Health Care Reform Implementation Update

by Cozen O'Connor

Congress begins its summer recess this week, but last week legislators were busy holding hearings on management issues regarding, introducing legislation to increase payments to primary care doctors under Medicaid, and voting to support House Speaker John Boehner’s lawsuit challenging President Obama’s constitutional authority to delay the employer mandate. Also last week, the Centers for Medicare and Medicaid Services (CMS) released final rules on the 2015 Medicare payment rates for skilled nursing facilities, inpatient rehabilitation facilities, and inpatient psychiatric facilities and officially extended the deadline of the ICD-10 coding system to October 1, 2015, and trustees for the Medicare trust fund released a positive update on Medicare’s financial outlook. 


On July 30, Senators Patty Murray (D-Wash.) and Sherrod Brown (D-Ohio) introduced a bill that would extend the increase in payments to primary care doctors who treat Medicaid patients. A provision in the ACA implemented payment increases to these physicians to match their rates with Medicare rates through the end of 2014. This bill would extend those payment increases for another two years and would also increase the payment rates for nurse-midwives, nurse practitioners and physician assistants who often act as primary care providers for Medicaid patients. 

In a report released on July 30, the Government Accountability Office (GAO) identified major mistakes made in the management of the contractors responsible for the creation and launch of the federal ACA exchange website The report provides specific examples of how and why increased costs and schedule problems were attributed to “changing requirements and inconsistent oversight” within CMS. On Thursday July 31, the House Energy and Commerce Oversight and Investigations Committee questioned CMS officials about the report. Many of the questions from members focused on the cost of these “flaws.” The cost of the contract to the main contractor overseeing the site, Accenture, grew from $91 million in January to more than $175 million.

On July 30, the House voted to support Speaker John Boehner’s lawsuit against President Obama. The lawsuit challenges that the president violated his constitutional authority when he delayed the employer mandate under the ACA. The final vote was 225-201.

On July 29, Katherine Iritani, director of Health Care at the GAO appeared before the House Oversight and Government Reform Subcommittee on Health to discuss a GAO study that calls for increased oversight of Medicaid financing. According to Director Iritani, states are using methods that may be inconsistent with federal requirements to receive federal matching funds for state Medicaid programs. Although Iritani agreed that the states participating in these types of payment practices are not violating the law, she did testify that increased reporting requirements and oversight are needed to ensure that states are complying with all regulations and using legitimate methods to obtain federal matching funds for Medicaid. 


On July 31, HHS posted a final rule that officially extends the deadline for implementation of the ICD-10 coding system to October 1, 2015. The ICD-10 coding system had been slated for implementation on October 1, 2014, but HHS previously indicated it would extend this deadline after input from health care industry stakeholders requesting an extension. 

CMS released its final rule regarding 2015 Medicare payment rates for skilled nursing facilities, inpatient rehabilitation facilities and inpatient psychiatric facilities on July 31. All of these types of facilities will see Medicare payment increases, and the rates are nearly identical to the rates CMS proposed in May. For fiscal year 2015, skilled nursing facilities will see a 2 percent increase in Medicare rates, inpatient rehabilitation providers will receive a 2.4 percent increase in rates, and inpatient psychiatric facilities will receive a 2.5 percent increase in Medicare payments.

On July 28, trustees for the Medicare trust fund reported that the financial outlook for Medicare has improved. White House officials touted the ACA as the reason for the improved financial outlook, but trustees neglected to affirm this claim. According to the report, Medicare funding will run out four years later than previously expected. 

On July 29, CMS announced that it will extend a temporary moratorium on the Medicare enrollment of home health care agencies and ambulance providers in certain locations for another six months. Under a provision in the ACA, CMS has the authority to suspend enrollment of these providers in an effort to control fraud and abuse. This announcement extends the moratorium for home health and ambulance providers in specific locations within Florida, Illinois, Michigan, Texas, Pennsylvania and New Jersey. CMS has enacted this same moratorium in Philadelphia, Detroit, Dallas, Miami, Chicago and Houston. 

On July 29, HHS made an announcement regarding a provision in the ACA that gradually closes the gap in coverage that forces Medicare beneficiaries to pay some out of pocket prescription costs. According to the data from HHS, seniors have saved $11.5 billion in prescription drugs since the ACA was implemented in 2010. The gradual decrease of this so-called “donut-hole” will occur until 2020. 


On July 29, the U.S. Court of Appeals for the District of Columbia denied a lawsuit by the Pacific Legal Foundation that claimed the ACA was unconstitutional because the legislation did not originate in the House. The Origination Clause of the U.S. Constitution requires that any bill that would raise revenue be introduced in the House. The judge in this case ruled against this claim by arguing that raising revenue was not the intent of the ACA and therefore the Origination Clause did not apply in this case. 

West Virginia’s Attorney General Patrick Morrissey filed a lawsuit against President Obama claiming the president overstepped his authority when his administration instituted a “fix” that allowed people to keep health plans that did not meet the law’s minimum coverage standards and required states to determine whether a health plan adheres to requirements under the ACA. The lawsuit alleges that the ACA requires the federal government to make such determinations and that this fix is an overreach of President Obama’s power. 


On July 25, New Mexico’s health exchange board announced that it will not launch its own exchange for the upcoming November 2015 ACA open enrollment period. New Mexico will use the federally run exchange via for another year.

On July 29, it was reported that CMS is seeking to recoup $1.3 billion in Medicaid funds from New York state. According to CMS, New York did not provide adequate justification for these costs, and the state did not comply with federal reporting requirements. The funds in question were distributed to the state in 2010. Governor Cuomo (D-N.Y.) has promised to appeal the decision.


The American Medical Association (AMA) has notified CMS that it has a number of issues regarding the Sunshine Act, specifically with the database that tracks payments made to doctors from manufacturers and teaching hospitals. The payment database was created by an ACA provision that is intended to increase transparency of physician payments. The data is slated to go public on September 30, 2014, and providers have until August 27 to review and verify the data. According to the AMA, the database portal has numerous technical glitches and burdensome login issues, and the provider group is requesting a delay of the public release of the data.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Cozen O'Connor | Attorney Advertising

Written by:

Cozen O'Connor

Cozen O'Connor on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.