Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management.
"HCC's services are designed to provide a customized solution".
Managing Director and President - David J. Lacasse has more than 11 years of experience in asset based lending, healthcare finance, and medical device manufacturing, most recently managing the loan portfolio for a prior healthcare finance business since 2004. Healthcare Collateral Consulting, LLC healthcarecollateralconsulting@gmail.com
Fairfield County, Connecticut
203-610-2515
Monday, January 28, 2008
Friday, January 25, 2008
Home Care 100 Executive Management Conference
February 10-12, 2008
Fairmont Scottsdale Princess Resort, AZ
For Senior Management in Home Care:
In the six years since the conference’s inception, it has become clear that home care and hospice is a much-needed transformative influence on our healthcare system – and it has also become clear that now is only the beginning. Our 2008 conference program reflects the need to build leadership throughout.
The overall theme of Home Care 100 could be termed management excellence. In other words, how can we foster the best possible climate for success in our respective organizations? How can we balance patient care with fiduciary care to achieve an optimal combination of clinical, professional and financial performance? While you may not be able to answer these questions fully in the course of one meeting, at Home Care 100 you will have access to a large number of your senior peers as well as industry speakers from around the country – a terrific resource for sharing ideas and best practices beyond the conference.
For further information please go to:
http://www.homecare100.com/
This link was provide to you by Healthcare Collateral Consulting, LLC. If you would like to advertise on this blog, please email the Public Relations Department at healthcarecollateralconsulting@gmail.com to request additional information.
Fairmont Scottsdale Princess Resort, AZ
For Senior Management in Home Care:
In the six years since the conference’s inception, it has become clear that home care and hospice is a much-needed transformative influence on our healthcare system – and it has also become clear that now is only the beginning. Our 2008 conference program reflects the need to build leadership throughout.
The overall theme of Home Care 100 could be termed management excellence. In other words, how can we foster the best possible climate for success in our respective organizations? How can we balance patient care with fiduciary care to achieve an optimal combination of clinical, professional and financial performance? While you may not be able to answer these questions fully in the course of one meeting, at Home Care 100 you will have access to a large number of your senior peers as well as industry speakers from around the country – a terrific resource for sharing ideas and best practices beyond the conference.
For further information please go to:
http://www.homecare100.com/
This link was provide to you by Healthcare Collateral Consulting, LLC. If you would like to advertise on this blog, please email the Public Relations Department at healthcarecollateralconsulting@gmail.com to request additional information.
CMS PROPOSES RATE YEAR 2009 PAYMENT, POLICY CHANGES FOR LONG-TERM CARE HOSPITALS
The Centers for Medicare & Medicaid Services (CMS) today issued a proposed payment rule designed to assure that long-term care hospitals (LTCHs) continue to receive appropriate payment for services provided while giving them incentives to provide more efficient care to Medicare beneficiaries. LTCHs are a type of acute care hospital that treats some of Medicare’s most severely ill or medically complex patients. The new policies and payment rates would apply to services provided to individuals who are discharged from these hospitals on or after July 1, 2008.
“The proposals announced today will help make sure Medicare beneficiaries who need longer term inpatient care get high quality services appropriate to their medical conditions,” CMS Acting Administrator Kerry Weems said. “The proposals seek increased incentives for efficient delivery of care, ensuring that beneficiaries and taxpayers get the best value for the Medicare dollar.”
The proposed rule would affect the nearly 400 LTCHs across the nation. These hospitals are generally defined as inpatient hospitals where the average length of stay for Medicare patients is greater than 25 days. These hospitals provide extended medical and rehabilitative care for patients with clinically complex conditions. Treatment provided in these hospitals typically includes weaning patients from ventilators so they can breathe without this assistance, pain management, and rehabilitation.
These hospitals have been paid under a prospective payment system (PPS) that provides a single payment to the hospital for the patient’s stay based on the patient’s diagnosis, since cost reporting periods beginning on or after October 1, 2002. Currently, patients are categorized under the Medicare Severity Long-Term Care Diagnosis Related Groups (MS-LTC-DRGs). The payment is calculated to reflect the average costs incurred by an LTCH in treating this type of patient, but does not include payment for services of physicians and nonphysician practitioners who bill Medicare separately.
CMS is proposing a standard Federal rate of $39,076.28 for the 2009 rate year. This is based on a proposed update of 2.6 percent compared with the standard Federal rate for RY 2008, as revised to comply with provisions of the recently enacted Medicare, Medicaid, and SCHIP Extension Act of 2007(“Medicare Extension Act”). The update represents a 3.5 percent increase in the hospital marketbasket (a measure of inflation in the costs of goods and services used in providing inpatient care), less a 0.9 percent adjustment to offset coding changes in RY 2006 that do not reflect real changes in the severity of the cases treated by these hospitals.
Aggregate LTCH PPS payments for RY 2009 are estimated at approximately $4.44 billion, based on the proposed changes presented in the proposed rule, an increase of approximately $124 million over estimated payments in RY 2008.
To read the entire article go to:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2845&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
Healthcare Collateral Consulting, LLC
“The proposals announced today will help make sure Medicare beneficiaries who need longer term inpatient care get high quality services appropriate to their medical conditions,” CMS Acting Administrator Kerry Weems said. “The proposals seek increased incentives for efficient delivery of care, ensuring that beneficiaries and taxpayers get the best value for the Medicare dollar.”
The proposed rule would affect the nearly 400 LTCHs across the nation. These hospitals are generally defined as inpatient hospitals where the average length of stay for Medicare patients is greater than 25 days. These hospitals provide extended medical and rehabilitative care for patients with clinically complex conditions. Treatment provided in these hospitals typically includes weaning patients from ventilators so they can breathe without this assistance, pain management, and rehabilitation.
These hospitals have been paid under a prospective payment system (PPS) that provides a single payment to the hospital for the patient’s stay based on the patient’s diagnosis, since cost reporting periods beginning on or after October 1, 2002. Currently, patients are categorized under the Medicare Severity Long-Term Care Diagnosis Related Groups (MS-LTC-DRGs). The payment is calculated to reflect the average costs incurred by an LTCH in treating this type of patient, but does not include payment for services of physicians and nonphysician practitioners who bill Medicare separately.
CMS is proposing a standard Federal rate of $39,076.28 for the 2009 rate year. This is based on a proposed update of 2.6 percent compared with the standard Federal rate for RY 2008, as revised to comply with provisions of the recently enacted Medicare, Medicaid, and SCHIP Extension Act of 2007(“Medicare Extension Act”). The update represents a 3.5 percent increase in the hospital marketbasket (a measure of inflation in the costs of goods and services used in providing inpatient care), less a 0.9 percent adjustment to offset coding changes in RY 2006 that do not reflect real changes in the severity of the cases treated by these hospitals.
Aggregate LTCH PPS payments for RY 2009 are estimated at approximately $4.44 billion, based on the proposed changes presented in the proposed rule, an increase of approximately $124 million over estimated payments in RY 2008.
To read the entire article go to:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2845&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
Healthcare Collateral Consulting, LLC
Tuesday, January 22, 2008
Healthcare Collateral Consulting, LLC adds New Executive Recruiting Service
The Assignment Division of Healthcare Collateral Consulting, LLC accepts both retained and contingency assignments in both healthcare asset based lending and healthcare private equity marketplace. We are committed to providing confidential, professional services to our clients and candidates alike.
We engage in full range of search assignments including field audit, credit, collateral, underwriting, portfolio/account management, operations, accounting, business development, marketing, sales management, and senior management positions located throughout the nation.
“Many of the players in healthcare lending are focusing on booking transactions without adequate back-office and due diligence support, which has created a void in the marketplace for the type of due diligence, account management and job placement services we offer,” said David J. Lacasse, Managing Director at HCC. "HCC's services are designed to provide a customized solution from healthcare finance professionals ".
To Our Clients: We know your business. At HCC’s-Assignment Division, innovative recruitment for the right talent is imperative. Only after one-on-one interviews do we consider a candidate for placement. All credentials and references are thoroughly checked and validated. Your satisfaction with our candidate’s level of performance is central in establishing a strong relationship and providing innovative outsourcing solutions.
To Our Candidates: We are committed to providing our candidates with prompt, confidential service. Healthcare Collateral Consulting, LLC-Assignment Division offers challenging job opportunities to help meet their personal and professional goals. The most important pledge that we make to our candidates is to represent them in a fair and honest manner.
Healthcare Collateral Consulting, LLC (HCC) provides outsourced due diligence services including field examinations, credit, underwriting, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management. Our healthcare knowledge provides lenders with additional insight into healthcare trade risks that cannot be provided by most other accounting or audit firms.
Contact Information: To learn more about Healthcare Collateral Consulting, LLC’s executive recruiting service or to register with our division as a future candidate, please email Assignments Division at hcc.assignments@gmail.com .
We engage in full range of search assignments including field audit, credit, collateral, underwriting, portfolio/account management, operations, accounting, business development, marketing, sales management, and senior management positions located throughout the nation.
“Many of the players in healthcare lending are focusing on booking transactions without adequate back-office and due diligence support, which has created a void in the marketplace for the type of due diligence, account management and job placement services we offer,” said David J. Lacasse, Managing Director at HCC. "HCC's services are designed to provide a customized solution from healthcare finance professionals ".
To Our Clients: We know your business. At HCC’s-Assignment Division, innovative recruitment for the right talent is imperative. Only after one-on-one interviews do we consider a candidate for placement. All credentials and references are thoroughly checked and validated. Your satisfaction with our candidate’s level of performance is central in establishing a strong relationship and providing innovative outsourcing solutions.
To Our Candidates: We are committed to providing our candidates with prompt, confidential service. Healthcare Collateral Consulting, LLC-Assignment Division offers challenging job opportunities to help meet their personal and professional goals. The most important pledge that we make to our candidates is to represent them in a fair and honest manner.
Healthcare Collateral Consulting, LLC (HCC) provides outsourced due diligence services including field examinations, credit, underwriting, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management. Our healthcare knowledge provides lenders with additional insight into healthcare trade risks that cannot be provided by most other accounting or audit firms.
Contact Information: To learn more about Healthcare Collateral Consulting, LLC’s executive recruiting service or to register with our division as a future candidate, please email Assignments Division at hcc.assignments@gmail.com .
Wednesday, January 16, 2008
7th Annual Asset Based Lending in Capital Markets Conference
February 13 to 14, 2008 • Fairmont Scottsdale Princess - Scottsdale, AZ
Global Asset Based Lending in the Capital Markets Summit heads to the Scottsdale Fairmont Princess February 13-15, 2008. Mark your calendars to attend this premier annual event which focuses on high end corporates and their Funding Options in the Asset Based Finance market. Now in its 7th Year, this event provides comprehensive coverage of today’s issues in the secured debt market.
Asset Based Lending continues to be a highly-charged financing tool used by companies all across the credit spectrum and all around the globe. In M&A, Refinancings, and Raising Capital, Asset-Based Lending plays a prominent role in a company’s capital structure. This event will explain why!
Additional information on this conference can be found at:
http://www.almevents.com/conf_page.cfm?pt=includes/webpages/webwysiwyg.cfm&web_page_id=8450&web_id=1054&instance_id=25&pid=662
This link was provide to you by Healthcare Collateral Consulting, LLC. Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, research, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management. If you would like to advertise on this blog, please email the Public Relations Department at healthcarecollateralconsulting@gmail.com to request additional information.
Global Asset Based Lending in the Capital Markets Summit heads to the Scottsdale Fairmont Princess February 13-15, 2008. Mark your calendars to attend this premier annual event which focuses on high end corporates and their Funding Options in the Asset Based Finance market. Now in its 7th Year, this event provides comprehensive coverage of today’s issues in the secured debt market.
Asset Based Lending continues to be a highly-charged financing tool used by companies all across the credit spectrum and all around the globe. In M&A, Refinancings, and Raising Capital, Asset-Based Lending plays a prominent role in a company’s capital structure. This event will explain why!
Additional information on this conference can be found at:
http://www.almevents.com/conf_page.cfm?pt=includes/webpages/webwysiwyg.cfm&web_page_id=8450&web_id=1054&instance_id=25&pid=662
This link was provide to you by Healthcare Collateral Consulting, LLC. Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, research, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management. If you would like to advertise on this blog, please email the Public Relations Department at healthcarecollateralconsulting@gmail.com to request additional information.
HFMA’s Spring Seminar Series: Denver
Healthcare Financial Management Association’s Spring Seminar
Date
January 22-25, 2008
Location
Grand Hyatt Denver
1750 Welton Street
Denver, CO
Seminars:
Financial and Healthcare Business Management Track
Revenue Cycle Improvements Track
Consumer-Focused Practices Track
Payment Trends
Managed Care Track
Date
January 22-25, 2008
Location
Grand Hyatt Denver
1750 Welton Street
Denver, CO
Seminars:
Financial and Healthcare Business Management Track
Revenue Cycle Improvements Track
Consumer-Focused Practices Track
Payment Trends
Managed Care Track
Additional information on this conference can be found at:
http://www.hfma.org/events/conferences/denver.htm?panel=1
Wednesday, January 9, 2008
Lenders in Complex Corporate Financings: Use Care to Protect Rights
The increasing complexity of corporate financings, coupled with market uncertainty and a credit crunch, is making it more important than ever for lenders in multicreditor deals to protect their rights and interests during negotiations, according to James C. Hale, a corporate finance partner in the Roanoke office of LeClairRyan.
Financing for mergers and acquisitions, leveraged buyouts and recapitalizations often contain components of traditional secured lending as well as mezzanine debt and equity, Hale notes, making it crucial for creditor parties to use great care when it comes to negotiating the finer points of deals.
"It is these details that pose substantial risk to each member of the lender group," Hale says. "With the volatility in the financial markets, intercreditor and subordination terms among lenders have gained new significance. Restrictions on payments and distributions, rights to collateral proceeds, standstill periods, buyout options, priorities upon distribution and their impacts on each credit provider require thorough consideration."
Given the market's increased complexity, first and subordinate lien lenders involved in multicreditor financing transactions need to pay close attention to such key issues as:
Subordination
Intercreditor and subordination agreements commonly contain provisions stating that senior lenders' loans and associated interests and rights are superior to those of sub-debt lenders. A sophisticated first lien holder may demand assurances that subordinated liens are junior in priority, regardless of the failure of the first lien holder to properly perfect its lien, the successful challenge of lien validity by a third party, or any other invalidation of the lien. Many of the relative rights of the parties are, in fact, determined by the other terms of the agreement. Lenders in multicreditor deals must pay close attention to those other terms.
Loan Modifications
Prohibitions against modification of each lender's agreement with the borrower, subject to the consent of the other credit providers, are typical. Negotiated restrictions to loan modifications will often allow a lender to make non-material modifications to an agreement without prior consent. Furthermore, express prohibitions may have a major impact on subordination of collateral, the ability to raise fees or interest, adjusting payment terms and other important issues.
Payments and Distributions
Terms dealing with debt payments and distributions of stock in repayment should be explicit about what is permissible and the conditions under which they may be made and accepted. Permitted payments may be fixed, may be tied to the financial performance of the borrower or reductions in principal outstanding, and prepayments may be prohibited. Senior lenders will often seek to prohibit payments or distributions to subordinated creditors in the event that the loan facility is in default.
Standstill
Senior lenders often require that subordinated lenders agree to a standstill period in the case of a borrower's default, meaning that the lender cannot sue for the debt, exercise rights as a secured creditor, accept payment on its debt or exercise warrants. The standstill period is often 180 days, but lenders may negotiate that time period. Lenders can create exceptions to the standstill to ensure that the senior lender acts expeditiously to protect the interests of the lender group and maximize the return to junior lenders.
