Key Similarities and Differences Between the House and Senate Payment Reform Bills

After two years of discussion and debate, the Massachusetts Legislature must now deal with two huge pieces of payment reform and cost control legislation.

Earlier this week, the House passed its legislation by a wide margin, following eight hours of deciding which of 275 amendments it would accept. The Senate passed a separate bill on May 17.

During the House debate this week, the MMS sought to protect most small and medium physician groups from the House’s very rigorous reporting requirements. The original House bill exempted groups with fewer than 10 physicians. Due to MMS advocacy, the House agreed to increase the exemption to 25, which we will try to increase further during the conference committee’s deliberations.

When the members of the conference committee are appointed, they will have until adjournment on July 31 to agree on a single bill and get it passed by both chambers.

Despite their many similarities, reconciliation and consolidation of the bills is not expected to be an easy task.

Key Similarities

  • Cost containment: Each bill states that overall health care costs should rise in concert with the growth in the state’s economy. (Differences noted below.)
  • State oversight: Each creates a new state agency to certify provider groups, and collect volumes of information on quality measures and costs. The House agency is placed inside the executive branch, under the Executive Office of Health and Human Services. The Senate agency is an independent entity.
  • Market power: Both bills require payers to negotiate separate contracts for each hospital facility, with some exceptions.
  • Alternative payment models: The bills define ACOs and their requirements. They provide a 2 percent bonus in Medicaid payments to providers starting in July 2013, if they move to alternative payment methodologies.
  • Electronic Health Records: Each requires physicians to be proficient in the use of electronic medical records. (Differences noted below.)
  • Medical liability: Both mandate waiting periods for civil suits brought against health care providers. They require disclosure of case information to patients and providers; protect statements of apology from being admissible as evidence; provide for early payments to patients without prejudice. They reduce the prejudgment interest rate in malpractice cases from 4 percent to 2 percent. No contract may prohibit a physician from serving as an expert witness.
  • Determination of Need: They expand the Determination of Need process to include more new technologies, transfers of ownership and site expansions.
  • Administrative simplification: Both bills require standards forms for utilization review.
  • Peer review: Both bills expand the peer review statute. The House specifically provides ACOs with peer review protection; the Senate provides such protections to any provider group that conducts peer review activities.
  • Charitable immunity: They raise the charitable immunity cap from $20,000 to $100,000 (affects most hospitals in Massachusetts).
  • Physician assistants and nurse practitioners: Each bill provides more independence to physician assistants and nurse practitioners.
  • Limited service clinics: Both bills eliminate some existing regulations for the operation limited service clinics, such as those located in pharmacies; however their approaches differ.

Key Differences

Cost Containment

  • The House’s benchmark is 3.6 percent for 2012 and 2013. In 2014 and 2015, it would be equal to the growth rate projected in the Governor’s budget submissions. From 2016 to 2026, it would be equal to a half percentage point below the Gross State Product (GSP) from 2016 to 2026, and equal to one point above GSP after 2027.
  • The Senate’s cost benchmark is a half point above GSP through 2015, and equal to GSP from 2016 to 2026.
  • The House imposes a penalty on providers who costs are 20 percent higher than the benchmark. It establishes rate setting for governmental units. The House gives the state the ability to force providers to reopen contracts that it considers contributing to excessive spending. The House gives the attorney general to block unreasonable increases in rates, and block changes that adversely affect patient access and the quality of care. In the Senate bill, groups that exceed the benchmark must file improvement plans.

Market power

  • The House subjects provider groups of 10 or more physicians to a market impact review.
  •  The Senate gives the attorney general the power to prevent excess consolidation and collusion.

Certification

  • The House requires any physician group with 25 or more physicians to be certified by the Department of Public Health.
  • The Senate requires certification for all providers entering into alternative contracts. It exempts groups with less than $500,000 in annual net patient service revenue and fewer than five affiliated physicians, if the group does not accept risk.

Electronic Health Records

  • The House requires providers to adopt EHRs that are fully interoperable and connect to the statewide health information exchange.
  • The Senate updates existing the requirement for EHR proficiency by 2015 by requiring physicians must demonstrate the skills to comply with the federal government’s meaningful use requirements. It creates an institute to facilitate the implementation of interoperable records statewide, and promote the use of other health information technologies.
  1. THE LEADERSHIP REALLY NEEDS GREAT COMMENDATIONS FOR PASSING ON THE INFORMATIONS AS HAS BEEN DONE
    MANY THANKS
    ONE THOUGHT I HAVE IS TO HAVE TEACHING WORK STATIONS FOR MEMBERS AND NON MEMBERS — HOW TO PROCEED WITH MEANINGFUL USE CORE , MENU
    EXEMPTIONS ATTESTATIONS ETC
    JULY THRU SEPTEMBER IS VERY CRUCIAL
    WILL ALSO HELP INCREASE IN MEMEBERSHIPS
    MAY BE NEED DIFFERENT WAYS
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    YOU MAY BE DOING IT I DO NOT KNOW
    THANKS
    DINESH

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