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Medicare Heads Up: September 4, 2020

A round-up of recent state and national headlines that matter to Medicare beneficiaries

Josh Schultz | September 4, 2020

Welcome to Medicare Heads Up, a regular round-up to deliver state and national Medicare-related headlines that will keep consumers abreast of developments that affect their coverage and costs. This week:

CMS proposes to pare back coverage of telehealth, audio-only visits after public emergency ends

On August 4, 2020, the Centers for Medicare and Medicaid Services (CMS) released proposed changes to Medicare physician payment rules for 2021 that would pare back Medicare’s coverage for telehealth and audio-only (e.g., telephone) visits once the public health emergency ends.

Medicare previously began covering 80 additional telehealth services and paying for telephone visits in response to the the coronavirus crisis.

Under the proposed rule, Medicare would stop paying for most of those telehealth visits and wouldn’t cover telephone visits when the public health emergency ends. But CMS is seeking comments on whether Medicare should cover a new type of audio-only visit that is similar to Medicare’s existing “virtual check-in” at that time.

CMS says Medicare will continue covering the additional telehealth services through the end of the year the public health emergency ends. The agency is also proposing for Medicare to cover some of the additional telehealth services on a permanent basis.

Medicare had required beneficiaries to have an in-person medical visit before being admitted to a skilled nursing facility (SNF), but it allowed those visits to occur via telehealth due to the coronavirus. CMS is also asking whether pre-admission visits should continue occurring using telehealth once the public health emergency ends.

Medicare will cover more surgeries in outpatient settings starting in 2021

CMS is proposing to end Medicare’s requirement that many surgeries occur as inpatient procedures by 2024. Medicare would begin this process by paying for 300 musculoskeletal procedures next year for beneficiaries who haven’t been admitted to the hospital.

Medicare beneficiaries could still receive the procedures in question as hospital inpatients if that was medically indicated, but Medicare would also cover these surgeries for outpatients.

CMS also intends for Medicare to begin covering 270 surgical procedures – including total hip arthroplasty – when they are received at ambulatory surgical centers (ASCs). Those surgeries previously had to occur in hospitals.

Overall costs for medical procedures are lower when they’re received on an outpatient basis rather than as an inpatient. And costs for beneficiaries are usually lowest at an ASC, because Medicare reimburses ASCs at 53 percent of the rate it pays for procedures at hospital outpatient departments.

Original Medicare beneficiaries pay a 20 percent coinsurance for Part B services after meeting a $198 deductible, and pay a $1,408 Part A deductible for each benefit period of inpatient hospital care. The most popular Medigap plan available to new enrollees – Plan G – covers these costs other than the Part B deductible.

CMS proposes automatic Medicare coverage for FDA ‘breakthrough’ device approvals

CMS is proposing for Medicare to automatically cover medical devices designated by the Food and Drug Administration (FDA) as having “breakthrough” status once they are FDA approved. These breakthrough medical devices receive faster consideration by the FDA because they offer an improved treatment option for a serious condition and meet a second criteria, such as offering a treatment option when none currently exists.

Sixteen different regional contractors currently decide whether Medicare covers new treatments and devices, which means coverage rules can vary geographically. CMS sometimes also grants Medicare coverage on a nationwide basis – by issuing a National Coverage Determination (NCD).

But issuing an NCD can take nine to 12 months, which can delay Medicare’s coverage for new devices. Under this proposal, Medicare would issue NCDs automatically for all newly FDA approved breakthrough devices.

Medicare would also issue NCDs for breakthrough medical devices approved in 2019 and 2020 under the proposal.

CMS wants to consider commercial insurance coverage when making Medicare payment decisions

CMS is proposing for Medicare to consider whether commercial insurers cover a service or treatment when deciding if that service will be covered by Medicare. The agency would also formalize criteria for whether Medicare considers a health care service “reasonable and necessary” for the treatment of illness or injury in the same regulation.

Medicare often covers medical services or treatments before commercial insurers begin covering them. But sometimes commercial insurers cover treatments before Medicare does.

The federal government and Medicare contractors would use this new commercial insurance standard when deciding whether Medicare will cover a health care service or device.

Medicare’s current standard for whether it will cover health care services or devices requires them to be safe and effective, not experimental or investigational, and appropriate use in the Medicare population. The proposed regulation would generally consider commercial insurers covering an item or service as evidence that it is appropriate for Medicare patients.

CMS says this change is consistent with an executive order President Trump issued in 2019 directing CMS to make technologies “widely available, consistent with the principles of patient safety, market-based policies, and value for patients.”

Josh Schultz has a strong background in Medicare and the Affordable Care Act. He coordinated a Medicare technical assistance contract at the Medicare Rights Center in New York City, and represented clients in extensive Medicare claims and appeals. In addition to advocacy work, Josh helped implement federal and state health insurance exchanges at the technology firm hCentive. He also has held consulting roles, including as an associate at Sachs Policy Group, where he worked with insurer, hospital and technology clients on Medicare and Medicaid issues.

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