Distribution Upon Liquidation
Intercreditor and subordination agreements should be very explicit as to the distribution of proceeds of collateral securing the financing facilities upon the liquidation of assets of the borrower. The order and priority in which the proceeds are distributed is called the "waterfall." Lenders should insist that a waterfall provision be inserted in the agreement, and that the order, allocation, special treatment of certain collateral, and other terms of distribution upon liquidation are unambiguous.
Bankruptcy
The interests of a senior lender can be vastly different from those of junior lender in a bankruptcy or reorganization. Although often requested, sub-lenders need to be careful about transferring authority to the senior lender in an insolvency proceeding. Treatment of collateral, approval of a plan of reorganization, and permitting debtor-in-possession financing affect each lender differently. A sub-debt lender may insist on a buyout option of the senior credit facility. The terms of the buyout are negotiable, but would allow the junior lender to control its destiny in the event bankruptcy is pending or threatened.
"In today's environment, the implications of the agreement among lender parties have gained substantial significance," Hale notes. "Every deal requires a different risk calculus and allocation. As lending covenants and conditions change with the market, so too should the terms and relative interests of credit parties in a multi-tiered financing transaction."
"Each credit party must thoroughly evaluate the manner in which the credit will be administered by each of the lending parties throughout the term of the facility - when the financing is in good standing and, more particularly, in the event that the borrower becomes distressed or in default," he concludes.
A uniquely structured, business-minded law firm, LeClairRyan specializes in developing legal solutions to its clients' business challenges.
Source:
http://www.abfjournal.com/story.asp?id=21799
Financing for mergers and acquisitions, leveraged buyouts and recapitalizations often contain components of traditional secured lending as well as mezzanine debt and equity, Hale notes, making it crucial for creditor parties to use great care when it comes to negotiating the finer points of deals.
"It is these details that pose substantial risk to each member of the lender group," Hale says. "With the volatility in the financial markets, intercreditor and subordination terms among lenders have gained new significance. Restrictions on payments and distributions, rights to collateral proceeds, standstill periods, buyout options, priorities upon distribution and their impacts on each credit provider require thorough consideration."
Given the market's increased complexity, first and subordinate lien lenders involved in multicreditor financing transactions need to pay close attention to such key issues as:
Subordination
Intercreditor and subordination agreements commonly contain provisions stating that senior lenders' loans and associated interests and rights are superior to those of sub-debt lenders. A sophisticated first lien holder may demand assurances that subordinated liens are junior in priority, regardless of the failure of the first lien holder to properly perfect its lien, the successful challenge of lien validity by a third party, or any other invalidation of the lien. Many of the relative rights of the parties are, in fact, determined by the other terms of the agreement. Lenders in multicreditor deals must pay close attention to those other terms.
Loan Modifications
Prohibitions against modification of each lender's agreement with the borrower, subject to the consent of the other credit providers, are typical. Negotiated restrictions to loan modifications will often allow a lender to make non-material modifications to an agreement without prior consent. Furthermore, express prohibitions may have a major impact on subordination of collateral, the ability to raise fees or interest, adjusting payment terms and other important issues.
Payments and Distributions
Terms dealing with debt payments and distributions of stock in repayment should be explicit about what is permissible and the conditions under which they may be made and accepted. Permitted payments may be fixed, may be tied to the financial performance of the borrower or reductions in principal outstanding, and prepayments may be prohibited. Senior lenders will often seek to prohibit payments or distributions to subordinated creditors in the event that the loan facility is in default.
Standstill
Senior lenders often require that subordinated lenders agree to a standstill period in the case of a borrower's default, meaning that the lender cannot sue for the debt, exercise rights as a secured creditor, accept payment on its debt or exercise warrants. The standstill period is often 180 days, but lenders may negotiate that time period. Lenders can create exceptions to the standstill to ensure that the senior lender acts expeditiously to protect the interests of the lender group and maximize the return to junior lenders.
Distribution Upon Liquidation
Intercreditor and subordination agreements should be very explicit as to the distribution of proceeds of collateral securing the financing facilities upon the liquidation of assets of the borrower. The order and priority in which the proceeds are distributed is called the "waterfall." Lenders should insist that a waterfall provision be inserted in the agreement, and that the order, allocation, special treatment of certain collateral, and other terms of distribution upon liquidation are unambiguous.
Bankruptcy
The interests of a senior lender can be vastly different from those of junior lender in a bankruptcy or reorganization. Although often requested, sub-lenders need to be careful about transferring authority to the senior lender in an insolvency proceeding. Treatment of collateral, approval of a plan of reorganization, and permitting debtor-in-possession financing affect each lender differently. A sub-debt lender may insist on a buyout option of the senior credit facility. The terms of the buyout are negotiable, but would allow the junior lender to control its destiny in the event bankruptcy is pending or threatened.
"In today's environment, the implications of the agreement among lender parties have gained substantial significance," Hale notes. "Every deal requires a different risk calculus and allocation. As lending covenants and conditions change with the market, so too should the terms and relative interests of credit parties in a multi-tiered financing transaction."
"Each credit party must thoroughly evaluate the manner in which the credit will be administered by each of the lending parties throughout the term of the facility - when the financing is in good standing and, more particularly, in the event that the borrower becomes distressed or in default," he concludes.
A uniquely structured, business-minded law firm, LeClairRyan specializes in developing legal solutions to its clients' business challenges.
Source:
http://www.abfjournal.com/story.asp?id=21799
Tuesday, January 8, 2008
Commercial Finance Association (CFA) - Educational Program Schedule
FIELD EXAMINER SCHOOL - Los Angeles, CA
Monday-Friday, January 28 - February 1, 2008
The Field Examiner School is a comprehensive five-day program covering every aspect of field examination techniques and practices. Through discussion, simulation and case-study participants learn to evaluate collateral and detect possible fraud by analyzing accounts receivable, inventory, cash, fixed assets, financial statements, internal controls and accounts payable. Emphasis is placed on the field examiner's role in the credit function through real-world examples and "war stories".
ABL BASICS WORKSHOP - New York, NY
Monday-Tuesday, March 3-4, 2008
ABL and Factoring Basics for New Business Development Staff is a two-day workshop designed to provide marketing personnel in entrepreneurial organizations with the essential product knowledge necessary for successful sales. Topics include Basic Understanding of Asset Based Lending and Factoring; Basic Credit Skills; Due Diligence; Operations; and Salesmanship.
ADVANCED LEGAL ISSUES WORKSHOP - Chicago, IL
Monday-Wednesday, April 14-16, 2008
The Advanced Legal Issues Workshop is a three-day forum covering a variety of major legal concerns for asset-based lending professionals. Designed specifically for non-attorneys, the Workshop aims to increase participants' working knowledge of the legal principles that affect their jobs. Combining interactive discussion with both real-life and hypothetical casework, the program covers Multi-lender Transactions, Subordination, Documentation, Fraudulent Conveyance, Bankruptcy, Lender Liability and many other issues. A "Hot Topics" section is included to cover pertinent cases and developments in commercial law and regulation.
CFA LEADERSHIP INSTITUTE - Atlanta, GA
Monday-Wednesday, April 28-30, 2008
The CFA Leadership Institute is designed to provide high-potential staff with the leadership skills required to assume managerial responsibilities in the Asset Based Financial Services Industry. During the three-day program, entitled "Earning The Right To Lead", participants learn: Their roles as leaders within their organizations;how to manage relationships to maximize results; and how to apply these skills in action.
WORKOUTS & BANKRUPCTY WORKSHOP - Washington, D.C.
Tuesday-Thursday, May 6-8, 2008
The Workouts & Bankruptcy Workshop is a three-day program in which participants hone their skills in anticipating, analyzing and evaluating problem situations and developing strategies for either rehabilitation or liquidation. Participants learn the art of crisis management, workout scenarios and realistic liquidation procedures. In the process they explore both the internal and external resources required to implement solutions and resolve client problems. The workshop also leads participants through the legal maze that surrounds crisis loan management, loan restructuring, client rehabilitation and bankruptcy. Case studies utilize group analysis to focus on realistic problems.
FRAUD AWARENESS WORKSHOP - Los Angeles, CA
Wednesday-Friday, May 21-23, 2008
The Fraud Awareness Workshop is a three-day program presenting best practices in the prevention and detection of borrower fraud. The workshop addresses recommended fraud prevention procedures for a variety of ABL disciplines: Account Management, Field Examination, Underwriting, Operations and others. The goal of the program is for participants to understand their roles in mitigating the risk of fraud within their organizations, and to take away specific approaches and techniques in fraud prevention/detection.
Additional information on these programs can be found at:
http://www.cfa.com/Education_Programs/education_schedule.asp#ABL
This link was provide to you by Healthcare Collateral Consulting, LLC. Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, research, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management.
If you would like to advertise on this blog, please email the Public Relations Department at healthcarecollateralconsulting@gmail.com to request additional information.
Monday-Friday, January 28 - February 1, 2008
The Field Examiner School is a comprehensive five-day program covering every aspect of field examination techniques and practices. Through discussion, simulation and case-study participants learn to evaluate collateral and detect possible fraud by analyzing accounts receivable, inventory, cash, fixed assets, financial statements, internal controls and accounts payable. Emphasis is placed on the field examiner's role in the credit function through real-world examples and "war stories".
ABL BASICS WORKSHOP - New York, NY
Monday-Tuesday, March 3-4, 2008
ABL and Factoring Basics for New Business Development Staff is a two-day workshop designed to provide marketing personnel in entrepreneurial organizations with the essential product knowledge necessary for successful sales. Topics include Basic Understanding of Asset Based Lending and Factoring; Basic Credit Skills; Due Diligence; Operations; and Salesmanship.
ADVANCED LEGAL ISSUES WORKSHOP - Chicago, IL
Monday-Wednesday, April 14-16, 2008
The Advanced Legal Issues Workshop is a three-day forum covering a variety of major legal concerns for asset-based lending professionals. Designed specifically for non-attorneys, the Workshop aims to increase participants' working knowledge of the legal principles that affect their jobs. Combining interactive discussion with both real-life and hypothetical casework, the program covers Multi-lender Transactions, Subordination, Documentation, Fraudulent Conveyance, Bankruptcy, Lender Liability and many other issues. A "Hot Topics" section is included to cover pertinent cases and developments in commercial law and regulation.
CFA LEADERSHIP INSTITUTE - Atlanta, GA
Monday-Wednesday, April 28-30, 2008
The CFA Leadership Institute is designed to provide high-potential staff with the leadership skills required to assume managerial responsibilities in the Asset Based Financial Services Industry. During the three-day program, entitled "Earning The Right To Lead", participants learn: Their roles as leaders within their organizations;how to manage relationships to maximize results; and how to apply these skills in action.
WORKOUTS & BANKRUPCTY WORKSHOP - Washington, D.C.
Tuesday-Thursday, May 6-8, 2008
The Workouts & Bankruptcy Workshop is a three-day program in which participants hone their skills in anticipating, analyzing and evaluating problem situations and developing strategies for either rehabilitation or liquidation. Participants learn the art of crisis management, workout scenarios and realistic liquidation procedures. In the process they explore both the internal and external resources required to implement solutions and resolve client problems. The workshop also leads participants through the legal maze that surrounds crisis loan management, loan restructuring, client rehabilitation and bankruptcy. Case studies utilize group analysis to focus on realistic problems.
FRAUD AWARENESS WORKSHOP - Los Angeles, CA
Wednesday-Friday, May 21-23, 2008
The Fraud Awareness Workshop is a three-day program presenting best practices in the prevention and detection of borrower fraud. The workshop addresses recommended fraud prevention procedures for a variety of ABL disciplines: Account Management, Field Examination, Underwriting, Operations and others. The goal of the program is for participants to understand their roles in mitigating the risk of fraud within their organizations, and to take away specific approaches and techniques in fraud prevention/detection.
Additional information on these programs can be found at:
http://www.cfa.com/Education_Programs/education_schedule.asp#ABL
This link was provide to you by Healthcare Collateral Consulting, LLC. Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, research, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management.
If you would like to advertise on this blog, please email the Public Relations Department at healthcarecollateralconsulting@gmail.com to request additional information.
CMS REPORTS U.S. HEALTH CARE SPENDING GROWTH ACCELERATED ONLY SLIGHTLY IN 2006
BUT STILL FASTER THAN ECONOMIC GROWTH AND GENERAL INFLATION
Health care spending growth in the United States accelerated slightly in 2006, increasing 6.7 percent compared to 6.5 percent in 2005, which was the slowest rate of growth since 1999. Health care spending, however, continues to outpace overall economic growth and general inflation, which grew 6.1 percent and 3.2 percent, respectively, in 2006.
In 2006, health care spending reached a total of $2.1 trillion, or $7,026 per person, up from $6,649 per person in 2005, according to a report by the Centers for Medicare & Medicaid Services (CMS). The health spending share of the nation’s Gross Domestic Product (GDP) remained relatively stable in 2006 at 16.0 percent, up by only 0.1 percentage point from 2005.
“The cost of health care continues to be a real and pressing concern. Making sure we are paying for high quality health care services, not just the number of services provided, is just one of the most critical issues facing the American public and the federal government now and in the future,” said CMS Acting Administrator Kerry Weems. “This review of health care spending reminds us that we need to accelerate our efforts to improve our health care delivery system to make sure that Medicare and Medicaid are sustainable for future generations of beneficiaries and taxpayers."
Out-of-pocket spending grew 3.8 percent in 2006, a deceleration from 5.2 percent growth in 2005.
This slowdown is attributable to the negative growth in out-of-pocket payments for prescription drugs, mainly due to the introduction of the Medicare Part D benefit. Out-of-pocket spending accounted for 12 percent of national health spending in 2006; this share has steadily declined since 1998, when it accounted for 15 percent of health spending. Out-of-pocket spending relative to overall household spending, however, has remained fairly flat since 2003.
The CMS found that overall private spending growth slowed in 2006. Private health insurance premiums grew 5.5 percent in 2006, which was the slowest rate of growth since 1997. Benefit payment growth also slowed, from 6.9 percent growth in 2005 to 6.0 percent in 2006. The slower growth reflects, in part, a decline in private health insurance spending on prescription drugs. The ratio of net cost of private health insurance (the difference between premiums and benefits) to total private health insurance premiums was 12.3 percent in 2006, slightly lower than 12.7 percent in 2005.
At the aggregate level in 2006, businesses (25 percent), households (31 percent), other private sponsors (3 percent), and governments (40 percent) paid for about the same share of health services and supplies as they did in 2005. However, spending shifts did occur within major sponsor categories due to implementation of the Medicare Part D benefit. Medicare’s share of federal spending increased from 29 percent in 2005 to 34 percent in 2006, while Medicaid’s share decreased from 45 percent to 40 percent. For households, the share of Medicare spending attributable to payroll taxes and premiums increased slightly in response to first-time Medicare Part D premiums. Conversely, the out-of-pocket spending share decreased slightly due, in part, to the newly available prescription drug coverage through Medicare Part D.
Total Medicaid spending declined for the first time since the program’s inception, falling 0.9 percent in 2006. The introduction of Medicare Part D, which shifted drug coverage for dual eligibles from Medicaid into Medicare, contributed to the decline in Medicaid spending growth. Other reasons for the decline include continued cost containment efforts by states and slower enrollment growth due to more restrictive eligibility criteria and a stronger economy.
