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The Centers for Medicare & Medicaid Services (CMS) has recently issued a host of Medicare-related proposed rules that are currently open for comment, including the following:

MACRA (Physician Payment)

On April 27, 2016, CMS released a proposed rule outlining new physician payment systems created by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The proposed rule will be published in the Federal Register on May 9, 2016. CMS also issued a press release discussing the proposed rule.

MACRA repealed the flawed sustainable growth rate (SGR) methodology previously used to calculate physician payment in the Medicare program. SGR is replaced by a new Merit-based Incentive Payment System (MIPS) for MIPS eligible clinicians or groups. The proposed rule would establish the MIPS and also would establish incentives for physician participation in certain alternative payment models (APMs).

  • Comments are due June 27, 2016.

Part B Drug Demonstration

As discussed in a previous Alert, on March 11, 2016 CMS published a proposed rule aimed at reforming how Medicare pays for drugs covered under Part B. CMS states that its main objective is to ensure that physicians are prescribing the most effective prescription drugs in order to improve patient treatment and to rein in drug spending.

Under the proposed rule, CMS will implement a two-phase payment model over five years. In Phase I, CMS will decrease the add-on payment included in physician reimbursements for administering Part B drugs from 6 percent to 2.5 percent, plus a $16.80 flat fee. In Phase II, CMS will implement value-based pricing strategies, including reference pricing, indications-based pricing, risk-sharing agreements based on outcomes, discounting or eliminating patient cost sharing, and feedback on prescription patterns and online decision support tools.

The Center will submit comments, and has signed on to a letter supporting the demonstration along with 24 other organizations, including AARP, other consumer advocates, unions, and health plans.

The proposed rule, CMS-1670-P, is at 81 Fed. Reg.13230 (Mar. 11, 2016), available at:

  • Comments due Monday, May 9, 2016.

Hospital Payment (Including NOTICE Act relating to Observation Status)

In the proposed rules to update Medicare reimbursement to acute care hospitals, CMS includes revisions to the Medicare hospital inpatient prospective payment systems (IPPS), and proposed policy updates to the Hospital Value-Based Purchasing (VBP) Program, the Hospital Readmissions Reduction Program, and the Hospital-Acquired Condition (HAC) Reduction Program.

In addition, CMS also announces how it intends to implement the Notice of Observation Treatment and Implication for Care Eligibility Act (NOTICE Act). As discussed in our April 27 Alert, the Center has significant concerns about the proposed rules relating to the notice required by this Act.

The proposed rules, CMS-1655-P, is at 81 Fed. Reg. 24945 (April 27, 2016), available at

  • Comments are due June 17, 2016.

Skilled Nursing Facilities

On April 25, 2016, proposed rules were published in the Federal Register to update Medicare reimbursement rates for Skilled Nursing Facilities (SNFs) for fiscal year 2017 (which begins July 1, 2016).  Also included were updates and requests for public comment on the SNF Value-Based Purchasing Program (mandated by §215 of the Protecting Access to Medicare Act of 2014); SNF Quality Reporting Program (mandated by Improving Medicare Post-Acute Care Transformation Act of 2014); and SNF Payment Models Research (i.e., revisions to reimbursement methodology for therapy and nursing). 

The proposed rule, CMS-1645-P, is at 81 Fed. Reg. 24229 (April 25, 2016), available at:

  • Comments are due June 20, 2016.

The Center for Medicare Advocacy will submit comments regarding all these important proposals. We encourage other beneficiary advocates to do so as well, and to contact us if we can help.

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