President Bush has signed into law S. 2499, the “Medicare, Medicaid, and SCHIP Extension Act of 2007” (the “Act”). Most notably, the legislation postpones for six months a 10.1% across-the-board cut in Medicare physician payments that was scheduled to go into effect January 1, 2008. Other policy changes include, among many others:
- Changes in Medicare long-term care hospital (“LTCH”) policy, including a new statutory definition of an LTCH with facility criteria, relief from certain payment policies for three years, a three-year moratorium on the development of new LTCHs and LTCH beds, no payment update for the last quarter of rate year 2008, and new medical necessity reviews by Medicare contractors;
- Revisions to inpatient rehabilitation facility (“IRF”) qualifications and payment policy, including a permanent freeze in the patient classification criteria compliance threshold at 60% (with comorbid conditions counting toward this threshold) and a payment freeze from April 1, 2008 through September 30, 2009;
- An extension of the therapy cap exception process through June 30, 2008;
- A provision to require the Centers for Medicare & Medicaid Services (“CMS”) to adjust Part B drug average sales price (“ASP”) calculations to use volume-weighted ASPs based on actual sales volume;
- Elimination of Medicare Advantage (“MA”) stabilization funding for regional preferred provider organizations in 2012, an extension of authority for specialized MA plans for special needs individuals, and a moratorium on new special needs plans and expanded service areas through December 31, 2009;
- A 6-month delay in CMS rules on Medicaid payment for school-based and rehabilitation services; and
- An extension of the authorization and funding of the State Children’s Health Insurance Program (“SCHIP”) through March 31, 2009.
The following is a summary of the major provisions of the Act. We would be pleased to provide you with additional information upon request.
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