Hospital spending, which accounts for 31 percent of total health care spending, grew 7.0 percent in 2006, a decrease of 0.3 percentage points from 2005 and a continued deceleration from 2002 (when growth was 8.2 percent). The 2006 growth rate was partially driven by lower utilization of hospital services, especially within Medicare as fee-for-service inpatient hospital admissions declined.
Spending for physician and clinical services also slowed, increasing 5.9 percent in 2006, which is 1.5 percentage points slower than in 2005 and the slowest rate of growth since 1999. The slowdown was driven by a deceleration in price growth, fueled by a near freeze on Medicare payments to physicians (whose fee schedule update was 0.2 percent in 2006) that influenced private payers as well.
In addition, spending growth for both nursing home and home health services slowed. For freestanding nursing homes, spending grew 3.5 percent in 2006—a deceleration from 4.9 percent in 2005 and the slowest rate of growth since 1999. This deceleration is partially attributable to a reduction in nursing home price growth. Spending growth for freestanding home health care services decelerated from 12.3 percent in 2005 to 9.9 percent in 2006, also partially due to a reduction in price growth. Despite the 2006 deceleration, home health care continues to be the fastest growing component of all personal health care spending.
Source:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2810&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
The health care spending data can be found on the CMS Web site at http://www.cms.hhs.gov/NationalHealthExpendData/01_Overview.asp.
Health care spending growth in the United States accelerated slightly in 2006, increasing 6.7 percent compared to 6.5 percent in 2005, which was the slowest rate of growth since 1999. Health care spending, however, continues to outpace overall economic growth and general inflation, which grew 6.1 percent and 3.2 percent, respectively, in 2006.
In 2006, health care spending reached a total of $2.1 trillion, or $7,026 per person, up from $6,649 per person in 2005, according to a report by the Centers for Medicare & Medicaid Services (CMS). The health spending share of the nation’s Gross Domestic Product (GDP) remained relatively stable in 2006 at 16.0 percent, up by only 0.1 percentage point from 2005.
“The cost of health care continues to be a real and pressing concern. Making sure we are paying for high quality health care services, not just the number of services provided, is just one of the most critical issues facing the American public and the federal government now and in the future,” said CMS Acting Administrator Kerry Weems. “This review of health care spending reminds us that we need to accelerate our efforts to improve our health care delivery system to make sure that Medicare and Medicaid are sustainable for future generations of beneficiaries and taxpayers."
Out-of-pocket spending grew 3.8 percent in 2006, a deceleration from 5.2 percent growth in 2005.
This slowdown is attributable to the negative growth in out-of-pocket payments for prescription drugs, mainly due to the introduction of the Medicare Part D benefit. Out-of-pocket spending accounted for 12 percent of national health spending in 2006; this share has steadily declined since 1998, when it accounted for 15 percent of health spending. Out-of-pocket spending relative to overall household spending, however, has remained fairly flat since 2003.
The CMS found that overall private spending growth slowed in 2006. Private health insurance premiums grew 5.5 percent in 2006, which was the slowest rate of growth since 1997. Benefit payment growth also slowed, from 6.9 percent growth in 2005 to 6.0 percent in 2006. The slower growth reflects, in part, a decline in private health insurance spending on prescription drugs. The ratio of net cost of private health insurance (the difference between premiums and benefits) to total private health insurance premiums was 12.3 percent in 2006, slightly lower than 12.7 percent in 2005.
At the aggregate level in 2006, businesses (25 percent), households (31 percent), other private sponsors (3 percent), and governments (40 percent) paid for about the same share of health services and supplies as they did in 2005. However, spending shifts did occur within major sponsor categories due to implementation of the Medicare Part D benefit. Medicare’s share of federal spending increased from 29 percent in 2005 to 34 percent in 2006, while Medicaid’s share decreased from 45 percent to 40 percent. For households, the share of Medicare spending attributable to payroll taxes and premiums increased slightly in response to first-time Medicare Part D premiums. Conversely, the out-of-pocket spending share decreased slightly due, in part, to the newly available prescription drug coverage through Medicare Part D.
Total Medicaid spending declined for the first time since the program’s inception, falling 0.9 percent in 2006. The introduction of Medicare Part D, which shifted drug coverage for dual eligibles from Medicaid into Medicare, contributed to the decline in Medicaid spending growth. Other reasons for the decline include continued cost containment efforts by states and slower enrollment growth due to more restrictive eligibility criteria and a stronger economy.
Hospital spending, which accounts for 31 percent of total health care spending, grew 7.0 percent in 2006, a decrease of 0.3 percentage points from 2005 and a continued deceleration from 2002 (when growth was 8.2 percent). The 2006 growth rate was partially driven by lower utilization of hospital services, especially within Medicare as fee-for-service inpatient hospital admissions declined.
Spending for physician and clinical services also slowed, increasing 5.9 percent in 2006, which is 1.5 percentage points slower than in 2005 and the slowest rate of growth since 1999. The slowdown was driven by a deceleration in price growth, fueled by a near freeze on Medicare payments to physicians (whose fee schedule update was 0.2 percent in 2006) that influenced private payers as well.
In addition, spending growth for both nursing home and home health services slowed. For freestanding nursing homes, spending grew 3.5 percent in 2006—a deceleration from 4.9 percent in 2005 and the slowest rate of growth since 1999. This deceleration is partially attributable to a reduction in nursing home price growth. Spending growth for freestanding home health care services decelerated from 12.3 percent in 2005 to 9.9 percent in 2006, also partially due to a reduction in price growth. Despite the 2006 deceleration, home health care continues to be the fastest growing component of all personal health care spending.
Source:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2810&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
The health care spending data can be found on the CMS Web site at http://www.cms.hhs.gov/NationalHealthExpendData/01_Overview.asp.
Monday, January 7, 2008
Healthcare Private Equity and Institutional Investors
"A New Outsourcing Strategy for Healthcare Private Equity and Institutional Investors", Healthcare Collateral Consulting, LLC (HCC) has been founded. Our healthcare knowledge provides lenders in Healthcare and Life Sciences with additional insight into healthcare trade risks that cannot be provided by most other accounting or audit firms.
“Many of the players in healthcare lending are focusing on booking transactions without adequate back-office and due diligence support, which has created a void in the marketplace for the type of due diligence and account management services we offer,” said David J. Lacasse, Managing Director at HCC. "HCC's services are designed to provide a customized solution from healthcare finance professionals. Something the traditional competing firm can not provide".
Healthcare Collateral Consulting, LLC has mission to provide superior, cost effective, value added services to our clients. HCC is committed to establishing strong relationships with its clients and providing innovative outsourcing solutions with the highest quality of service.
How do you get started?
If you are interested in learning more, or would like to get in touch with Mr. David Lacasse; He can be reached at the following email address: djlacasse@gmail.com . Please included your name, title, company name and phone number where Mr. Lacasse can reach you.
We look forward to hearing from you,
Healthcare Collateral Consulting, LLC
healthcarecollateralconsulting@gmail.com
Fairfield County, Connecticut
203-610-2515
press release on ABFjournal.com.
http://www.abfjournal.com/story.asp?id=20633
“Many of the players in healthcare lending are focusing on booking transactions without adequate back-office and due diligence support, which has created a void in the marketplace for the type of due diligence and account management services we offer,” said David J. Lacasse, Managing Director at HCC. "HCC's services are designed to provide a customized solution from healthcare finance professionals. Something the traditional competing firm can not provide".
Healthcare Collateral Consulting, LLC has mission to provide superior, cost effective, value added services to our clients. HCC is committed to establishing strong relationships with its clients and providing innovative outsourcing solutions with the highest quality of service.
How do you get started?
If you are interested in learning more, or would like to get in touch with Mr. David Lacasse; He can be reached at the following email address: djlacasse@gmail.com . Please included your name, title, company name and phone number where Mr. Lacasse can reach you.
We look forward to hearing from you,
Healthcare Collateral Consulting, LLC
healthcarecollateralconsulting@gmail.com
Fairfield County, Connecticut
203-610-2515
press release on ABFjournal.com.
http://www.abfjournal.com/story.asp?id=20633
Healthcare Asset Based Lending (ABL Services)
Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management.
HCC's services are designed to provide a customized solution and include:
Managing Director and President - David J. Lacasse has more than 11 years of experience in asset based lending, healthcare finance, and medical device manufacturing, most recently managing the loan portfolio for a prior healthcare finance business since 2004.
Healthcare Collateral Consulting, LLC
healthcarecollateralconsulting@gmail.com
Fairfield County, Connecticut
203-610-2515
HCC's services are designed to provide a customized solution and include:
- Remote Performance & Loan Compliance Reviews
- Underwriting/Due Diligence
- Collateral Exams/Reimbursement Analysis
- Remote Financial Assessments
- Scheduling Engagements & Staffing
- UCC Research
- Monitoring Healthcare Facility Survey Results
- Best Practices Analysis
- Revolving Line of Credit Simulation
- Inventory Analysis
- Hard-asset Verifications
- Special Assets Divestitures
Managing Director and President - David J. Lacasse has more than 11 years of experience in asset based lending, healthcare finance, and medical device manufacturing, most recently managing the loan portfolio for a prior healthcare finance business since 2004.
Healthcare Collateral Consulting, LLC
healthcarecollateralconsulting@gmail.com
Fairfield County, Connecticut
203-610-2515
Happy New Year from Healthcare Collateral Consulting, LLC
The New Year offers us a special opportunity to extend our personal thanks to our clientele, and our very best wishes for the future. So it is that we now gather together and wish to you a very Happy New Year. We consider you a good friend and extend our wishes for a prosperous year and good cheer. It is people like you who make being in business such a pleasure all year long. Our business is a source of pride to us, and with customers like you, we find going to work each day a rewarding experience.
Thanks again for a wonderful year.
David J. Lacasse, Managing Director
Healthcare Collateral Consulting, LLC
203-610-2515
Thanks again for a wonderful year.
David J. Lacasse, Managing Director
Healthcare Collateral Consulting, LLC
203-610-2515
Thursday, December 27, 2007
GE Confirms Merrill Lynch Capital Acquisition
GE Capital has agreed to purchase most of Merrill Lynch Capital, the wholly owned middle-market commercial finance business of investment bank Merrill Lynch & Co. Under the transaction, GE Capital will acquire Merrill Lynch Capital's corporate finance, equipment finance, franchise, energy and healthcare finance units, but will not buy the commercial real estate finance unit. The deal is expected to close in the first quarter of fiscal year 2008. Financial terms of the deal were not disclosed.
Merrill Lynch, which is expected to incur huge write-downs on subprime mortgage-related securities in the fourth quarter, noted that the sale would enable it to redeploy $1.3 billion of capital into other parts of its business. GE Capital said that the acquisition would add more than $10 billion in assets and $5 billion in commitments to GE Capital Commercial Finance's base of $260 billion. Commenting on the deal, Mike Neal, vice chairman of GE said, "These strong units fit perfectly with existing and very successful GE Capital businesses. They are in industries we know well, so the potential for growth is compelling. In addition, this timely acquisition will expand our reach, and expand the value we can offer customers." "This transaction reflects Merrill Lynch's continued strategic focus on divesting non-core assets and optimizing capital allocation, while also enabling the redeployment of approximately $1.3 billion of capital into other parts of our business," added John Thain, chairman and CEO of Merrill Lynch.
Formed in early 2002, Merrill Lynch Capital is a broad-based commercial finance business covering corporate finance, equipment finance, real estate finance and healthcare finance. The equipment finance unit was ranked No.40 in this year's Monitor 100 survey with year-end 2006 assets of $1.6 billion. In the ABF Journal's 2007 spring survey, Merrill Lynch's asset-based lending unit reported total 2006 fundings of $1.9 billion from $3.0 billion in managed commitments.
Merrill Lynch, which is expected to incur huge write-downs on subprime mortgage-related securities in the fourth quarter, noted that the sale would enable it to redeploy $1.3 billion of capital into other parts of its business. GE Capital said that the acquisition would add more than $10 billion in assets and $5 billion in commitments to GE Capital Commercial Finance's base of $260 billion. Commenting on the deal, Mike Neal, vice chairman of GE said, "These strong units fit perfectly with existing and very successful GE Capital businesses. They are in industries we know well, so the potential for growth is compelling. In addition, this timely acquisition will expand our reach, and expand the value we can offer customers." "This transaction reflects Merrill Lynch's continued strategic focus on divesting non-core assets and optimizing capital allocation, while also enabling the redeployment of approximately $1.3 billion of capital into other parts of our business," added John Thain, chairman and CEO of Merrill Lynch.
Formed in early 2002, Merrill Lynch Capital is a broad-based commercial finance business covering corporate finance, equipment finance, real estate finance and healthcare finance. The equipment finance unit was ranked No.40 in this year's Monitor 100 survey with year-end 2006 assets of $1.6 billion. In the ABF Journal's 2007 spring survey, Merrill Lynch's asset-based lending unit reported total 2006 fundings of $1.9 billion from $3.0 billion in managed commitments.
Wednesday, December 5, 2007
Credit Quality in a Freefall
Credit quality deteriorated steeply from mid-October to mid-November despite the recent actions by the Federal Reserve to stimulate credit markets, CFO reports.
As of Nov. 15, $36.2 billion worth of debt was in distressed issues, more than four times the $8.6 billion reported a month earlier, according to Standard & Poor's. Distressed debt as a percentage of total debt recorded its largest monthly increase in five years, more than doubling to 4.9% from 2.3 percent. The ratio was as low as 2.1% 12 months ago.
Read this story in its entirety at CFO.com.
As of Nov. 15, $36.2 billion worth of debt was in distressed issues, more than four times the $8.6 billion reported a month earlier, according to Standard & Poor's. Distressed debt as a percentage of total debt recorded its largest monthly increase in five years, more than doubling to 4.9% from 2.3 percent. The ratio was as low as 2.1% 12 months ago.
Read this story in its entirety at CFO.com.
Health Care VC Funding In 2007 Set To Surpass 2006
Venture Capital Keeps Flowing Into Health Care, Shows No Signs Of Slowing
Venture capital firms invested $686.5 million in 34 privately held health care companies during October 2007, including 16 investments in biotechnology, eight in medical devices, five in biopharmaceuticals, three in pharmaceuticals and two in health care services. According to some sources, at least another $70 million was invested in other health care companies, and undisclosed amounts were invested in some others, but no confirmation of those deals had been received by press time.
Link:
http://www.levinassociates.com/dealmakersforum/dealmakers%20hcfn.htm
Venture capital firms invested $686.5 million in 34 privately held health care companies during October 2007, including 16 investments in biotechnology, eight in medical devices, five in biopharmaceuticals, three in pharmaceuticals and two in health care services. According to some sources, at least another $70 million was invested in other health care companies, and undisclosed amounts were invested in some others, but no confirmation of those deals had been received by press time.
Link:
http://www.levinassociates.com/dealmakersforum/dealmakers%20hcfn.htm
Thursday, November 29, 2007
CMS PUBLISHES NATIONAL LIST OF POOR-PERFORMING NURSING HOMES
The Centers for Medicare & Medicaid Services (CMS) today released the first ranking of the nation's poor-performing nursing homes.
Release of the national list of facilities, identified as special focus facilities (SFFs), is expected to offer powerful new information on nursing homes.
See link:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2672&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
Release of the national list of facilities, identified as special focus facilities (SFFs), is expected to offer powerful new information on nursing homes.
See link:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2672&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
Monday, November 19, 2007
CMS: MEDICARE CONTINUES TO REDUCE IMPROPER CLAIMS PAYMENTS
The Centers for Medicare & Medicaid Services (CMS) announced today that aggressive oversight efforts have resulted in a further reduction of the number of improper Medicare claims payments, which declined from 14.2 percent in 1996, to 4.4 percent in 2006, to 3.9 percent in 2007. This solid improvement is a result of continued efforts initiated by CMS and its contractors to use detailed data analysis in targeting areas where erroneous claims processing, inaccurate billing and provider error result in waste, fraud and abuse.
