FEDERAL REGULATORY ISSUES

Medicare Administrative Contractors (MACs) -- Contracting Reform

Issue Background: Section 911 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), Pub. L. 108-173, amended Title XVIII of the Act to add section 1874A, Contracts with Medicare Administrative Contractors (MACs). Section 1874A of the Act replaces the prior Medicare intermediary and carrier contracting authorities formerly found in sections 1816 and 1842 of the Act, respectively. This reform (commonly referred to as "Medicare contracting reform" for Medicare fee for-service) is intended to improve Medicare’s administrative services to beneficiaries and health care providers and to bring standard contracting principles to Medicare, such as competition and performance incentives, which the government has long applied to other Federal programs under the Federal Acquisition Regulation (FAR).

Clinical Laboratory Competitive Bidding Medicare Demonstration Project

Issue Background: Section 302(b) of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) required the Centers for Medicare & Medicaid Services (CMS) to design and implement a competitive bidding acquisition program for clinical laboratory services that would otherwise be payable under the Medicare Part B fee schedule. The project will cover demonstration tests for all Medicare Part B beneficiaries who live in the demonstration sites, as determined by the zip code of the beneficiary's residence. There are two demonstration sites and each site will run for three years with a staggered start of one year. The payment basis determined for each competitive bidding area (CBA) will be substituted for payment under the existing clinical laboratory fee schedule. There are expected to be multiple winning bidders within each CBA. As originally designed, the demonstration project would have included dialysis laboratories as “required bidders.”

Conditions for Coverage for End-Stage Renal Disease Facilities

Issue Background: On February 4, 2005, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule revising the requirements that end stage renal disease (ESRD) dialysis facilities must meet to be certified under the Medicare program. According to CMS, the revised requirements focus on the patient and the results of the care provided to the patient, establish performance expectations for facilities, encourage patients to participate in their care plan and treatment, eliminate many procedural requirements from the current conditions for coverage, and preserve strong process measures when necessary to promote patient well being and continuous quality improvement. The revised conditions are intended to reflect the advances in dialysis technology and standard care practices since the requirements were last revised in their entirety in 1976.

Medicaid Average Manufacturer Price (AMP)

Issue Background: The Deficit Reduction Act of 2006 changed the basis for drug payments under Medicaid, requiring states to now use the Average Manufacturer Price (AMP) instead of the Average Wholesale Price (AWP) as the benchmark for reimbursement. The DRA also sets the Federal Upper Payment Limit (FUL) at 250% of the AMP for the least costly product for multiple source drugs. Despite the timelines for implementation included in the DRA, CMS has not yet required states to move from AWP to AMP because the rulemaking process is still ongoing.

CMS ESRD Disease Management Demonstration

Issue Background: The Centers for Medicare & Medicaid Services (CMS) is currently conducting a demonstration to determine the potential effect of various disease management applications on care cost containment and quality improvement for individuals with ESRD and who are enrolled in Medicare Advantage (MA) health plans. CMS is conducting this demonstration under the general authority granted to the Secretary of Health and Human Services to operate demonstrations.

There are three participants in the demo: Davita-Scan Health Plan, EverCare-United Healthcare and Fresenius Medical Health Plan. Each demo site has selected various Medicare Advantage models for their individual product offerings. The demo began in 2006 and is scheduled for four years.

STATE REGULATORY ISSUES

Medicaid Citizenship Documentation Requirement

Background: Section 6036 of the Deficit Reduction Act of 2005 (DRA), which was enacted on February 8, 2006, requires States to obtain satisfactory documentation of a declaration of citizenship. Self-attestation of citizenship and identity is no longer an acceptable practice under the DRA. For new Medicaid applicants or currently enrolled individuals, States must obtain evidence of citizenship and identity at the time of application or at the time of the first redetermination occurring on or after July 1, 2006. Between 5% and 11% of our patients rely solely on Medicaid for their health care needs, and up to 40% of Medicare dialysis populations are “dual eligible”, relying on Medicare as their primary insurance and Medicaid as secondary. An unknown number of these patients may be without the appropriate documentation or have difficulty locating documentation to prove citizenship and identity and, therefore, may lose their Medicaid benefits as a result of the proof of citizenship requirements mandated by the DRA.

