn more, click here.

CMS: ACA Medicaid Expansion "Truly Voluntary"

A CMS official has explained that Medicaid expansion under the Affordable Care Act will be "truly voluntary."

According to Cindy Mann, director of CMS' Center for Medicaid and Children's Health Insurance Program, states can sign up to expand Medicaid as early as January 2014 or at any point after that and they can exit the program if they are unhappy with it. The Affordable Care Act calls for states to extend eligibility to people with incomes of up to 133 percent above the federal poverty level.

Mann also said that while there is no Medicaid implementation deadline, states would miss out on federal funds the longer they choose to wait.

To learn more, click here.

Sebelius: States Can Opt Out of Medicaid Expansion, But Can't Tighten Medicaid Eligibillity

Health and Human Services Secretary Kathleen Sebelius is reminding state governors that although they can choose to opt out of the Affordable Care Act's Medicaid expansion, they still can't tighten current Medicaid eligibility requirements.

Sebelius added that low-income residents in states that elect not to participate in Medicaid expansion will not face federal penalties for not having health insurance. Instead, they will receive a "hardship" waiver from the ACA's individual mandate provision. 

To read Sebelius's letter to state governors, click here. 

Seven States Already Rejecting ACA Medicaid Expansion

A week after the Supreme Court upheld the Affordable Care Act, AKA "Obamacare," at least seven governors have indicated that they will not participate in the Medicaid expansion called for under the law.

The Supreme Court struck down the provision of the law that called for states to increase their Medicaid rolls or risk being penalized by the federal government. Governors still have a financial incentive to participate, since the government will be footing the bill for most of the bill through 2016.

The seven states whose governors have indicated that they will not take part in the Medicaid expansion are:

1. Florida
2. Iowa
3. Kansas
4. Louisiana
5. Nebraska
6. South Carolina
7. Wisconsin 

States that are undecided but appear to be leaning toward "no" include Alabama, Georgia, Indiana, Mississippi, Missouri, Nevada, Texas and Virginia. 

How Will "Obamacare" Affect Your State?

Now that the Supreme Court has upheld the Affordable Care Act, AKA "Obamacare," what comes next? Healthcare.gov (a website created by the U.S. Department of Health & Human Services) has added a section to their site titled "The Health Care Law & You." In this section, you'll find implementation resources and a state-by-state breakdown of how the new law will affect people across the country. It's packed with valuable information and we encourage you to check it out!

Supreme Court Rules in Favor of "Obamacare"

This morning, the Supreme Court upheld the controversial Affordable Care Act, or "Obamacare." CNN is providing continually updated coverage of the decision. To read the latest, click here. 


Here's a brief overview of the key points in today's decision:

• The SCOTUS ruled 5-4 to uphold the individual mandate (Justices Roberts, Ginsburg, Sotomayor, Kagan and Breyer ruled in favor of upholding the law. Justices Kennedy, Alito, Thomas and Scalia were against it). Chief Justice Roberts was the swing vote.  
• They ruled that the requirement to have insurance is a tax, and therefore is constitutional (the requirement had previously been challenged under the Commerce Clause, which Chief Justice Roberts wrote in his opinion did not apply). According to Roberts’ majority opinion: “It is reasonable to construe what Congress has done as increasing taxes on those who have a certain amount of income, but choose to go without insurance. Such legislation is within Congress’ power to tax.”
• The federal government may not take Medicaid funds from the states that refuse to take part in the ACA. (This is a limited ruling – in its opinion, the SCOTUS offered the government a way to remedy this potential problem. Basically, they didn’t strike down the federal government’s right to force states to expand their share of Medicaid costs and administration, but they’re acknowledging that there’s going to be a fight.)
•   Perhaps the biggest take-away: The SCOTUS has affirmed that the President and Congress have power to regulate an important issue like health care.
•  Interestingly, the opinion notes that the SCOTUS “Does not express any opinion on the wisdom of the Affordable Care Act.”

No "Obamacare" Decision Yet; Expected Next Week

The U.S. Supreme Court justices released their latest set of decisions today - but a ruling on "Obamacare" wasn't among them.

With next Thursday, June 28, being the last day of the Supreme Court's current session, legal and political communities are expecting a ruling any day. It's anticipated that the justices will hand down additional decisions this Thursday as well as Monday and Thursday of next week.

Historically, the court has saved its most controversial and momentous rulings for the final day of the term. Many anticipate that "Obamacare" will follow that pattern.

Medicaid Fraud Detection Program Comes Up Short

According to a Government Accountability Office investigation, the federal program tasked with detecting Medicaid fraud costs more to operate than it has recovered in overpayments.

Since 2008, the Medicaid audit program has cost $102 million to operate and only identified $7.4 million million in overpayments. The report characterized close to two-thirds of the 1,550 audits of state records as "unproductive."

Click here to read the GAO report.

Affordable Care Act to Fund Aging and Disability Resource Centers

The Affordable Care Act, AKA "Obamacare," has designated $52 million to help keep seniors, disabled individuals and veterans in their homes rather than long-term care facilities.

The funds will be used to establish Aging and Disability Resource Centers (ARDCs), which are meant to be a "one-stop shop" for elderly and disabled people who would like to receive care in their homes and communities rather than enter a facility. The ARDCs will provide counseling services for those looking for access to services such as:

• Transportation to rehabilitation therapy
• Home health 
• Support with activities of daily living 

In addition, the Veterans Health Administration will contribute $27 million over three years to help disabled veterans in ARDC-funded states remain in their homes.

To learn more, click here.