The decline in improper payments reflects our emphasis on identifying and eliminating waste, fraud and abuse in all CMS programs. It is critical that we ensure every dollar is spent wisely so that the program is affordable for taxpayers and future generations of beneficiaries,� said CMS Acting Administrator Kerry Weems. The Medicare fee-for-service (FFS) error rate has declined from 14.2 percent in 1996, when the Medicare improper payment rate was first reported, to the current 3.9 percent in 2007. During the past three years, recent error rate reductions have led to approximately $11 billion less in improper payments. CMS pays more than 1 billion fee-for-service claims each year.
CMS conducted detailed reviews of randomly sampled Medicare FFS claims submitted between April 1, 2006 and March 31, 2007. Approximately 140,000 claims spanning all types of Medicare FFS payments were included in the Medicare error rate testing program. By providing accurate statistical information to its personnel and contractors, CMS can identify where problems exist and target improvement efforts to address the problems.
This year's results show the commitment to use more detailed data and analysis to identify and eliminate improper payments is working. Protecting the integrity and ensuring the accountability of CMS programs is one of our fundamental responsibilities, and we�re pleased with the improvement to the program, said Weems.
For addtional info:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2633&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
The decline in improper payments reflects our emphasis on identifying and eliminating waste, fraud and abuse in all CMS programs. It is critical that we ensure every dollar is spent wisely so that the program is affordable for taxpayers and future generations of beneficiaries,� said CMS Acting Administrator Kerry Weems. The Medicare fee-for-service (FFS) error rate has declined from 14.2 percent in 1996, when the Medicare improper payment rate was first reported, to the current 3.9 percent in 2007. During the past three years, recent error rate reductions have led to approximately $11 billion less in improper payments. CMS pays more than 1 billion fee-for-service claims each year.
CMS conducted detailed reviews of randomly sampled Medicare FFS claims submitted between April 1, 2006 and March 31, 2007. Approximately 140,000 claims spanning all types of Medicare FFS payments were included in the Medicare error rate testing program. By providing accurate statistical information to its personnel and contractors, CMS can identify where problems exist and target improvement efforts to address the problems.
This year's results show the commitment to use more detailed data and analysis to identify and eliminate improper payments is working. Protecting the integrity and ensuring the accountability of CMS programs is one of our fundamental responsibilities, and we�re pleased with the improvement to the program, said Weems.
For addtional info:
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=2633&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
Monday, November 5, 2007
Company Profile: Healthcare Collateral Consulting, LLC
Healthcare Collateral Consulting, LLC offers outsourced due diligence services including field examinations, credit, underwriting, risk analysis and account management for healthcare lenders, including banks, asset-based lenders, private equity and institutional investors. HCC's associates have extensive healthcare experience in credit, collateral, underwriting, audit, workout management, operations, and account management.
Healthcare Collateral Consulting, LLC has mission to provide superior, cost effective, value added services to our clients. HCC is committed to establishing strong relationships with its clients and providing innovative outsourcing solutions with the highest quality of service.
HCC's services are designed to provide a customized solution and include:
Remote Performance & Loan Compliance Reviews: For many lenders, account executives and portfolio managers simply do not have the time or resources to review a borrower's performance and track record. So, if a site visit is not practical or warranted, Healthcare Collateral Consulting, LLC can perform a thorough remote review of the borrower's performance and any changes in its collateral. HCC can provide our clients with quarterly, semi-annual, or annual credit memorandums. This review can also include the spreading and analysis of financial statements, compliance with loan covenants, and trend analysis of key performance metrics.
Underwriting/Due Diligence: When an influx of new business exceeds the resources available to expeditiously underwrite and process the transaction, all or a portion of the underwriting and due diligence can be outsourced to Healthcare Collateral Consulting, LLC. HCC can manage the due diligence process including collateral audits, financial spreading, preparation of credit request documents and the gathering of legal information.
Collateral Exams: Healthcare Collateral Consulting, LLC executes comprehensive independent exams on prospective borrowers in the Healthcare industry. HCC will evaluate the prospective borrower's collateral, perform reimbursement tests, analyze trends, review systems and operations, review financial reporting, as well as several other targeted areas that assist our clients in making sound credit decisions. Our objective is to provide our clients with a report that is tailored to their needs and relevant to each individual deal.
Remote Financial Assessments: Financial Assessments consist of a remote review of a borrower's overall credit risk. Rather than performing the time consuming tests and reconciliations, typically associated with a collateral audit, these reviews focus on financial performance and trends, collateral trends, operations, management, policies and procedures, and any other material pre-funding deal points. Financial assessments are typically less costly and time consuming and reports are shorter and less cumbersome than full Collateral Exam Reports.
Scheduling Engagements & Staffing: Healthcare Collateral Consulting, LLC can accommodate our clients with quarterly, semi-annual, or annual exams. Often times, Account Executives are too busy to schedule and staffing recurring exams. HCC relieves that burden from our clients by preparing a detailed schedule of exams that is approved by all parties involved. Once on site, HCC will perform the necessary testing to ensure the client is fully aware of their borrower's collateral position and financial well being. The result is a detailed report that is presented in a timely manner.
UCC Research: Healthcare Collateral Consulting, LLC can provide its clients UCC searches with greater reliability and security while helping to increase productivity through potential time and cost savings. HCC has access to an extensive database which allows customizable searches at listed prices to our clients. Public information from every state and in every field - UCC, real property, corporate charter, bankruptcy, tax liens and judgments are all covered. HCC can save time by accelerating the loan approval process and can increase productivity by centralizing UCC search function. HCC can search, manage and track the activity for you.
Monitoring Healthcare Facility Survey Results: Healthcare Collateral Consulting, LLC can offer its clients facility survey results as a likely time saving opportunity. HCC can also recognize potential collateral issues with a revolving line of credit if the facility is non-compliant from its survey results. HCC has access to the Surveys, Certifications, and Reporting database – this includes facility characteristics and health deficiencies issued during the most recent state inspection and recent complaint investigations. Healthcare facilities are required to be in compliance with the State and Federal regulations, to receive payment under the Medicare or Medicaid programs. HCC can save its clients the burden of identifying non-compliant facilities and alerting them of any impending collateral issues. Healthcare Collateral Consulting, LLC can increase visibility and productivity by centralizing this survey monitoring function.
Best Practices Analysis: Healthcare Collateral Consulting, LLC will perform a comprehensive analysis of a company's financial health, and its systems, operations, policies and procedures. HCC will then make detailed recommendations leading to improved profitability, more efficient operations, or the company's ability to obtain additional funds from untapped collateral.
Revolving Line of Credit Simulation: Healthcare Collateral Consulting, LLC can perform a complete analysis of a prospective borrower's proposed RLOC terms and fees. Using the lender's term sheet and historical data for the last 12 to 24 months, HCC can give the prospective borrower insight into the true cost of the revolving line of credit and allow the prospective borrower to test different fee schedule scenarios. HCC can also offer a collateral simulation to determine if the collateral supports the loan balance on any historical month. HCC will then make term sheet recommendations leading to improved cost savings, and/or the ability to obtain additional funds from untapped collateral.
Inventory Analysis: Healthcare Collateral Consulting, LLC reviews the inventory posting processes, statistics, inventory comparative trends, physical test counts and sampling, gross profit tests, inventory costing, inventory concentration, and slow moving inventory. Hard-asset Verifications: Healthcare Collateral Consulting, LLC will verify the existence and quality of a lender's collateral, with equipment, real estate and other property.
Special Assets Divestitures: Healthcare Collateral Consulting, LLC offers assistance to banks, asset-based lenders, private equity and institutional investors in divesting non-performing or high risk accounts or portfolios. HCC will work with a borrower by recommending process and debt structure changes, creating a comprehensive financing memorandum, and soliciting new creditors; all while taking into account the interests of the existing lender. Through its healthcare industry contacts, Healthcare Collateral Consulting, LLC is likely to find a new home for even the most challenged credits.
About HCC's Management:
Managing Director and President - David J. Lacasse has more than 11 years of experience in asset based lending, healthcare finance, and medical device manufacturing, most recently managing the loan portfolio for a prior healthcare finance business since 2004.
How do you get started?
If you are interested in learning more, or would like to get in touch with Mr. David Lacasse; He can be reached at the following email address: djlacasse@gmail.com . Please included your name, title, company name and phone number where Mr. Lacasse can reach you.
We look forward to hearing from you,
Healthcare Collateral Consulting, LLC
Fairfield County, Connecticut
Healthcare Collateral Consulting, LLC has mission to provide superior, cost effective, value added services to our clients. HCC is committed to establishing strong relationships with its clients and providing innovative outsourcing solutions with the highest quality of service.
HCC's services are designed to provide a customized solution and include:
Remote Performance & Loan Compliance Reviews: For many lenders, account executives and portfolio managers simply do not have the time or resources to review a borrower's performance and track record. So, if a site visit is not practical or warranted, Healthcare Collateral Consulting, LLC can perform a thorough remote review of the borrower's performance and any changes in its collateral. HCC can provide our clients with quarterly, semi-annual, or annual credit memorandums. This review can also include the spreading and analysis of financial statements, compliance with loan covenants, and trend analysis of key performance metrics.
Underwriting/Due Diligence: When an influx of new business exceeds the resources available to expeditiously underwrite and process the transaction, all or a portion of the underwriting and due diligence can be outsourced to Healthcare Collateral Consulting, LLC. HCC can manage the due diligence process including collateral audits, financial spreading, preparation of credit request documents and the gathering of legal information.
Collateral Exams: Healthcare Collateral Consulting, LLC executes comprehensive independent exams on prospective borrowers in the Healthcare industry. HCC will evaluate the prospective borrower's collateral, perform reimbursement tests, analyze trends, review systems and operations, review financial reporting, as well as several other targeted areas that assist our clients in making sound credit decisions. Our objective is to provide our clients with a report that is tailored to their needs and relevant to each individual deal.
Remote Financial Assessments: Financial Assessments consist of a remote review of a borrower's overall credit risk. Rather than performing the time consuming tests and reconciliations, typically associated with a collateral audit, these reviews focus on financial performance and trends, collateral trends, operations, management, policies and procedures, and any other material pre-funding deal points. Financial assessments are typically less costly and time consuming and reports are shorter and less cumbersome than full Collateral Exam Reports.
Scheduling Engagements & Staffing: Healthcare Collateral Consulting, LLC can accommodate our clients with quarterly, semi-annual, or annual exams. Often times, Account Executives are too busy to schedule and staffing recurring exams. HCC relieves that burden from our clients by preparing a detailed schedule of exams that is approved by all parties involved. Once on site, HCC will perform the necessary testing to ensure the client is fully aware of their borrower's collateral position and financial well being. The result is a detailed report that is presented in a timely manner.
UCC Research: Healthcare Collateral Consulting, LLC can provide its clients UCC searches with greater reliability and security while helping to increase productivity through potential time and cost savings. HCC has access to an extensive database which allows customizable searches at listed prices to our clients. Public information from every state and in every field - UCC, real property, corporate charter, bankruptcy, tax liens and judgments are all covered. HCC can save time by accelerating the loan approval process and can increase productivity by centralizing UCC search function. HCC can search, manage and track the activity for you.
Monitoring Healthcare Facility Survey Results: Healthcare Collateral Consulting, LLC can offer its clients facility survey results as a likely time saving opportunity. HCC can also recognize potential collateral issues with a revolving line of credit if the facility is non-compliant from its survey results. HCC has access to the Surveys, Certifications, and Reporting database – this includes facility characteristics and health deficiencies issued during the most recent state inspection and recent complaint investigations. Healthcare facilities are required to be in compliance with the State and Federal regulations, to receive payment under the Medicare or Medicaid programs. HCC can save its clients the burden of identifying non-compliant facilities and alerting them of any impending collateral issues. Healthcare Collateral Consulting, LLC can increase visibility and productivity by centralizing this survey monitoring function.
Best Practices Analysis: Healthcare Collateral Consulting, LLC will perform a comprehensive analysis of a company's financial health, and its systems, operations, policies and procedures. HCC will then make detailed recommendations leading to improved profitability, more efficient operations, or the company's ability to obtain additional funds from untapped collateral.
Revolving Line of Credit Simulation: Healthcare Collateral Consulting, LLC can perform a complete analysis of a prospective borrower's proposed RLOC terms and fees. Using the lender's term sheet and historical data for the last 12 to 24 months, HCC can give the prospective borrower insight into the true cost of the revolving line of credit and allow the prospective borrower to test different fee schedule scenarios. HCC can also offer a collateral simulation to determine if the collateral supports the loan balance on any historical month. HCC will then make term sheet recommendations leading to improved cost savings, and/or the ability to obtain additional funds from untapped collateral.
Inventory Analysis: Healthcare Collateral Consulting, LLC reviews the inventory posting processes, statistics, inventory comparative trends, physical test counts and sampling, gross profit tests, inventory costing, inventory concentration, and slow moving inventory. Hard-asset Verifications: Healthcare Collateral Consulting, LLC will verify the existence and quality of a lender's collateral, with equipment, real estate and other property.
Special Assets Divestitures: Healthcare Collateral Consulting, LLC offers assistance to banks, asset-based lenders, private equity and institutional investors in divesting non-performing or high risk accounts or portfolios. HCC will work with a borrower by recommending process and debt structure changes, creating a comprehensive financing memorandum, and soliciting new creditors; all while taking into account the interests of the existing lender. Through its healthcare industry contacts, Healthcare Collateral Consulting, LLC is likely to find a new home for even the most challenged credits.
About HCC's Management:
Managing Director and President - David J. Lacasse has more than 11 years of experience in asset based lending, healthcare finance, and medical device manufacturing, most recently managing the loan portfolio for a prior healthcare finance business since 2004.
How do you get started?
If you are interested in learning more, or would like to get in touch with Mr. David Lacasse; He can be reached at the following email address: djlacasse@gmail.com . Please included your name, title, company name and phone number where Mr. Lacasse can reach you.
