July 10, 2008

NEXT STOP: THE WHITE HOUSE

With great political drama, the Senate on July 9, 2008, passed H.R. 6331, the "Medicare Improvement for Patients and Providers Act of 2008," by a vote of 69 to 30[i].   The House of Representatives had passed the bill by an overwhelming majority, 355 to 59, on June 24, 2008.  An earlier attempt by the Senate to act on the bill before its July 4^th recess had fallen short of the votes needed to proceed.  Yesterday’s passage of the bill means that it will be sent to the White House, where its future is unclear.

Most press reports describe H.R. 6331 as a bill that cancels the pay cuts to doctors that went into effect on July 1, but the bill also contains improvements for Medicare beneficiaries.  While these improvements are much more modest than the improvements included in legislation passed by the House of Representatives last year, they are still significant and will provide relief to many older people and people with disabilities.

The Political Process

H.R. 6331, as all Medicare legislation during the 110^th Congress, has been mired in the political debate concerning treatment of Medicare Advantage plans.  Although provisions to fix the looming cut in Medicare payments to doctors enjoyed bi-partisan support, the White House has threatened to veto any legislation that makes what it has called significant changes to Medicare Advantage plans.  Despite that comment, the vote by the House of Representative indicates that H.R. 6331 may have sufficient support in the House to override a presidential veto.

Senate procedural politics affected the Senate vote.[ii] Most simply, the vote on H.R. 6331 was technically a vote to invoke "cloture," which is a vote to limit the time spent debating the bill, that is, to avoid a filibuster..  A vote to invoke cloture requires 60 votes.  Thus, even though a majority of Senators voted for H.R. 6331 when it was brought to the floor on June 26th, there were insufficient votes (58)[iii] to invoke cloture and to allow the Senate to vote on the bill itself.   Senator Kennedy (D. Mass.) returned to the Senate for the July 9^th vote on H.R. 6331 to ensure that the bill would receive the necessary 60 votes.  After the 60 votes were reached, additional Senators voted in favor of the bill.  When the bill passed, the Senate proceeded by "unanimous consent" to approve the legislation.  The cloture vote, 69-30, indicates that there also may be sufficient support in the Senate to override a presidential veto. 

A Summary of Provisions in H.R. 6331 Relevant to Medicare Beneficiaries

As indicated, H.R. 6331 contains a number of provisions that make improvements for Medicare beneficiaries.  The Center will issue an Alert that discusses the provisions in more detail if and when H.R. 6331 is enacted into law.

Relevant sections provide:

1.      Provisions for Low-Income Individuals

• QI program:  Extends the QI program through December 31, 2009, and increases funding for the program.

• Low-income subsidy (LIS) and Medicare Savings Program (MSP):  Effective 2010, increases the assets test for MSP to the LIS asset level for full subsidy individuals.  This change includes indexing the MSP asset test for the first time since the program was authorized in 1986.

• MSP applications:  SSA is directed to provide LIS applications and information about MSPs to individuals potentially eligible for such subsidies, to provide assistance with applications, and to share LIS application information with states such that the receipt by the state of such information initiates an application for MSP.

• Out -of -pocket expenses:  Limits cost-sharing for beneficiaries who are dually eligible for Medicare and Medicaid and who enroll in Special Needs Plans to the cost-sharing under Medicaid.

• Late enrollment penalty:  Eliminates the Part D late enrollment penalty for LIS-eligible individuals.

• Eliminates estate recovery:  Eliminates the authority for states to collect from estates of deceased beneficiaries the amounts paid to MSP recipients.

• Changes to definitions of income and resources for LIS: Exempts value of life insurance policy (resources) and in-kind support and maintenance (income).

• Judicial review of LIS decisions:  Provides for a right to federal court review

• Translation of model form:  The model MSP application must be translated into languages most frequently used by Medicare beneficiaries and made available to states.

• Assistance to SHIPs and Area Agencies on Aging: Provides additional funding, some of which is targeted to LIS outreach.

2.      Part A and Part B Provisions:

• Extension of exceptions process for therapy caps:  The process is extended until December 31, 2009.

• Durable medical equipment, prosthetics, orthotics and supplies (DMEPOS):  Delays for 18 months implementation of the competitive bidding acquisition process for DMEPOS, which went into effect in 10 areas on July 1, and modifies the competitive bidding process.

• Improvements to preventive services:  The Secretary can use the national coverage determination process to add coverage of new preventive services.  The "Welcome to Medicare" physical is extended from 6 months to 1 year, and the deductible does not apply.

• Mental health services:  Decreases over 6 years the coinsurance for mental health services to the 20% coinsurance rate for other Medicare services.

• Chronic obstructive pulmonary disease and other conditions:  Includes coverage of intensive cardiac rehabilitation programs and repeals transfer of ownership of oxygen equipment

• Medigap: Requires implementation of modifications made by NAIC to the standard Medigap plans.  The modifications contain restructuring of current benefit packages.

3.      Part C and Part D Provisions:

• Prohibitions and limitations on marketing of Medicare Advantage (MA) and prescription drug (PDP) plans:  Prohibits door-to-door sales, cold calling, cross selling of non-health-related products.  Requires limitations on commissions and gifts, and requires agents to abide by state appointment laws.  Some provisions would be effective in time for the 2008 Annual Enrollment Period.

• Phase-out of indirect medical education (IME):  Phases out an adjustment to MA payment rates for IME, but continues to pay teaching hospitals directly for their higher patient care costs.

NOTE:  This provision is the only adjustment to Medicare Advantage payment rates. It adopts a recommendation of the Medicare Advisory Payment Committee (MedPAC) to eliminate these duplicate payments.

• Private Fee-for-Services (PFFS) changes:  Requires PFFS plans in counties where there are two HMOs or PPOs to form networks of providers, beginning in 2011. Also requires PFFS plans, effective 2010, to have the same quality improvement programs as local PPOs.

• Special Needs Plans (SNPs): Extends the authority of SNPs and the moratorium on new SNPs through December 31, 2010.  Includes new eligibility and care management requirements and quality reporting standards.

• Coverage of barbiturates and benzodiazepines: Permits coverage under Part D of barbiturates (for certain conditions) and benzodiazepines, effective January 1, 2012.

• Protected classes of drugs: Codifies current guidance concerning coverage of "protected classes" of drugs under Part D and authorizes modification of the protected classes through rulemaking.

• Medically accepted indication for drugs:  Authorizes Medicare to revise the compendia used for identifying medically accepted indication for Part D drugs, and provides that the criteria for anticancer drugs covered under Part D should be the same as the criteria for anticancer drugs covered under Part B.

The Center for Medicare Advocacy will continue to provide updates
about the future of H.R. 6331.
 

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