Healthcare Law Saves Medicare Recipients $3.5 Billion in Prescription Drugs

According to data released by CMS, the new healthcare law (the Affordable Care Act) saved seniors and people with disabilities $3.5 billion on prescription drugs since 2010. In the first four months of 2012 alone, more than 416,000 people saved an average of $724 on prescriptions drugs purchased after they hit the "donut hole," or prescription drug coverage gap.

Additionally, from January through April, 12.1 people in traditional Medicare received at least one preventive service at no cost.

To learn more, click here.

Day 2 of Supreme Court "ObamaCare" Hearing: What to Expect

Today is arguably the biggest day of the three days the Supreme Court has set aside to hear arguments on "ObamaCare." MSNBC put it this way: "The outcome of Tuesday's argument could demolish the entire law or cement it for decades to come."

At the center of the debate is the question that has plagued ObamaCare since it was introduced: Does Congress have the power to force individuals to purchase health care, a product they otherwise would not have purchased? It's anticipated that the two sides will focus on the extent of Congress's reach under their power to regulate interstate commerce.

Paul Clement, who is arguing on behalf of the states, said in his brief that "the Commerce Clause does not grant Congress the power to compel individuals to enter into commerce."

Solicitor General Donald Verrilli, who is representing the Obama administration, countered in his brief that the minimum coverage provision (which would require individuals to purchase insurance) "regulates economic activity that substantially affects interstate commerce. Its links to interstate commerce are tangible, direct and strong. It is therefore well within the established scope of Congress's power."

To follow along with the arguments, click here.

Supreme Court Takes Up "ObamaCare"

The eyes of America will be on the Supreme Court this week as the justices begin hearing arguments on the constitutionality of "ObamaCare." Here's what's expected to happen:

• Today (Monday) is the first of three days of oral arguments. The justices will hear 90 minutes of arguments over whether the Anti-Injunction Act (an obscure 19th century law) means that the court can't pass judgment on a law until its key provisions go into effect, which would happen in 2014. (Both sides agree that the issue should be settled now.)
• Tomorrow, the justices will hear arguments about the constitutionality of the individual mandate (requiring all Americans to purchase health insurance).
• On Wednesday, they will discuss whether "ObamaCare" can still exist if the individual mandate is found to unconstitutional (this is the so-called "severability" issue). They'll also look at whether the federal government can force states to increase Medicaid spending.

The court's decision could have incredible ramifications, with the Wall Street Journal noting, "In taking up President Barack Obama's health overhaul Monday, the Supreme Court wades into an issue that not only could sway this fall's elections but also could help define for generations what Congress is and isn't entitled to do."

To follow along with the proceedings, click here.

CLASS Act Pushed Back to 2013

A much-debated component of the new healthcare law, the Community Living Assistance Services and Supports Act, or CLASS Act, has been pushed back a year, to 2013.

The CLASS Act is the first federally backed long-term care insurance option for elderly and disabled individuals. It has been championed by provider groups such as LeadingAge, but it has also become a target during deficit reduction negotiations.

The program was originally slated to begin collecting premiums in 2012. That date has now been pushed back to 2013 based on the pace of implementation actions taken so far.

To learn more, click here.

CMS: Physicans Must Meet with Those Seeking Hospice, Home Health Certification

CMS has begun to implement a new law that requires physicians to meet face-to-face with individuals who are seeking to become certified for Medicare home health and hospice services. The law, part of the Affordable Care Act, technically went into effect on January 1, but CMS granted struggling agencies more time to adjust to adjust to the new requirements.

Physicians who make certification decisions are now required to provide documentation that states they met with the patient in person. For home health, this must happen within 90 days before the start of care or 30 days after the start of care. Hospice physicians or nurse practitioners must meet with a hospice patient prior to the patient's 180-days recertification and for each subsequent recertification. This must happen no more than 30 days prior to the start of the hospice patient's third benefit period.

To learn more, click here.

Ohio Allows Healthcare Reform Suit to Go to Trial

An Ohio federal judge has allowed a lawsuit challenging the insurance mandate of the new healthcare law to proceed to trial. His decision follows a similar ruling by a federal judge in Florida.

The suit alleges that the mandate violates the Commerce Clause in the Constitution.

To learn more, click here.

Don't Panic - Medicare Part D Drug Discounts are Still Happening

Vice President Joe Biden and HHS Secretary Kathleen Sebelius are pooh-poohing a rumor that drug makers will be hiking their prices in the coming months to offset the new healthcare law's plan to offer a 50% discount to those who fall into the Medicare Part D "doughnut hole."

During a call with senior citizens on Thursday, Biden and Sebelius stressed that as part of the healthcare law, the government struck a deal with pharmaceutical companies to begin lowering the price of drugs, effective 2011. The 50 percent discount on brand-name prescription drugs is the second phase of the Obama administration's plan to close to doughnut hole by 2020.

Sebelius added that the savings on drugs will continue even after the gap is closed.

To learn more, click here.

Survey Says: Seniors Confused about New Healthcare Law

Truthfully, this news isn't surprising, given that many Americans in general find the new healthcare bill confusing! A new survey from the National Council on Aging (NCOA) found that most seniors are either misinformed or simply unaware of how the new healthcare law will affect them.

The NCOA asked 636 seniors a series of 12 questions about Medicare, the budget deficit and other healthcare reform topics. Only 17% of the seniors knew the correct answers to more than half of the questions, and just 9% answered at least two-thirds of the questions correctly. None of the survey participants knew the correct answers to all of the questions.

For additional information, click here.