We look forward to hearing from you,
Healthcare Collateral Consulting, LLC
Fairfield County, Connecticut
2007 MedPAC Releases Updated Medicare Basics Documents
On October 5, 2007, the Medicare Payment Advisory Commission (MedPAC) released updated documents for its Medicare Basics and Medicare Payment Basics series. The documents include a document entitled Medicare Benefit Design and the following documents which provide an overview of individual Medicare payment systems:
Oxygen and Oxygen Equipment
Skilled Nursing Facilities
Physician Services
Psychiatric Hospital Services
Rehabilitation Facilities
Medicare Part D
Outpatient Therapy Services
Medicare Advantage Program
Outpatient Dialysis Services
Outpatient Hospital Services
Home Health Care Services
Hospice Services
Hospital Acute Inpatient Services
Long-Term Care Hospitals
Clinical Laboratory Services
Critical Access Hospitals
Durable Medical Equipment
Ambulatory Surgical Centers
MedPAC is an independent federal body established by the Balanced Budget Act of 1997 to advise Congress on issues affecting the Medicare program.
http://medicareupdate.typepad.com/medicare_update/2007/10/on-october-5-20.html
Oxygen and Oxygen Equipment
Skilled Nursing Facilities
Physician Services
Psychiatric Hospital Services
Rehabilitation Facilities
Medicare Part D
Outpatient Therapy Services
Medicare Advantage Program
Outpatient Dialysis Services
Outpatient Hospital Services
Home Health Care Services
Hospice Services
Hospital Acute Inpatient Services
Long-Term Care Hospitals
Clinical Laboratory Services
Critical Access Hospitals
Durable Medical Equipment
Ambulatory Surgical Centers
MedPAC is an independent federal body established by the Balanced Budget Act of 1997 to advise Congress on issues affecting the Medicare program.
http://medicareupdate.typepad.com/medicare_update/2007/10/on-october-5-20.html
Cost Reports: General Information
Medicare-certified institutional providers are required to submit an annual cost report to a Fiscal Intermediary (FI). The cost report contains provider information such as facility characteristics, utilization data, cost and charges by cost center (in total and for Medicare), Medicare settlement data, and financial statement data. CMS maintains the cost report data in the Healthcare Provider Cost Reporting Information System (HCRIS). HCRIS includes subsystems for the Hospital Cost Report (CMS-2552-96), Skilled Nursing Facility Cost Report (CMS-2540-96), Home Health Agency Cost Report (CMS-1728-94), Renal Facility Cost Report (CMS-265-94) and Hospice Cost Report (CMS-1984-99). The data is available in a relational database and consists of every data element included in the HCRIS extract created for CMS by the provider's FI. The data files contain the highest level of Medicare Cost report status; for example, if HCRIS has both an as submitted report and a final settled report for a specific fiscal year the data files will only contain the final settled report.
for more information go to: http://www.cms.hhs.gov/CostReports/
for more information go to: http://www.cms.hhs.gov/CostReports/
Tuesday, October 9, 2007
Fitch: Liquidity Solid for U.S. Healthcare Industry
The U.S. healthcare sector has solid liquidity strength, and ongoing credit market volatility will not affect these issuers over the near term, according to a Fitch Ratings review. Fitch estimates that for issuers rated in the 'BBB+' to 'B-' range, total long-term maturities through 2009 are in total approximately $7 billion, while LTM free cash flow for the operators through second-quarter 2007 was approximately $5 billion. Likewise, outstanding cash on the balance sheet as of QII/07 was nearly $15 billion and credit facility availability was nearly $17 billion.
Healthcare companies have been frequent participants in the financial markets in the past several years and, as a result, their aggregate maturity schedule is very favorable over the next few years. "While Fitch believes that liquidity is sufficient for the sector over the next couple years, it should be noted that good liquidity is a requirement for the sector in order to provide financial flexibility to pursue strategic acquisitions or licensing arrangements, or to manage external stresses such as legal challenges and settlements associated with product liability or other material events," Fitch said in a release. "There are inherent event risks associated with the healthcare industry that require increased financial flexibility to ensure a stable credit profile," said Michael Weaver, managing director, Fitch Ratings.
According to Fitch, the for-profit hospital industry does represent a subsector of healthcare with greater liquidity concerns due to a challenging operating environment. This stems from rising levels of bad debt expense and uncompensated care. The sector has also accumulated much higher levels of debt, primarily from several significant leveraged transactions over the past year.
This report is part of the larger global liquidity review initiated by Fitch in May 2007 of its rated issuers across corporate finance as a number of liquidity-based sensitivities in the market continue to influence both issuer and investor decisions.
The full report 'Overall U.S. Health Care Liquidity Strong, but Hospital Operators Weaker' can be found on the Fitch Ratings web site at www.fitchratings.com. Specific liquidity analysis is provided for the pharmaceutical, medical device and for-profit hospital sectors of the healthcare industry.
Healthcare companies have been frequent participants in the financial markets in the past several years and, as a result, their aggregate maturity schedule is very favorable over the next few years. "While Fitch believes that liquidity is sufficient for the sector over the next couple years, it should be noted that good liquidity is a requirement for the sector in order to provide financial flexibility to pursue strategic acquisitions or licensing arrangements, or to manage external stresses such as legal challenges and settlements associated with product liability or other material events," Fitch said in a release. "There are inherent event risks associated with the healthcare industry that require increased financial flexibility to ensure a stable credit profile," said Michael Weaver, managing director, Fitch Ratings.
According to Fitch, the for-profit hospital industry does represent a subsector of healthcare with greater liquidity concerns due to a challenging operating environment. This stems from rising levels of bad debt expense and uncompensated care. The sector has also accumulated much higher levels of debt, primarily from several significant leveraged transactions over the past year.
This report is part of the larger global liquidity review initiated by Fitch in May 2007 of its rated issuers across corporate finance as a number of liquidity-based sensitivities in the market continue to influence both issuer and investor decisions.
The full report 'Overall U.S. Health Care Liquidity Strong, but Hospital Operators Weaker' can be found on the Fitch Ratings web site at www.fitchratings.com. Specific liquidity analysis is provided for the pharmaceutical, medical device and for-profit hospital sectors of the healthcare industry.
S&P: Companies Adopt Aggressive Financial Policies, Harming Credit Quality
The universe of industrial companies that Standard & Poor's rates have displayed a steady decline in average credit quality over the past decade, according to a report published by Standard & Poor's Ratings Services. The median credit rating for U.S. nonfinancial corporations is now 'BB-', compared with 'BBB-' in 1997 and 'A' in 1980.
"Several factors have fueled this trend: an influx of mostly speculative-grade first-time issuers, the LBOs of some companies, and a move toward more aggressive financial policy," says the report, titled "Corporate Financial Policies Evolve Toward The More Aggressive." (The article is part of an ongoing series of reports called "The Leveraging of America.")
The credit squeeze that suddenly overtook the debt markets in July 2007 has highlighted the risks of relying on ready access to low-cost liquidity as a given. Still, it didn't take long after the last credit market problems in 1997-1998 and the economic downturn of 2000-2002 for companies to return to higher risk financial strategies. Those strategies have contributed to the changing mix of ratings on industrial companies -- only 30% of which are now investment grade.
The report is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at http://www.ratingsdirect.com/.
Standard & Poor's, a division of The McGraw-Hill Companies, is a provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data.
"Several factors have fueled this trend: an influx of mostly speculative-grade first-time issuers, the LBOs of some companies, and a move toward more aggressive financial policy," says the report, titled "Corporate Financial Policies Evolve Toward The More Aggressive." (The article is part of an ongoing series of reports called "The Leveraging of America.")
The credit squeeze that suddenly overtook the debt markets in July 2007 has highlighted the risks of relying on ready access to low-cost liquidity as a given. Still, it didn't take long after the last credit market problems in 1997-1998 and the economic downturn of 2000-2002 for companies to return to higher risk financial strategies. Those strategies have contributed to the changing mix of ratings on industrial companies -- only 30% of which are now investment grade.
The report is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at http://www.ratingsdirect.com/.
Standard & Poor's, a division of The McGraw-Hill Companies, is a provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data.
Friday, October 5, 2007
CMS - SEVEN MEDICARE PFFS PLANS ARE APPROVED FOLLOWING RIGOROUS MARKETING REVIEW
The Centers for Medicare & Medicaid Services (CMS) announced today that, after being found compliant with Medicare requirements through a comprehensive marketing review, seven health plan sponsors may resume marketing their Private-Fee-For-Service (PFFS) plans. The approvals allow the sponsors, as well as all other Medicare Advantage organizations, to market to newly eligible Medicare beneficiaries through October 1, 2007. The plans may also market to those beneficiaries with special enrollment periods.
The United Health Group, Blue Cross Blue Shield of Tennessee, Humana Inc., and Sterling Life Insurance Co. represent four of the seven sponsors that voluntarily suspended marketing PFFS plans earlier this year that are now approved. CMS completed a similar review of and approved PFFS-plan marketing by the three other sponsors, Coventry Health Care Inc., Universal American Financial Corp., and WellCare Health Plans Inc., in August.
“Overseeing the marketing activities of Medicare Advantage plans to ensure beneficiaries have access to the health care services they need, and are not discriminated against in any way is one of my top priorities,” said CMS Acting Administrator Kerry Weems. “CMS conducted a comprehensive review of these seven sponsors and found vast improvements to their internal controls and oversight processes consistent with regulations and guidance for Medicare private-fee-for-service plans. But we’re not stopping there. Medicare’s procedures to continuously monitor all plans marketing, including the activities of their agents and brokers, are now in place.”
Any plan that is found to be in violation of CMS requirements can be subject to a full range of available penalties, which can include suspension of marketing and/or enrollment, suspension of payment for new enrollees, civil-monetary penalties, and termination from the Medicare program.
The suspensions of the plan sponsors’ PFFS market activities were lifted only after CMS verified that each organization had the systems and management controls in place to meet all of the conditions specified in the 2008 Call Letter and the May 25, 2007 guidance issued by CMS. When marketing begins for the 2008 benefit year on October 1, 2007, all PFFS plans will be subject to the same standards, which include the following:
All brokers and agents selling the product must pass a written exam to demonstrate an understanding of Medicare PFFS policies and the products being marketed; Plans must telephone beneficiaries requesting enrollment in a PFFS plan to confirm that they understand the terms and conditions of the plan; A provider outreach and education program must be in place to ensure that providers are aware of PFFS plans and their payment provisions and are encouraged by the plans to provide services to PFFS enrollees; Plans must include specific disclaimer language in key enrollee materials to ensure beneficiaries understand the unique aspects of PFFS; Lists of planned marketing and sales events sponsored by the plan’s brokers and agents must be provided to CMS so that CMS can monitor these events.
“Sponsors selling private-fee-for-service plan products will be actively monitored through 1-800-Medicare, our Regional Office casework system and improved oversight systems,” added Weems. “In addition, we have forged new partnerships with State Insurance Commissioners and others to give us an even larger surveillance net to help monitor this program.”
CMS has more than a dozen new oversight activities underway. Some of these activities include:
Creation of a dedicated monitoring team and a comprehensive rapid response plan; Enrollment verifications of new PFFS plan enrollees by CMS to ensure the enrollees were not subject to inappropriate marketing activities and understand the characteristics of a PFFS plan; Increased “secret shopping” at PFFS marketing events; Random audits of PFFS agent training and test files; Thorough reviews of PFFS enrollment packages to verify all required disclaimers are included; Coordination with state insurance departments to share information about agent and broker complaints and license suspensions.
CMS has also developed an outreach plan to educate beneficiaries, advocacy organizations, and other interested parties about the marketing guidelines. “The best practice is prevention. We believe the new requirements and compliance plans build a system that is designed to prevent marketing violations,” Weems concluded.
For additional information on Private-Fee-For-Service (PFFS) click on the zip downloads issued on May 25, 2007 for more information http://www.cms.hhs.gov/PrivateFeeforServicePlans/Downloads/PFFS_Files2.zip
The United Health Group, Blue Cross Blue Shield of Tennessee, Humana Inc., and Sterling Life Insurance Co. represent four of the seven sponsors that voluntarily suspended marketing PFFS plans earlier this year that are now approved. CMS completed a similar review of and approved PFFS-plan marketing by the three other sponsors, Coventry Health Care Inc., Universal American Financial Corp., and WellCare Health Plans Inc., in August.
“Overseeing the marketing activities of Medicare Advantage plans to ensure beneficiaries have access to the health care services they need, and are not discriminated against in any way is one of my top priorities,” said CMS Acting Administrator Kerry Weems. “CMS conducted a comprehensive review of these seven sponsors and found vast improvements to their internal controls and oversight processes consistent with regulations and guidance for Medicare private-fee-for-service plans. But we’re not stopping there. Medicare’s procedures to continuously monitor all plans marketing, including the activities of their agents and brokers, are now in place.”
Any plan that is found to be in violation of CMS requirements can be subject to a full range of available penalties, which can include suspension of marketing and/or enrollment, suspension of payment for new enrollees, civil-monetary penalties, and termination from the Medicare program.
The suspensions of the plan sponsors’ PFFS market activities were lifted only after CMS verified that each organization had the systems and management controls in place to meet all of the conditions specified in the 2008 Call Letter and the May 25, 2007 guidance issued by CMS. When marketing begins for the 2008 benefit year on October 1, 2007, all PFFS plans will be subject to the same standards, which include the following:
All brokers and agents selling the product must pass a written exam to demonstrate an understanding of Medicare PFFS policies and the products being marketed; Plans must telephone beneficiaries requesting enrollment in a PFFS plan to confirm that they understand the terms and conditions of the plan; A provider outreach and education program must be in place to ensure that providers are aware of PFFS plans and their payment provisions and are encouraged by the plans to provide services to PFFS enrollees; Plans must include specific disclaimer language in key enrollee materials to ensure beneficiaries understand the unique aspects of PFFS; Lists of planned marketing and sales events sponsored by the plan’s brokers and agents must be provided to CMS so that CMS can monitor these events.
“Sponsors selling private-fee-for-service plan products will be actively monitored through 1-800-Medicare, our Regional Office casework system and improved oversight systems,” added Weems. “In addition, we have forged new partnerships with State Insurance Commissioners and others to give us an even larger surveillance net to help monitor this program.”
CMS has more than a dozen new oversight activities underway. Some of these activities include:
Creation of a dedicated monitoring team and a comprehensive rapid response plan; Enrollment verifications of new PFFS plan enrollees by CMS to ensure the enrollees were not subject to inappropriate marketing activities and understand the characteristics of a PFFS plan; Increased “secret shopping” at PFFS marketing events; Random audits of PFFS agent training and test files; Thorough reviews of PFFS enrollment packages to verify all required disclaimers are included; Coordination with state insurance departments to share information about agent and broker complaints and license suspensions.
CMS has also developed an outreach plan to educate beneficiaries, advocacy organizations, and other interested parties about the marketing guidelines. “The best practice is prevention. We believe the new requirements and compliance plans build a system that is designed to prevent marketing violations,” Weems concluded.
For additional information on Private-Fee-For-Service (PFFS) click on the zip downloads issued on May 25, 2007 for more information http://www.cms.hhs.gov/PrivateFeeforServicePlans/Downloads/PFFS_Files2.zip
Tuesday, September 18, 2007
CMS- PAYMENT FOR IMAGING SERVICES UNDER THE MEDICARE PHYSICIAN FEE SCHEDULE
HERB KUHN, DIRECTOR, CMM HOUSE SUBCOMMITTEE ON HEALTH OF THE COMMITTEE ON ENERGY AND COMMERCE
Chairman Deal, Representative Brown , distinguished members of the Subcommittee; I thank you for the opportunity to discuss with you some of the changes in payment for imaging services under the Medicare physician fee schedule. Spending for these services has risen dramatically in the past several years, prompting a number of recommendations by the Medicare Payment Advisory Committee (MedPAC), some proposals by CMS, and subsequent actions by the Congress to address the increased spending associated with the rise in the volume and intensity of these services. We want to insure that Medicare’s payment mechanisms encourage clinically appropriate use of resources and the highest quality of care, and we welcome input from you, the physician community, and other interested parties as we do so.
Background
Medicare spending for imaging services has been growing rapidly. Between 2000 and 2005, spending for imaging services paid under the physician fee schedule more than doubled from $6.6 billion to $13.7 billion, an average annual growth rate of 15.7 percent. This compares to an annual growth rate of 9.6 percent for all physician fee schedule services.
As we noted in a letter to MedPAC on April 7, 2006 (see table 1), while imaging services represented an estimated 14 percent of 2005 spending included in the sustainable growth rate calculation (SGR-related spending), they represented 27 percent of the total increase in such spending between 2004 and 2005. Spending for imaging services contributed 2.3 percentage points of the 8.5 percent increase in SGR-related spending reported in our April 7th letter to MedPAC. No other service category affects the increase in SGR-related spending so disproportionately.