Proposed Regulation to Require ACLS in Alabama Dialysis Facilities

Issue Background: The Alabama Department of Health (DOH) distributed in November a proposed ESRD facility licensure regulation that would require each licensed facility in the state to have Advanced Cardiac Life Support (ACLS) available immediately: defibrillator, supplies (locked crash cart, airway mgt. devices), narcotics, and a nurse with American Heart Association ACLS certification in the facility at all times. A physician must be present when ACLS is used. The Alabama DOH revised the proposed regulation following the comments presented by dialysis providers and ANNA at a hearing held on November 27, 2006. The proposed revised regulation still requires ACLS equipment, cardiac drugs and supplies, and an ACLS certified RN in the facility at all times for dialysis facilities located more than ten miles from a licensed acute care hospital. The State Committee of Public Health is meeting mid-June to finalize the rule.

California Changes ESRD Facility Licensure Fees

Issue Background: In June 2006, the California Legislature approved a new methodology for determining annual fees for all provider types that are licensed by the state. The objective of the legislation was to cover the $124 million cost of the state’s Licensure and Certification Division’s (L&C) programs by federal money for Medicare survey and certification ($62 million) and by a special fund of user fees ($62 million) by the 2009/2010 fiscal year. The CA Legislature has stipulated that licensure fees should begin to absorb the total cost of state licensure survey activities, with no further subsidization from the state. This concept that the state licensing programs become self-sufficient in their operating budget, will continue to place an emphasis on increasing state licensing fees.

Colorado Patient Care Technicians Licensure

Issue Background: Colorado law provides that any individual, or any other interested party, may submit an application for the regulation of an unregulated occupation or profession. Two individuals from Fort Collins filed an application in 2005 to request that Patient Care
Technicians (PCTs) in dialysis be licensed preferring state licensure to ensure minimum competencies for technicians and standards of care and safer treatments for patients. The 2006 Sunrise Review for Hemodialysis Technicians reported "Do not license, certify, or otherwise regulate hemodialysis technicians." Despite this report, on January 2007, legislature to regulate Hemodialysis Technicians was passed during the 2007 legislative session. The State Board of Health will be responsible for writing rules by January 1, 2008 and the requirements placed on dialysis clinics in the bill will take effect on January 1, 2009.

Mississippi Hemodialysis Patient Care Technician Certification

Issue Background: Past Mississippi state regulations did not allow unlicensed patient care technicians to cannulate patients. Patient care technicians could care for dialysis patients after they were cannulated or connected to dialysis via a catheter and could provide care for the patients during treatment which included monitoring vital signs and machine/technical parameters, including fluid removal during dialysis treatments. HB 895 was passed during the 2006 session of the Mississippi state legislature authorizing the creation of a statewide program for certification of technicians under the Mississippi Board of Nursing. The Board appointed a Hemodialysis Technician Advisory Panel, which included representatives from dialysis providers, to assist in drafting and implementing regulations. The Board issued proposed regulations for public comment on January 5, 2007, authorizing the certification of hemodialysis technicians and expanding the role of LPNs in hemodialysis to include IV therapy.

On February 9, 2007 the Mississippi Board of Nursing held a meeting to discuss comments submitted and hear questions or comments of those in attendance. They voted unanimously to adopt the regulations with some revisions made from those who submitted comments and items requiring further clarifications[schragw] including emphasizing that technicians who do not become certified can continue to work in their current duties but must not use the title of hemodialysis technician and grandfathering LPNs currently certified in hemodialysis. The regulations do not identify a specific hemodialysis technician certification exam or training curriculum at this time; dialysis providers are continuing to be in conversation with the Mississippi Nurses Association and the Board of Nursing. The regulations took effect on March 19, 2007.

Dialysis Facility Survey and Certification Process Issues

Issue Background: The availability of dialysis facilities is currently hampered by the lack of CMS and state resources for survey and certification activities. Unlike other providers and suppliers that may achieve deemed status through accreditation, ESRD facilities must obtain Medicare certification solely through the initial survey process conducted by state survey agencies. Unfortunately, this process is hampered by insufficient resources, staffing shortages, and survey priorities that place other care sites ahead of dialysis facilities. Consequently, many facilities stand ready to serve dialysis patients yet instead remain unused for months as they await review. As a result, many patients are forced to travel to outlying facilities for their care while closer, more convenient facilities remain unused.

For more information on federal and state regulatory issues contact The Kidney Care Council at (202) 756-3031.