Acting CMS Administrator Kerry Weems told a House committee that for the first time the agency would conduct an analysis of the extra services that Medicare Advantage Plans enrollees actually use rather than just what the participating plans offer. Private insurers that make up Medicare Advantage often tout added benefits, such as coverage for hearing aids, eyeglasses and gym memberships, as the primary reason why they are paid on average 13% more than traditional fee-for-service Medicare. But the plans have never had to document how many beneficiaries actually take advantage of those extra services. The move follows a new report from government auditors that some Medicare Advantage beneficiaries are actually spending more for home-health services and hospitalizations than those in traditional Medicare.
Some Medicare dollars that go toward hospital payments in fiscal 2009 should be reallocated toward pay-for-performance efforts, the Medicare Payment Advisory Commission recommended in its March report to Congress. Congress should increase payment rates for inpatient and outpatient services at the full rate of inflation in fiscal 2009, which would amount to an increase of 3% to 3.5%, MedPAC Executive Director Mark Miller told reporters. About 1% to 2% of hospital paymentsan estimated $1 billionwould be withheld and redirected toward pay-for-performance, he said. Part of the funding for this policy would come from reducing the adjustment for teaching hospitals by 1 percentage point in fiscal 2009, Miller said. The commission also recommended that Congress increase Medicare physician payments in 2009 by 1.1%. However, in a letter dated Feb. 29 to MedPAC Chairman Glenn Hackbarth, Jeffrey Rich, director of the CMS Center for Medicare Management, wrote that physician payments are projected to drop a cumulative 15% in 2009 under the normal payment mechanism.
More than $371 million in improper Medicare payments were collected from or repaid to healthcare providers and suppliers in three states by recovery audit contractors in 2007, the CMS reported. The Recovery Audit Contractor demonstration program, created by the Medicare Prescription Drug Improvement and Modernization Act of 2003, identifies and corrects improper Medicare payments paid to healthcare providers participating in fee-for-service Medicare. CMS report said 96% of the improper payments identified by audit contractors in 2007 in California, Florida and New York were overpayments collected from healthcare providers. The rest were underpayments repaid to healthcare providers. Rep. Lois Capps (D-Calif.), who has legislation to place a one-year national moratorium on the RAC program, dismissed the agencys claims that the program is a success. I find these assertions curious when CMS officials admit there are serious problems with the way the RAC was conducted with regard to inpatient rehabilitation facilities, which make up 88% of the claims denied, she said in a written statement.
American Medical Association President Ronald Davis informed the AMA board that he has been diagnosed with pancreatic cancer. In June 2007, Davis, 51, was elected the second-youngest president in AMA history. The AMA said Davis will continue to serve as president though his activities will be curtailed as he begins immediate treatment, and other board members will assume some of his official duties. Davis has a page at carepages.com, to share information about his health and treatment. Davis is a preventive-medicine physician from East Lansing, Mich., and has been the director of the Detroit-based Henry Ford Health Systems Center for Health Promotion and Disease Prevention since 1995.
HHS Secretary Mike Leavitt agreed to hand over documents to the House Energy and Commerce Committee that were used to brief Food and Drug Administration Commissioner Andrew von Eschenbach at a hearing last year, avoiding the possibility of being held in contempt by Congress. In a Feb. 29 letter to Committee Chairman John Dingell (D-Mich.), Leavitt said the department was prepared to offer access to von Eschenbachs briefing book and related materials prepared for the March 2007 hearing, where von Eschenbach was accused of misleading members of Congress on the FDAs approval of the antibiotic drug Ketek. Leavitt said he would also make FDA staff accessible to discuss the contents of the briefing book and how it was prepared. A congressional investigation is under way on the agencys handling of the drug, which is manufactured by Sanofi-Aventis and was approved despite faulty clinical trials. The Energy and Commerce Committees Oversight and Investigations Subcommittee in January voted to subpoena von Eschenbachs briefing materials, although Leavitt had previously refused to comply. Energy and Commerce leaders had given Leavitt until close of business Feb. 29 to agree to a compromise on the subpoena, or face a potential motion holding him in contempt.
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