Table 2 shows growth rates for imaging services for calendar years 2003, 2004 and 2005, overall and for four subcategories of imaging services: standard imaging, advanced imaging, echography, and imaging procedures. Overall, spending for imaging services grew at 16 percent per year for each of these years.
The “standard imaging” category includes services such as chest x-rays, contrast gastrointestinal imaging, nuclear medicine procedures, and PET scans. Spending for standard imaging procedures increased by an estimated eight percent during 2005 and by 43 percent from 2003 to 2005. This category represents an estimated five percentage points of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 0.4 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
Spending for the “advanced imaging” category, comprised largely of CAT scans and MRI procedures grew by 25 percent during 2005 and 82 percent from 2003 to 2005. This category represents an estimated five percentage points of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 1.3 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
The “imaging procedures” category includes services such as cardiac catheterization, fluoroscopy, and 3-D holographic reconstruction. Estimated spending for the imaging procedures category of services increased by 20 percent during 2005 and 47 percent from 2003 to 2005. This category represents an estimated one percentage point of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 0.1 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
Estimated expenditures for the “echography” category of services increased by 17 percent during 2005 and grew 49 percent from 2003 to 2005. This category represents an estimated three percentage points of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 0.6 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
No matter how one looks at it, Medicare spending for imaging services under the physician fee schedule is growing very rapidly and more rapidly than spending for other services tracked under the SGR system. While MedPAC suggested that some imaging services have shifted from being furnished in facilities, such as hospitals, to physicians’ offices, MedPAC also observed that about 80 percent of the growth in the volume and intensity of these services is unrelated to a shift in setting. The rapid increase in Medicare spending for imaging services, coupled with extensive geographic variation in their use, raises questions about whether such growth is appropriate and whether all imaging services are used appropriately.
Last week the Administration released the Mid-Session Review of the Budget. Part B spending was up from prior estimates. Spending for physicians’ services is estimated to have increased by 10 percent during 2005, and 7 percentage points of this growth was attributable to the volume and intensity of physicians’ services. The volume and intensity of physicians’ services has increased at rates of 6 to 7 percent per year for the past few years. Growth in spending for physicians’ services has been a notable contributor to the increases in the Part B premium. Rapid increases in spending for imaging services contribute significantly to the increase in spending for physicians’ services.
MedPAC Recommendations and the 2006 Medicare Physician Fee Schedule
Limiting Physician Self-Referrals
Section 1877 of the Social Security Act, known as the “Stark Law,” prohibits a physician from making a referral for certain designated health services, payable by Medicare or Medicaid, to an entity with which the physician or one of his/her close family members has a financial relationship, unless one of a specific list of exceptions applies. Among other things, the statute defines designated health services to include “radiology services, including magnetic resonance imaging, computerized axial tomography and ultrasound services” and “radiation therapy services and supplies”.
In its March 2005 report to Congress, MedPAC recommended inclusion of nuclear medicine services in a list of services for which a physician is prevented from making a self-referral under Medicare and Medicaid.
In the notice of proposed rulemaking (NPRM) for the 2006 physician fee schedule, we pursued this MedPAC recommendation and proposed including diagnostic and therapeutic nuclear medicine procedures under the designated health services categories for radiology and certain other imaging services, and radiation therapy services and supplies, respectively. After considering comments on this proposal, we finalized this policy in the 2006 physician fee schedule final rule. To provide time for the industry to adjust, we deferred the effective date of this policy until January 1, 2007.
Despite this change, most physicians in groups that own imaging equipment will be able to continue to make self-referrals for imaging services within their own group by qualifying for one of the broader exceptions to the law -- the “in-office ancillary services” exception. Thus, defining a given service as a designated health service and making it subject to the prohibition against self-referrals does not mean that it will no longer be delivered pursuant to a self-referral in all cases. This change in policy will therefore be only partially effective in addressing growth in the volume and intensity of that particular type of imaging services.
Taking Efficiencies into Account
In general, payment amounts under the Medicare physician fee schedule are calculated using the assumption that each service is furnished independently. Prior to 2006, fee schedule payments for imaging did not take into account efficiencies that occur when multiple services are furnished sequentially. For example, the fee schedule amounts for CT scans of the pelvis and abdomen are established as if each imaging service were the only one being furnished to a beneficiary during a given encounter. The March 2005 MedPAC report recommended reducing the technical component of fee schedule payments for multiple imaging services performed on contiguous body areas. The technical component of an imaging service captures the administration of the test; it does not include the professional interpretation of the test.
In the NPRM for the 2006 physician fee schedule, we proposed revising payment amounts for the technical component of certain imaging services in order to more accurately reflect the economies of subsequent procedures when multiple imaging services are furnished within one of 11 families of imaging procedures on contiguous body parts in the same session with the patient. Specifically, we proposed establishing payment amounts at 50 percent of the technical component of any subsequent imaging procedures performed on a single patient during a single session if the initial and subsequent services were performed on contiguous body parts within one of 11 families of imaging procedure codes. The 50 percent figure was based on our view that most of the clinical labor and supplies are not furnished twice. In response to comments on the proposal, we indicated in the final rule for the 2006 physician fee schedule that we planned to phase in the 50 percent reduction over two years, beginning with a 25 percent reduction in 2006. However, we indicated that we would continue to accept comments and any supporting information from the public, and consider whether it would be appropriate to modify the 50 percent payment reduction policy scheduled to take effect for 2007.
The statute requires that we make physician fee schedule changes, such as the multiple imaging policy, in a budget-neutral fashion relative to overall physician fee schedule expenditures. If changes result in increased spending compared to spending that would occur without them, then a reduction in payments is needed to achieve budget-neutrality. Similarly, if changes result in decreased spending compared to spending that would occur without them, an increase in payments for all services is needed to achieve budget-neutrality. Since the multiple procedure policy resulted in a decrease in spending, we increased payments for all 2006 physician fee schedule services in order to achieve budget-neutrality.
Assumptions Used in Setting Fee Schedule Payments for Imaging
The methodology for determining practice expense relative values for services that involve equipment such as that used in furnishing imaging services involves assumptions about how frequently the equipment is used. In its September 30, 2005, comments on the NPRM for the 2006 physician fee schedule, MedPAC raised concerns about the equipment utilization assumption for imaging services.
CMS’s method of calculating payments for the technical component of imaging services assumes that imaging equipment is used only 50 percent of the time. MedPAC suggested that imaging equipment could be assumed to be used more than 50 percent of the time, given the rapid growth in imaging services. In its June 2006 report to Congress, MedPAC continued its analysis of the equipment utilization assumption for imaging services and indicated: “If a machine is actually used most of the time, its cost is spread across more units of service, resulting in a lower cost per service than if it were operated half the time. Such equipment is currently overvalued by CMS”. In its June 2006 report to Congress, MedPAC also raised questions about the estimates of the cost of capital to purchase equipment such as imaging equipment.
MedPAC argues that the upshot of CMS’s equipment utilization and capital cost assumptions is that Medicare payments for imaging services are too high. The June 2006 MedPAC report indicates, “increasing the equipment use assumption and lowering the interest rate assumption would reduce PE payment rates for services like CT and MRI studies.” The report contains a table with examples of alternative assumptions; payments for imaging services could be reduced by 40 to 50 percent with alternative assumptions. However, data to substantiate alternative equipment utilization assumptions are not available.
The Deficit Reduction Act of 2005
The Deficit Reduction Act of 2005 contains two major provisions that directly affect Medicare payments for imaging services.
Eliminating Budget-Neutrality for the Multiple Imaging Policy
Subsequent to the publication of the final rule for the 2006 Medicare physician fee schedule, section 5102(a) the Deficit Reduction Act (DRA) of 2005 exempted the multiple imaging savings from budget-neutrality. In other words, the DRA requires that, for the 2007 physician fee schedule, we do not offset the savings attributable to the multiple imaging payment reduction policy for 2006 and 2007 by increasing payments for other physician fee schedule services in 2007.
The Hospital Outpatient Department Cap on Physician Fee Schedule Imaging Payments
DRA establishes caps on physician fee schedule payments for certain imaging services at the payment levels established in Medicare’s hospital outpatient prospective payment system (OPPS). The provision requires that Medicare not pay more under the physician fee schedule than Medicare would pay under the OPPS for furnishing the same imaging procedure. This policy applies to the technical components of imaging services including X-ray, ultrasound, nuclear medicine, MRI, CT, and fluoroscopy services. A physician’s interpretation of the test for which Medicare will pay a separate fee is not affected by the provision. Screening and diagnostic mammograms are exempt from this policy change. This policy will begin in 2007.
An example of how this policy works can be seen in the case of an MRI of the brain or an MRI of the abdomen. In 2006, the Medicare physician fee schedule payment is $903 for the technical component of either of these MRIs. At the same time, Medicare pays hospital outpatient departments $506 for the exact same test. Thus, Medicare is paying almost $400 or 78 percent more for doing these MRI imaging tests purely depending on whether the test is performed in a hospital outpatient department or in a physician’s office (or other setting paid under the physician fee schedule). These comparisons do not include a physician’s interpretation of the test for which Medicare will pay a separate fee.
Among imaging procedures, there is little consistency in the percentage by which payments for the technical component under the physician fee schedule exceed payments under the OPPS. The percentage difference varies by procedure. We are still working on the proposed rules for 2007 for both OPPS and the physician fee schedule. The fee schedule NPRM will contain the specific impacts of the DRA imaging provision.
Conclusion
Medicare spending for imaging services has experienced very rapid growth. In addition, through 2006, Medicare is often paying significantly larger amounts under the physician fee schedule than the OPPS for the same imaging service furnished in the two different settings. MedPAC’s analysis of assumptions used to calculate payment amounts indicates payments for imaging services under the physician fee schedule are too high. However, there is a lack of information to support alternative assumptions.
We will implement the DRA provisions through notice and comment rulemaking. NPRMs for OPPS and the physician fee schedule are expected to be published this summer. Final rules will be published this fall and will be effective for services furnished on or after January 1, 2007.
We realize that significant technological advances in imaging capabilities have made a difference in clinical practice and in the lives of patients. However, we want to ensure that our payment systems reflect clinically appropriate care and do not provide inappropriate incentives for growth in volume and intensity of services with limited clinical benefit. To that end, CMS will continue to work with the physician community, other interested parties, and the Congress as we refine our payments for medical imaging. I thank the Subcommittee for its time and look forward to answering any questions you might have.
Source - http://www.cms.hhs.gov/apps/media/press/testimony.asp?Counter=1903
Healthcare Collateral Consulting, LLC's healthcare knowledge provides lenders with additional insight into healthcare trade risks that cannot be provided by most other accounting or audit firms.
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Chairman Deal, Representative Brown , distinguished members of the Subcommittee; I thank you for the opportunity to discuss with you some of the changes in payment for imaging services under the Medicare physician fee schedule. Spending for these services has risen dramatically in the past several years, prompting a number of recommendations by the Medicare Payment Advisory Committee (MedPAC), some proposals by CMS, and subsequent actions by the Congress to address the increased spending associated with the rise in the volume and intensity of these services. We want to insure that Medicare’s payment mechanisms encourage clinically appropriate use of resources and the highest quality of care, and we welcome input from you, the physician community, and other interested parties as we do so.
Background
Medicare spending for imaging services has been growing rapidly. Between 2000 and 2005, spending for imaging services paid under the physician fee schedule more than doubled from $6.6 billion to $13.7 billion, an average annual growth rate of 15.7 percent. This compares to an annual growth rate of 9.6 percent for all physician fee schedule services.
As we noted in a letter to MedPAC on April 7, 2006 (see table 1), while imaging services represented an estimated 14 percent of 2005 spending included in the sustainable growth rate calculation (SGR-related spending), they represented 27 percent of the total increase in such spending between 2004 and 2005. Spending for imaging services contributed 2.3 percentage points of the 8.5 percent increase in SGR-related spending reported in our April 7th letter to MedPAC. No other service category affects the increase in SGR-related spending so disproportionately.
Table 2 shows growth rates for imaging services for calendar years 2003, 2004 and 2005, overall and for four subcategories of imaging services: standard imaging, advanced imaging, echography, and imaging procedures. Overall, spending for imaging services grew at 16 percent per year for each of these years.
The “standard imaging” category includes services such as chest x-rays, contrast gastrointestinal imaging, nuclear medicine procedures, and PET scans. Spending for standard imaging procedures increased by an estimated eight percent during 2005 and by 43 percent from 2003 to 2005. This category represents an estimated five percentage points of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 0.4 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
Spending for the “advanced imaging” category, comprised largely of CAT scans and MRI procedures grew by 25 percent during 2005 and 82 percent from 2003 to 2005. This category represents an estimated five percentage points of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 1.3 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
The “imaging procedures” category includes services such as cardiac catheterization, fluoroscopy, and 3-D holographic reconstruction. Estimated spending for the imaging procedures category of services increased by 20 percent during 2005 and 47 percent from 2003 to 2005. This category represents an estimated one percentage point of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 0.1 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
Estimated expenditures for the “echography” category of services increased by 17 percent during 2005 and grew 49 percent from 2003 to 2005. This category represents an estimated three percentage points of the 14 percent share that imaging represents of 2005 SGR-related spending. This category contributes an estimated 0.6 percentage points to the 2.3 percent increase in imaging spending and to the 8.5 percent increase in SGR-related spending.
No matter how one looks at it, Medicare spending for imaging services under the physician fee schedule is growing very rapidly and more rapidly than spending for other services tracked under the SGR system. While MedPAC suggested that some imaging services have shifted from being furnished in facilities, such as hospitals, to physicians’ offices, MedPAC also observed that about 80 percent of the growth in the volume and intensity of these services is unrelated to a shift in setting. The rapid increase in Medicare spending for imaging services, coupled with extensive geographic variation in their use, raises questions about whether such growth is appropriate and whether all imaging services are used appropriately.
Last week the Administration released the Mid-Session Review of the Budget. Part B spending was up from prior estimates. Spending for physicians’ services is estimated to have increased by 10 percent during 2005, and 7 percentage points of this growth was attributable to the volume and intensity of physicians’ services. The volume and intensity of physicians’ services has increased at rates of 6 to 7 percent per year for the past few years. Growth in spending for physicians’ services has been a notable contributor to the increases in the Part B premium. Rapid increases in spending for imaging services contribute significantly to the increase in spending for physicians’ services.
MedPAC Recommendations and the 2006 Medicare Physician Fee Schedule
Limiting Physician Self-Referrals
Section 1877 of the Social Security Act, known as the “Stark Law,” prohibits a physician from making a referral for certain designated health services, payable by Medicare or Medicaid, to an entity with which the physician or one of his/her close family members has a financial relationship, unless one of a specific list of exceptions applies. Among other things, the statute defines designated health services to include “radiology services, including magnetic resonance imaging, computerized axial tomography and ultrasound services” and “radiation therapy services and supplies”.
In its March 2005 report to Congress, MedPAC recommended inclusion of nuclear medicine services in a list of services for which a physician is prevented from making a self-referral under Medicare and Medicaid.
In the notice of proposed rulemaking (NPRM) for the 2006 physician fee schedule, we pursued this MedPAC recommendation and proposed including diagnostic and therapeutic nuclear medicine procedures under the designated health services categories for radiology and certain other imaging services, and radiation therapy services and supplies, respectively. After considering comments on this proposal, we finalized this policy in the 2006 physician fee schedule final rule. To provide time for the industry to adjust, we deferred the effective date of this policy until January 1, 2007.
