Update on Therapy Caps & Physician Fee Schedule [02-11-10]

Filed under: Industry Updates — Editor @ 3:07 pm

On February 9, 2010, Senate Democrats released their jobs creation bill, the “Hiring Incentives to Restore Employment Act,” a package of provisions designed to stimulate the economy and help reduce unemployment. Of particular note to rehabilitation providers, however, is a provision in Title IV of the bill which would extend the physician fee schedule until September 30, 2010 and extend the exceptions process for the outpatient therapy caps until December 31, 2010. Senate Majority Leader Harry Reid (D-NV) had initially hoped that the Senate would begin considering amendments to the bill this weekend, but extreme winter conditions this week have virtually shut down Washington, D.C. At this point, the Senate plans on reconvening on February 11 but many Senators have not been able to return to Washington, DC, making votes unlikely for the rest of this week. Reid vowed “[d]espite the storm, we are going to make progress on the jobs bill.” Moreover, this weekend will mark the beginning of the President Day’s Recess, meaning that the Senate would not begin voting on the package until the week of February 22 at the earliest. This timing is important on February 28, the short-term delay for the scheduled 21% decrease in Medicare reimbursement rates for doctors will expire.

After the swearing in of Senator Scott Brown (R-MA), Senate Democrats will need the votes of some Senate Republicans to pass the bill, meaning that the bill may undergo significant changes during floor consideration. At present, Senate Republicans indicated that they needed more time to assess the “Hiring Incentives to Restore Employment Act” and its provisions before taking a position on the legislation. Senate Minority Leader Mitch McConnell (R-KY) stated that “Finance [Committee] Republicans are not entirely comfortable with it and the rest of our conference doesn’t know what’s in it.”  He added that “[w]e’re in the process of trying to get our people up to speed on what is in the bill and then we can make an intelligent decision about how much enthusiasm there is for it.”

Even in the event that the Senate quickly enacts the bill containing the provisions of interest to rehabilitation providers, the House and Senate must negotiate on a final bill. The House passed its jobs package, the “Jobs for Main Street Act of 2010” (H.R. 2847) on December 16, 2009, which did not contain language on either the physician fee schedule or the exceptions process for therapy caps. Any differences between the two bills would need to be harmonized and the issue of whether to include the health care extenders would have to be resolved.

However, even if the final jobs bill includes the Senate provisions on the physician fee schedule and the exceptions process for therapy caps, action would still be needed to ensure long-term fixes. With respect to the physician fee schedule, the Congress cleared a significant hurdle on February 4 when the House of Representatives passed H.J.Res. 45 by a 233-187 vote, which would increase of the nation’s debt limit by $2 trillion dollars and reinstate Pay-Go budgetary rules for Congress, requiring that all new spending would need a corresponding increase in revenue or cut in spending elsewhere in the budget. However, a number of programs were exempted from the Paygo rules, including the physician fee schedule, meaning that Congress would not have to raise taxes or cut funding for another program to implement a fix. This does not mean, however, that Congress will agree to fix the fee schedule without paying for it. In addition, at this time there is no agreement on how to fix it.

Additionally, two bills recently introduced by Senator John Ensign (R-NV) would institute longer-term extensions for the therapy caps extension process. On February 4th, Sen. Ensign introduced two bills the first of which, S. 2987, would provide for a one year extension at an estimated cost of $400 billion, and the second of which, S. 2988, would extend the process for two years at an estimated cost of $1 billion. As of yet, neither bill has been taken up by the Senate Finance Committee.

Steps are being taken with respect to the re-implementation of therapy caps. On February 2, Senators Ensign, Blanche Lincoln (D-AR) and Charles Grassley (R-IA) sent a letter to Secretary of Health and Human Services Kathleen Sebelius requesting that HHS implement an administrative delay for the implementation of the therapy caps. They expressed concern that the caps are “causing undue hardship on Medicare beneficiaries” and reported hearing from beneficiaries with “severe rehabilitation needs” have already exceeded the cap. They commended HHS for issuing a memorandum directing providers to hold claims in order to see if legislation re-implementing the exceptions process is passed. Senators Ensign, Lincoln and Grassley pointed out, however, that many providers cannot simply hold claims.

From The National Association of Rehabilitation Providers & Agencies.  Marden Supports NARA.

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