The Latest from the Biden Administration
Calendar Year 2025 Medicare Physician Fee Schedule Final Rule - CMS
CMS released the CY 2025 Medicare Physician Fee Schedule (MPFS) final rule. They finalized a number of critical changes to the Medicare payment system, including new and improved payments for the delivery of advanced Primary Care, additional financial support for Accountable Care Organizations serving under-resourced communities, and extension of incentive payments to encourage providers to adopt alternative payment models. Through adoption of this rule, CMS takes critical steps to improving the health care payment system and helping drive the delivery of the affordable, high quality and equitable care that our nation's families need and deserve.
Calendar Year 2025 Outpatient Prospective Payment System Final Rule - CMS
CMS released the CY 2025 Outpatient Prospective Payment System (OPPS) final rule, bringing key changes to the Medicare payment system to drive the delivery of high quality and equitable care. Included within the final rule is the following:
1) establishing national health and safety standards for the first time for the delivery of obstetric services to meet the health needs of moms and babies.
2) enacting new quality measure reporting requirements to ensure hospitals' deliver equitable care, including assessing a patients' health related social needs.
3) expanding Medicare access to people who were formerly incarcerated.
In this rule, CMS did not strengthen hospital price transparency rules or expand same service same price policies.
Increasing Organ Transplant Access (IOTA) Model Final Rule - CMS
CMS released the Increasing Organ Transplant Access Model (IOTA) Model final rule. The model aims to increase access to kidney transplants for people living with end-stage renal disease (ESRD). As finalized, IOTA will be a mandatory model for half of transplant hospitals, beginning July 25, 2025. The final rule made several modifications to the proposed rule, including the removal of the health equity adjustment provision and changes to the quality measure set, as was recommended by Families USA in our comment letter. CMS did not replace the health equity adjustment or quality measure set with alternative solutions, but has indicated they will continue to address this model through future rulemaking.
States Advancing All-Payer Health Equity Approaches and Development (AHEAD) Model Participants Announced - CMS
CMS announced participants in the States Advancing All-Payer Health Equity Approaches and Development (AHEAD) Model across three cohorts. Cohort 1, consisting of Maryland and Vermont, will begin their first performance year in 2026 and operate through 2034. Cohort 2, consisting of Connecticut and Hawaii, and Cohort 3, consisting of Rhode Island and five New York counties, will each run from 2027 to 2034. Participants in the AHEAD Model will receive upfront payments that cover the total cost of care for all patients and in turn must assume responsibility for managing health care quality and cost across all payers. The goals of the model are to curb health care cost growth, improve population health, and advance health equity by reducing disparities in health outcomes.
Medicare Shared Savings Program Continues to Deliver Meaningful Savings and High-Quality Health Care - CMS
CMS announced this week that the Medicare Shared Savings Program (MSSP) resulted in more than $2.1 billion in net savings and $3.1 billion in shared savings payments for participating Accountable Care Organizations (ACOs) in 2023. MSSP is the largest alternative payment model operating today, responsible for paying 480 participating Accountable Care Organizations (ACOs) and 608,000 clinicians who deliver care to nearly 11 million people with Medicare. This is the 7th straight year that MSSP reported savings. In addition, MSSP ACOs scored better on many quality measures than physicians not affiliated with MSSP, and demonstrated continued quality improvement.
Not All Selected Hospitals Complied With the Hospital Price Transparency Rule – Office of the Inspector General (OIG)
The Office of the Inspector General (OIG) released a report that details the results of an audit on hospitals for compliance with the Hospital Price Transparency (HPT) Rule. This rule requires that hospitals’ lists of standard charges be made available to the public via the internet in a machine-readable format and that hospitals update this information annually. The audit found that roughly 46% of hospitals did not meet the HPT standards, suggesting that more work must be done to ensure consumers can access a list of hospital prices and make informed choices about the cost of medical care.
Medicare Advantage: Questionable Use of Health Risk Assessments Continues to Drive Up Payments to Plans by Billions – Office of the Inspector General
The Office of the Inspector General (OIG) released a new report on Medicare Advantage (MA). OIG investigated two sources of enrollee diagnoses – health risk assessments (HRAs) and chart reviews – that were particularly vulnerable to misuse by Medicare Advantage plans. They found that diagnoses reported only on HRAs and chart reviews were responsible for more than $7.5 billion in MA payments. Additionally, just 20 MA companies drove 80% of those payments, suggesting intentional misuse and abuse of the system. OIG recommends that CMS impose additional restrictions on the use of diagnoses only reported on HRAs or chart reviews to prevent further abuse.
Medicare $2 Drug List Model- Request for Information (RFI) - CMS
CMS has announced a new Request for Information regarding the Medicare $2 Drug List Model. The Innovation Center’s Medicare $2 Drug List Model proposes testing whether a simplified approach to offering low-cost generic drugs can improve medication adherence, yield better outcomes, and increase beneficiary and prescriber satisfaction. Specifically, the model will enable Medicare Part D sponsors to offer a standard set of generic drugs at a fixed copayment of up to $2 for a month’s supply. CMS is asking interested parties to provide input on specific aspects of the model, including: $2 Drug List development, maximizing plan participation, CMS outreach, and sponsor outreach. Comments are due back to CMS by December 9, 2024.