Despite this change, most physicians in groups that own imaging equipment will be able to continue to make self-referrals for imaging services within their own group by qualifying for one of the broader exceptions to the law -- the “in-office ancillary services” exception. Thus, defining a given service as a designated health service and making it subject to the prohibition against self-referrals does not mean that it will no longer be delivered pursuant to a self-referral in all cases. This change in policy will therefore be only partially effective in addressing growth in the volume and intensity of that particular type of imaging services.
Taking Efficiencies into Account
In general, payment amounts under the Medicare physician fee schedule are calculated using the assumption that each service is furnished independently. Prior to 2006, fee schedule payments for imaging did not take into account efficiencies that occur when multiple services are furnished sequentially. For example, the fee schedule amounts for CT scans of the pelvis and abdomen are established as if each imaging service were the only one being furnished to a beneficiary during a given encounter. The March 2005 MedPAC report recommended reducing the technical component of fee schedule payments for multiple imaging services performed on contiguous body areas. The technical component of an imaging service captures the administration of the test; it does not include the professional interpretation of the test.
In the NPRM for the 2006 physician fee schedule, we proposed revising payment amounts for the technical component of certain imaging services in order to more accurately reflect the economies of subsequent procedures when multiple imaging services are furnished within one of 11 families of imaging procedures on contiguous body parts in the same session with the patient. Specifically, we proposed establishing payment amounts at 50 percent of the technical component of any subsequent imaging procedures performed on a single patient during a single session if the initial and subsequent services were performed on contiguous body parts within one of 11 families of imaging procedure codes. The 50 percent figure was based on our view that most of the clinical labor and supplies are not furnished twice. In response to comments on the proposal, we indicated in the final rule for the 2006 physician fee schedule that we planned to phase in the 50 percent reduction over two years, beginning with a 25 percent reduction in 2006. However, we indicated that we would continue to accept comments and any supporting information from the public, and consider whether it would be appropriate to modify the 50 percent payment reduction policy scheduled to take effect for 2007.
The statute requires that we make physician fee schedule changes, such as the multiple imaging policy, in a budget-neutral fashion relative to overall physician fee schedule expenditures. If changes result in increased spending compared to spending that would occur without them, then a reduction in payments is needed to achieve budget-neutrality. Similarly, if changes result in decreased spending compared to spending that would occur without them, an increase in payments for all services is needed to achieve budget-neutrality. Since the multiple procedure policy resulted in a decrease in spending, we increased payments for all 2006 physician fee schedule services in order to achieve budget-neutrality.
Assumptions Used in Setting Fee Schedule Payments for Imaging
The methodology for determining practice expense relative values for services that involve equipment such as that used in furnishing imaging services involves assumptions about how frequently the equipment is used. In its September 30, 2005, comments on the NPRM for the 2006 physician fee schedule, MedPAC raised concerns about the equipment utilization assumption for imaging services.
CMS’s method of calculating payments for the technical component of imaging services assumes that imaging equipment is used only 50 percent of the time. MedPAC suggested that imaging equipment could be assumed to be used more than 50 percent of the time, given the rapid growth in imaging services. In its June 2006 report to Congress, MedPAC continued its analysis of the equipment utilization assumption for imaging services and indicated: “If a machine is actually used most of the time, its cost is spread across more units of service, resulting in a lower cost per service than if it were operated half the time. Such equipment is currently overvalued by CMS”. In its June 2006 report to Congress, MedPAC also raised questions about the estimates of the cost of capital to purchase equipment such as imaging equipment.
MedPAC argues that the upshot of CMS’s equipment utilization and capital cost assumptions is that Medicare payments for imaging services are too high. The June 2006 MedPAC report indicates, “increasing the equipment use assumption and lowering the interest rate assumption would reduce PE payment rates for services like CT and MRI studies.” The report contains a table with examples of alternative assumptions; payments for imaging services could be reduced by 40 to 50 percent with alternative assumptions. However, data to substantiate alternative equipment utilization assumptions are not available.
The Deficit Reduction Act of 2005
The Deficit Reduction Act of 2005 contains two major provisions that directly affect Medicare payments for imaging services.
Eliminating Budget-Neutrality for the Multiple Imaging Policy
Subsequent to the publication of the final rule for the 2006 Medicare physician fee schedule, section 5102(a) the Deficit Reduction Act (DRA) of 2005 exempted the multiple imaging savings from budget-neutrality. In other words, the DRA requires that, for the 2007 physician fee schedule, we do not offset the savings attributable to the multiple imaging payment reduction policy for 2006 and 2007 by increasing payments for other physician fee schedule services in 2007.
The Hospital Outpatient Department Cap on Physician Fee Schedule Imaging Payments
DRA establishes caps on physician fee schedule payments for certain imaging services at the payment levels established in Medicare’s hospital outpatient prospective payment system (OPPS). The provision requires that Medicare not pay more under the physician fee schedule than Medicare would pay under the OPPS for furnishing the same imaging procedure. This policy applies to the technical components of imaging services including X-ray, ultrasound, nuclear medicine, MRI, CT, and fluoroscopy services. A physician’s interpretation of the test for which Medicare will pay a separate fee is not affected by the provision. Screening and diagnostic mammograms are exempt from this policy change. This policy will begin in 2007.
An example of how this policy works can be seen in the case of an MRI of the brain or an MRI of the abdomen. In 2006, the Medicare physician fee schedule payment is $903 for the technical component of either of these MRIs. At the same time, Medicare pays hospital outpatient departments $506 for the exact same test. Thus, Medicare is paying almost $400 or 78 percent more for doing these MRI imaging tests purely depending on whether the test is performed in a hospital outpatient department or in a physician’s office (or other setting paid under the physician fee schedule). These comparisons do not include a physician’s interpretation of the test for which Medicare will pay a separate fee.
Among imaging procedures, there is little consistency in the percentage by which payments for the technical component under the physician fee schedule exceed payments under the OPPS. The percentage difference varies by procedure. We are still working on the proposed rules for 2007 for both OPPS and the physician fee schedule. The fee schedule NPRM will contain the specific impacts of the DRA imaging provision.
Conclusion
Medicare spending for imaging services has experienced very rapid growth. In addition, through 2006, Medicare is often paying significantly larger amounts under the physician fee schedule than the OPPS for the same imaging service furnished in the two different settings. MedPAC’s analysis of assumptions used to calculate payment amounts indicates payments for imaging services under the physician fee schedule are too high. However, there is a lack of information to support alternative assumptions.
We will implement the DRA provisions through notice and comment rulemaking. NPRMs for OPPS and the physician fee schedule are expected to be published this summer. Final rules will be published this fall and will be effective for services furnished on or after January 1, 2007.
We realize that significant technological advances in imaging capabilities have made a difference in clinical practice and in the lives of patients. However, we want to ensure that our payment systems reflect clinically appropriate care and do not provide inappropriate incentives for growth in volume and intensity of services with limited clinical benefit. To that end, CMS will continue to work with the physician community, other interested parties, and the Congress as we refine our payments for medical imaging. I thank the Subcommittee for its time and look forward to answering any questions you might have.
Source - http://www.cms.hhs.gov/apps/media/press/testimony.asp?Counter=1903
Healthcare Collateral Consulting, LLC's healthcare knowledge provides lenders with additional insight into healthcare trade risks that cannot be provided by most other accounting or audit firms.
For more information, David Lacasse can be reached at djlacasse@gmail.com
Tuesday, September 11, 2007
CMS INCREASES MEDICARE PAYMENTS FOR BENEFICIARIES USING SKILLED NURSING FACILITY CARE FOR 2008
ACCURATE PAYMENTS CONTINUE TO ENSURE PROGRAM EFFICIENCY, QUALITY AND SUSTAINABILITY
Under new Medicare payment rates issued today by the Centers for Medicare & Medicaid Services (CMS), Medicare payments for beneficiaries using skilled nursing facility care will increase by approximately $690 million in fiscal 2008.
The 3.3 percent increase will be reflected in Medicare payment rates to skilled nursing facilities and hospitals that furnish certain skilled nursing and rehabilitation care to Medicare beneficiaries recovering from serious health problems. The final rule for the skilled nursing facility (SNF) prospective payment system (PPS) was placed on display at the Federal Register today.
"These new payment rates reflect our commitment to improving the quality of care in the long-term care setting while maintaining predictability and stability in payments for the providers who deliver those important services," CMS Acting Administrator Herb Kuhn said. "They will enable nursing homes and Medicare to continue to move forward in providing quality services for patients who need post-acute care. The SNF rule demonstrates our commitment to ensure that Medicare is affordable for current beneficiaries and is sustained for future generations by paying accurately and efficiently."
Under Medicare's SNF PPS, each skilled nursing facility is paid a daily rate based on the relative needs of individual Medicare patients, adjusted for local labor costs. The daily rate covers the costs of furnishing all covered skilled nursing facility services, including routine services such as room, board, nursing services, and some medical supplies together with related costs such as therapies, drugs and lab services; and capital costs including land, buildings and equipment. CMS uses a skilled nursing facility market basket to measure changes in the prices of an appropriate mix of goods and services included in covered skilled nursing facility stays. The price of items in the market basket is measured each year, and Medicare payments are adjusted accordingly.
The final rule revises and rebases the SNF market basket, which currently reflects data from fiscal year 1997, to reflect data from fiscal year 2004. The new payment rates also continue to include a special adjustment made to cover the additional services required by nursing home residents with HIV/AIDs.
"We are confident that the new payment rates will continue to ensure beneficiary access to the important services skilled nursing facilities provide," Mr. Kuhn said.
A full copy of the SNF PPS final rule for FY 2008 is available on the CMS website at http://www.cms.hhs.gov/snfpps/. It is expected to be published in the Federal Register on Friday, August 3, 2007.
Under new Medicare payment rates issued today by the Centers for Medicare & Medicaid Services (CMS), Medicare payments for beneficiaries using skilled nursing facility care will increase by approximately $690 million in fiscal 2008.
The 3.3 percent increase will be reflected in Medicare payment rates to skilled nursing facilities and hospitals that furnish certain skilled nursing and rehabilitation care to Medicare beneficiaries recovering from serious health problems. The final rule for the skilled nursing facility (SNF) prospective payment system (PPS) was placed on display at the Federal Register today.
"These new payment rates reflect our commitment to improving the quality of care in the long-term care setting while maintaining predictability and stability in payments for the providers who deliver those important services," CMS Acting Administrator Herb Kuhn said. "They will enable nursing homes and Medicare to continue to move forward in providing quality services for patients who need post-acute care. The SNF rule demonstrates our commitment to ensure that Medicare is affordable for current beneficiaries and is sustained for future generations by paying accurately and efficiently."
Under Medicare's SNF PPS, each skilled nursing facility is paid a daily rate based on the relative needs of individual Medicare patients, adjusted for local labor costs. The daily rate covers the costs of furnishing all covered skilled nursing facility services, including routine services such as room, board, nursing services, and some medical supplies together with related costs such as therapies, drugs and lab services; and capital costs including land, buildings and equipment. CMS uses a skilled nursing facility market basket to measure changes in the prices of an appropriate mix of goods and services included in covered skilled nursing facility stays. The price of items in the market basket is measured each year, and Medicare payments are adjusted accordingly.
The final rule revises and rebases the SNF market basket, which currently reflects data from fiscal year 1997, to reflect data from fiscal year 2004. The new payment rates also continue to include a special adjustment made to cover the additional services required by nursing home residents with HIV/AIDs.
"We are confident that the new payment rates will continue to ensure beneficiary access to the important services skilled nursing facilities provide," Mr. Kuhn said.
A full copy of the SNF PPS final rule for FY 2008 is available on the CMS website at http://www.cms.hhs.gov/snfpps/. It is expected to be published in the Federal Register on Friday, August 3, 2007.
CMS INCREASES PAYMENTS TO INPATIENT REHABILITATION FACILITIES FOR FISCAL YEAR 2008
ACCURATE PAYMENTS WILL CONTINUE TO ENSURE PROGRAM EFFICIENCY, QUALITY AND SUSTAINABILITY
Inpatient rehabilitation facilities (IRFs) will receive approximately $6.4 billion in payments from Medicare in fiscal year (FY) 2008, under a rule announced today by the Centers for Medicare & Medicaid Services (CMS). The rule will update payment rates and modify payment policies for services furnished to Medicare beneficiaries for discharges occurring on or after October 1, 2007, through September 30, 2008. The rule's provisions are estimated to increase Medicare payments to approximately 1,220 IRFs in FY 2008 by approximately $150 million.
"Today's rule is designed to ensure accurate payments for intensive rehabilitation care provided to Medicare beneficiaries in IRFs," CMS Acting Deputy Administrator Herb Kuhn said. "This continues Medicare's commitment to support beneficiary access to inpatient rehabilitation facility services while at the same time improving the appropriateness and consistency of payment for care across all post acute settings."
"Moreover, combined with payment system rules released today on skilled nursing facilities, we are demonstrating our commitment to ensure that Medicare is affordable for current beneficiaries and is sustained for future generations by paying accurately and efficiently," added Kuhn.
The final rule increases the IRF payments by 3.2 percent, based on the rehabilitation, psychiatric and long-term care hospital (RPL) market basket. The RPL market basket is designed to capture inflation in the costs of goods and services required to provide the specialized services offered by these facilities, similar to the market basket that applies to general acute care hospitals. The rule also increases the high-cost outlier threshold to $7,362 from $5,534 in FY 2007, based on an analysis of 2006 data, which indicates that this threshold would maintain estimated outlier payments at 3 percent of estimated total payments under the IRF PPS.
Although the higher threshold would mean that fewer cases would qualify for outlier payments, a lower outlier threshold would require an across-the-board reduction in the base payment for an IRF stay in order to maintain budget neutrality. The existing short-stay transfer policy was also clarified to indicate that short-stay transfer cases that meet the criteria to qualify for outlier payments are eligible to receive the additional payments.
The final rule also updates the IRF PPS wage index. When in FY 2006 the IRF PPS adopted the Core Based Statistical Area labor market designations developed by the Office of Management and Budget, we identified some geographic areas where there were no hospitals and, thus, no wage index data on which to base the calculation of the IRF PPS wage index. This situation does not currently affect any IRFs.
The final rule establishes a policy by which the average wage index from all contiguous counties can be used in the future as a reasonable proxy for the rural area within that State. (This policy does not apply in Puerto Rico.).
Finally, a policy commonly referred to as the "75 percent rule" is used by CMS to classify a provider as an IRF. Currently, in addition to a patient's principal diagnosis the comorbidities of a patient may be used to determine whether a provider met the requirements of the 75 percent rule. However, for cost reporting periods beginning on of after July1, 2008, comorbidities no longer can be used to determine whether a provider meets the requirements of the 75 percent rule.
Although CMS carefully examined comments regarding the 75 percent rule, at this time data analysis and clinical research do not support revising the current policy. However, CMS will examine its policies using future data to consider improvements to the classification policy as appropriate. The IRF Prospective Payment System (PPS) was first implemented for cost reporting periods beginning on or after January 1, 2002. The objective of implementing a PPS for IRFs was to increase the accuracy of the payments made to these specialized providers for the resources they use to furnish efficient quality care to Medicare beneficiaries. IRFs have received an increase in payment rates each Federal fiscal year since the IRF PPS was implemented. The payment update is designed to ensure accurate payments are made for intensive rehabilitation care provided to Medicare beneficiaries in IRFs. Promoting accuracy of payments for services to Medicare beneficiaries in IRFs supports Medicare's goal of being a prudent purchaser of health services.
For more information please refer to the CMS IRF PPS web site which is http://www.cms.hhs.gov/InpatientRehabFacPPS/. It is expected to be published in the Federal Register on Tuesday, August 7, 2007.
