Repeal Prospects Uncertain for New Medicare Pay Models

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By Michael D. Williamson

Newly announced Medicare payment models for hospitals and physicians could be challenged by Congress in 2017, but it’s not a high priority, a health-care consultant said Dec. 21.

Congress and President-elect Donald Trump’s incoming administration may have too many other items on their agendas to quickly repeal a Centers for Medicare & Medicaid Services rule published Dec. 20, Josh Seidman, senior vice president at Avalere Health, a Washington-based consulting firm, told Bloomberg BNA.

The rule makes final a July proposal that outlined a mandatory CMS pilot project creating bundled payment models for certain cardiac care procedures. Trump’s nominee to be health and human services secretary, Rep. Tom Price (R-Ga.), has ardently opposed Medicare’s mandatory demonstration projects. However, a CMS official contended in a Dec. 20 phone call with reporters that the models need to be mandatory to test whether they improve care and lead to lower spending.

Nearly a quarter of all hospitals in the U.S. will be subject to the pilot project, Seidman said.

The CMS also required hospitals in 45 of the 98 metropolitan areas participating in the cardiac care model to test a heart health rehabilitation pilot project, Jessica Walradt with the Association of American Medical Colleges (AAMC) told Bloomberg BNA Dec. 20. Walradt is the lead specialist for value-based pay models at the AAMC, an industry group for teaching hospitals.

There’s evidence that cardiac rehabilitation works, but only 35 percent of the people who should get the treatment receive it, Walradt said. “We’re happy to see this in the final rule,” she said.

The pilot is designed to help people who have had cardiac events or surgery to recuperate more quickly and effectively, Seidman said. Usually the rehab takes place in an outpatient setting and involves physical therapy and/or exercise routines, he told Bloomberg BNA.

Comprehensive Joint Care

In addition, the rule will implement a surgical hip and femur fracture treatment model in the 67 areas where hospitals and other providers are part of the Comprehensive Care for Joint Replacement Model, another mandatory CMS pilot project. The CMS outlined the hip and femur fracture model in the same July proposal that contained the cardiac care model.

No controversial changes were added to the fracture treatment model compared to the proposed rule, Walradt said. However, the CMS did add waivers for providers to coordinate care, she said.


Hospitals will be able to use more telehealth services if they are in the cardiac care and orthopedic bundled payment programs, Ivy Baer, senior director and regulatory counsel with the AAMC, said Dec. 21. Medicare reimbursement for telehealth is typically restricted.

Moreover, the models would waive Medicare’s three-day inpatient hospital stay requirement before beneficiaries can receive coverage for skilled nursing facility stays, Baer told Bloomberg BNA.

No fraud and abuse authorities were waived in the final rule, an agency fact sheet said Dec. 20. However, waivers of certain fraud and abuse laws for purposes of testing these models may be posted on the CMS and the Health and Human Services Office of the Inspector General websites in the future, the CMS said.

New ACO Program

The CMS on Dec. 20 also outlined an new accountable care organization (ACO) track intended to help small or rural practices. Known as ACO Track 1+, the voluntary program allows physicians to take on less risk for not meeting program goals than other Medicare Shared Savings Program ACO models do.

ACOs are groups of doctors, hospitals and other providers working together to provide better, more coordinated care with the aim of lowering Medicare’s costs. They were created as part of the Affordable Care Act.

The AAMC and other organizations recently urged the CMS to allow providers to take on less risk to qualify for the ACO Track 1+ model, Baer said.

Physicians will be able to join the ACO Track 1+ model in 2018, the CMS said in a Dec. 20 statement. Maximum payment penalties for providers in Track 1+ will range from 4 to 8 percent.

The CMS will issue additional rules pertaining to the Track 1+ model before 2018, Seidman said.

To contact the reporter on this story: Michael D. Williamson in Washington at

To contact the editor responsible for this story: Brian Broderick at

For More Information

The rule is at

The fact sheet is at

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