Inpatient rehabilitation facilities (IRFs) will receive approximately $6.4 billion in payments from Medicare in fiscal year (FY) 2008, under a rule announced today by the Centers for Medicare & Medicaid Services (CMS). The rule will update payment rates and modify payment policies for services furnished to Medicare beneficiaries for discharges occurring on or after October 1, 2007, through September 30, 2008. The rule's provisions are estimated to increase Medicare payments to approximately 1,220 IRFs in FY 2008 by approximately $150 million.
"Today's rule is designed to ensure accurate payments for intensive rehabilitation care provided to Medicare beneficiaries in IRFs," CMS Acting Deputy Administrator Herb Kuhn said. "This continues Medicare's commitment to support beneficiary access to inpatient rehabilitation facility services while at the same time improving the appropriateness and consistency of payment for care across all post acute settings."
"Moreover, combined with payment system rules released today on skilled nursing facilities, we are demonstrating our commitment to ensure that Medicare is affordable for current beneficiaries and is sustained for future generations by paying accurately and efficiently," added Kuhn.
The final rule increases the IRF payments by 3.2 percent, based on the rehabilitation, psychiatric and long-term care hospital (RPL) market basket. The RPL market basket is designed to capture inflation in the costs of goods and services required to provide the specialized services offered by these facilities, similar to the market basket that applies to general acute care hospitals. The rule also increases the high-cost outlier threshold to $7,362 from $5,534 in FY 2007, based on an analysis of 2006 data, which indicates that this threshold would maintain estimated outlier payments at 3 percent of estimated total payments under the IRF PPS.
Although the higher threshold would mean that fewer cases would qualify for outlier payments, a lower outlier threshold would require an across-the-board reduction in the base payment for an IRF stay in order to maintain budget neutrality. The existing short-stay transfer policy was also clarified to indicate that short-stay transfer cases that meet the criteria to qualify for outlier payments are eligible to receive the additional payments.
The final rule also updates the IRF PPS wage index. When in FY 2006 the IRF PPS adopted the Core Based Statistical Area labor market designations developed by the Office of Management and Budget, we identified some geographic areas where there were no hospitals and, thus, no wage index data on which to base the calculation of the IRF PPS wage index. This situation does not currently affect any IRFs.
The final rule establishes a policy by which the average wage index from all contiguous counties can be used in the future as a reasonable proxy for the rural area within that State. (This policy does not apply in Puerto Rico.).
Finally, a policy commonly referred to as the "75 percent rule" is used by CMS to classify a provider as an IRF. Currently, in addition to a patient's principal diagnosis the comorbidities of a patient may be used to determine whether a provider met the requirements of the 75 percent rule. However, for cost reporting periods beginning on of after July1, 2008, comorbidities no longer can be used to determine whether a provider meets the requirements of the 75 percent rule.
Although CMS carefully examined comments regarding the 75 percent rule, at this time data analysis and clinical research do not support revising the current policy. However, CMS will examine its policies using future data to consider improvements to the classification policy as appropriate. The IRF Prospective Payment System (PPS) was first implemented for cost reporting periods beginning on or after January 1, 2002. The objective of implementing a PPS for IRFs was to increase the accuracy of the payments made to these specialized providers for the resources they use to furnish efficient quality care to Medicare beneficiaries. IRFs have received an increase in payment rates each Federal fiscal year since the IRF PPS was implemented. The payment update is designed to ensure accurate payments are made for intensive rehabilitation care provided to Medicare beneficiaries in IRFs. Promoting accuracy of payments for services to Medicare beneficiaries in IRFs supports Medicare's goal of being a prudent purchaser of health services.
For more information please refer to the CMS IRF PPS web site which is http://www.cms.hhs.gov/InpatientRehabFacPPS/. It is expected to be published in the Federal Register on Tuesday, August 7, 2007.
CMS ANNOUNCES PAYMENT CHANGES FOR MEDICARE HOME HEALTH SERVICES
CMS ANNOUNCES PAYMENT CHANGES FOR MEDICARE HOME HEALTH SERVICES, IMPROVING BENEFICIARY ACCESS AND QUALITY AND EFFICIENCY OF CARE
The Centers for Medicare & Medicaid Services (CMS) today issued a final rule to refine and update the Home Health Prospective Payment System (HH PPS) for Calendar Year (CY) 2008. This final rule reflects the ongoing efforts of CMS to support beneficiary access to home health services and improve the quality and efficiency of care provided to Medicare beneficiaries through more accurate payments for services rendered. Refinements to the Medicare HH PPS as well as the annual update to the Medicare payment rates for home health services will disburse an estimated additional $20 million in payments to home health agencies in CY 2008.
“This rule continues the agencies effort to improve the efficiency and quality of care for Medicare beneficiaries,” said CMS Acting Deputy Administrator Herb Kuhn. “And when combined with payment system rules we recently released for inpatient hospitals, inpatient rehabilitation facilities, and skilled nursing facilities, we are demonstrating our commitment to ensure that the Medicare program is sustained for future generations by paying accurately and efficiently,” added Kuhn.
Medicare pays home health agencies through a prospective payment system (PPS) which provides for higher payment rates to care for those beneficiaries with greater needs. Payment rates are based on relevant clinical data from patient assessments required to be performed by all Medicare-participating home health agencies (HHAs).
Home health payment rates have been historically updated annually by either the full home health market basket, or by the home health market basket as adjusted by Congress. The home health market basket index measures inflation in the prices of an appropriate mix of items and services furnished by HHAs. Section 5201(c) of the Deficit Reduction Act (DRA) of 2005 requires an adjustment of the home health market basket percentage update for CY 2007 and subsequent years based on the submission of quality data. The home health market basket increase for CY 2008 is 3.0 percent, which results in $430 million in additional payments to home health agencies in CY 2008.
HHAs collect and report Outcome and Assessment Information Set (OASIS) data. For CY 2008, CMS plans to evaluate home health quality of care by using the submission of the OASIS assessments. Continuing to use the current OASIS instrument ensures that providers avoid the additional burden of reporting through a separate mechanism and the extra costs that are associated with the development and testing of a new reporting mechanism.
The final rule will continue to provide for an adjustment to the payment rates for the non-reporting of OASIS assessment quality data. HHAs that submit the quality data as required under current regulations will receive payments based on the full home health market basket update of 3.0 percent for CY 2008. If a HHA does not submit quality data, the home health market basket percentage increase will be reduced by 2.0 percentage points and the HHA will only receive a 1.0 percent update for CY 2008. CMS posts the nationally accepted and approved quality measures on the Medicare Home Health Compare website located at www.Medicare.gov. This final rule adds two new National Quality Forum (NQF) endorsed measures, Emergent Care for Wound Infections, Deteriorating Wound Status and Improvement in Status of Surgical Wound, to the 10 measures that are currently reported for a total of 12 measures to be reported by HHAs in CY 2008.
CMS analysis of the latest available home health claims data, from CY 2005, indicates a 12.78 percent increase in the observed case mix since 2000. The case mix represents the variations in documented conditions of the patient population served by the HHAs. For the final rule, more detailed analysis was conducted on the 12.78 percent increase in case mix to see if any portion of that increase was associated with a real change in the actual clinical condition of home health patients. CMS examined data on demographics, family support, pre-admission location, clinical severity, and non-home health Part A Medicare expenditure data to predict the average case mix weight for 2005. As a result of this analysis, CMS recognizes that an 11.75 percent increase in case-mix is due to changes in coding practices and documentation rather than to treatment of more resource-intensive patients.
To account for the changes in case mix that are not related to home health patients’ actual clinical conditions, this final rule implements a reduction in the national standardized 60-day episode payment rate for 4 years. That reduction will be taken at 2.75 percent per year for three years beginning in CY 2008 and at 2.71 percent for the fourth year in CY 2011. CMS is requesting comment on one aspect of the final rule concerning the fourth year’s 2.71 percent reduction to the payment rates. CMS will continue to monitor for any further increase in case mix that is not related to a change in patient status, and may adjust the percentage reductions and/or implement further case-mix change adjustments in the future.
Currently HHAs are paid prospectively for 60-day episodes of care. HHAs are paid at different rates for patients, depending on their care needs based upon their clinical severity, their level of function, and their usage of HHA rehabilitation services. This final rule implements an improved case-mix model that accounts for comorbidities and the differing health characteristics of longer-stay patients. The model also accounts more precisely for the impact of rehabilitation services on resource use. The revised case mix system replaces the current therapy threshold of 10 visits per episode with three new therapy thresholds at 6, 14, and 20 therapy visits, with graduated payment levels between the thresholds, to reduce the impact of financial incentives on the delivery of therapy visits. These improvements increase the ability of the case-mix model to predict the intensity of resources used to treat home health beneficiaries over a 60-day period, and thus enhance the accuracy of Medicare’s payments to HHAs.
This rule also implements a modification to the low utilization payment adjustment (LUPA) and eliminates the significant change in condition (SCIC) payment adjustment. The rule implements an increased payment for LUPA episodes that occur as the only episode or the first episode during a period of home health care to account for front-loading of costs in an episode.
In light of concerns raised by providers and an analysis of recent home health data, CMS is changing the way we account for non-routine medical supplies (NRS) in the standardized 60-day episode payment rate. This rule implements a payment model for NRS based on 6 severity groups, similar to the clinical case-mix model, to more accurately reflect home health agency costs. CMS added a sixth severity level, to the 5 levels described in the proposed rule, to address episodes with extremely high NRS costs.
Taken together, these budget-neutral refinements will more accurately match HHA costs with payments received while maintaining the fiscal integrity of the Medicare system and encouraging quality care for beneficiaries.
Fact Sheet is available at:
http://www.cms.hhs.gov/apps/media/fact_sheets.asp
Press Release is available at:
http://www.cms.hhs.gov/apps/media/press_releases.asp
A link to the regulation and accompanying documents will be available at: http://www.cms.hhs.gov/center/hha.asp.
The Centers for Medicare & Medicaid Services (CMS) today issued a final rule to refine and update the Home Health Prospective Payment System (HH PPS) for Calendar Year (CY) 2008. This final rule reflects the ongoing efforts of CMS to support beneficiary access to home health services and improve the quality and efficiency of care provided to Medicare beneficiaries through more accurate payments for services rendered. Refinements to the Medicare HH PPS as well as the annual update to the Medicare payment rates for home health services will disburse an estimated additional $20 million in payments to home health agencies in CY 2008.
“This rule continues the agencies effort to improve the efficiency and quality of care for Medicare beneficiaries,” said CMS Acting Deputy Administrator Herb Kuhn. “And when combined with payment system rules we recently released for inpatient hospitals, inpatient rehabilitation facilities, and skilled nursing facilities, we are demonstrating our commitment to ensure that the Medicare program is sustained for future generations by paying accurately and efficiently,” added Kuhn.
Medicare pays home health agencies through a prospective payment system (PPS) which provides for higher payment rates to care for those beneficiaries with greater needs. Payment rates are based on relevant clinical data from patient assessments required to be performed by all Medicare-participating home health agencies (HHAs).
Home health payment rates have been historically updated annually by either the full home health market basket, or by the home health market basket as adjusted by Congress. The home health market basket index measures inflation in the prices of an appropriate mix of items and services furnished by HHAs. Section 5201(c) of the Deficit Reduction Act (DRA) of 2005 requires an adjustment of the home health market basket percentage update for CY 2007 and subsequent years based on the submission of quality data. The home health market basket increase for CY 2008 is 3.0 percent, which results in $430 million in additional payments to home health agencies in CY 2008.
HHAs collect and report Outcome and Assessment Information Set (OASIS) data. For CY 2008, CMS plans to evaluate home health quality of care by using the submission of the OASIS assessments. Continuing to use the current OASIS instrument ensures that providers avoid the additional burden of reporting through a separate mechanism and the extra costs that are associated with the development and testing of a new reporting mechanism.
The final rule will continue to provide for an adjustment to the payment rates for the non-reporting of OASIS assessment quality data. HHAs that submit the quality data as required under current regulations will receive payments based on the full home health market basket update of 3.0 percent for CY 2008. If a HHA does not submit quality data, the home health market basket percentage increase will be reduced by 2.0 percentage points and the HHA will only receive a 1.0 percent update for CY 2008. CMS posts the nationally accepted and approved quality measures on the Medicare Home Health Compare website located at www.Medicare.gov. This final rule adds two new National Quality Forum (NQF) endorsed measures, Emergent Care for Wound Infections, Deteriorating Wound Status and Improvement in Status of Surgical Wound, to the 10 measures that are currently reported for a total of 12 measures to be reported by HHAs in CY 2008.
CMS analysis of the latest available home health claims data, from CY 2005, indicates a 12.78 percent increase in the observed case mix since 2000. The case mix represents the variations in documented conditions of the patient population served by the HHAs. For the final rule, more detailed analysis was conducted on the 12.78 percent increase in case mix to see if any portion of that increase was associated with a real change in the actual clinical condition of home health patients. CMS examined data on demographics, family support, pre-admission location, clinical severity, and non-home health Part A Medicare expenditure data to predict the average case mix weight for 2005. As a result of this analysis, CMS recognizes that an 11.75 percent increase in case-mix is due to changes in coding practices and documentation rather than to treatment of more resource-intensive patients.
To account for the changes in case mix that are not related to home health patients’ actual clinical conditions, this final rule implements a reduction in the national standardized 60-day episode payment rate for 4 years. That reduction will be taken at 2.75 percent per year for three years beginning in CY 2008 and at 2.71 percent for the fourth year in CY 2011. CMS is requesting comment on one aspect of the final rule concerning the fourth year’s 2.71 percent reduction to the payment rates. CMS will continue to monitor for any further increase in case mix that is not related to a change in patient status, and may adjust the percentage reductions and/or implement further case-mix change adjustments in the future.
Currently HHAs are paid prospectively for 60-day episodes of care. HHAs are paid at different rates for patients, depending on their care needs based upon their clinical severity, their level of function, and their usage of HHA rehabilitation services. This final rule implements an improved case-mix model that accounts for comorbidities and the differing health characteristics of longer-stay patients. The model also accounts more precisely for the impact of rehabilitation services on resource use. The revised case mix system replaces the current therapy threshold of 10 visits per episode with three new therapy thresholds at 6, 14, and 20 therapy visits, with graduated payment levels between the thresholds, to reduce the impact of financial incentives on the delivery of therapy visits. These improvements increase the ability of the case-mix model to predict the intensity of resources used to treat home health beneficiaries over a 60-day period, and thus enhance the accuracy of Medicare’s payments to HHAs.
This rule also implements a modification to the low utilization payment adjustment (LUPA) and eliminates the significant change in condition (SCIC) payment adjustment. The rule implements an increased payment for LUPA episodes that occur as the only episode or the first episode during a period of home health care to account for front-loading of costs in an episode.
In light of concerns raised by providers and an analysis of recent home health data, CMS is changing the way we account for non-routine medical supplies (NRS) in the standardized 60-day episode payment rate. This rule implements a payment model for NRS based on 6 severity groups, similar to the clinical case-mix model, to more accurately reflect home health agency costs. CMS added a sixth severity level, to the 5 levels described in the proposed rule, to address episodes with extremely high NRS costs.
Taken together, these budget-neutral refinements will more accurately match HHA costs with payments received while maintaining the fiscal integrity of the Medicare system and encouraging quality care for beneficiaries.
Fact Sheet is available at:
http://www.cms.hhs.gov/apps/media/fact_sheets.asp
Press Release is available at:
http://www.cms.hhs.gov/apps/media/press_releases.asp
A link to the regulation and accompanying documents will be available at: http://www.cms.hhs.gov/center/hha.asp.
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