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12.24.19

Health care regulations to watch in 2020

BY April E. Schweitzer

The fourth quarter of this year saw several proposed and finalized rules in the health care space. As we look ahead to 2020, I've outlined some of the most impactful changes that health care organizations should watch for in the new year.

Medicaid Fiscal Accountability Regulation (MFAR)

In response to the rapid growth of the federal share funding of the Medicaid program in recent years, the Centers for Medicare and Medicaid Services (CMS) published a proposed rule overhauling Medicaid fiscal accountability measures at the federal and state levels. MFAR's stated goal is to strengthen the Medicaid program's overall fiscal integrity by focusing on four areas of vulnerability: Medicaid fee-for-service provider payments and supplemental payments, disproportionate share hospital payments, Medicaid program financing mechanisms, and health care-related taxes and provider-related donations.

Given Medicaid's joint funding mechanism, the final rule is likely to be controversial. Legal and political efforts to prevent implementation are expected. Providers and their industry associations should consider providing comments—with specific details of anticipated adverse impacts—before the January 17, 2020 deadline.

Hospital price transparency

Despite staunch opposition from the industry, CMS issued final regulations on price transparency. The new rule broadly requires hospitals to make public their prices for hundreds of items and services, including their payer-specific negotiated rates with commercial, Medicare, and Medicaid managed care payors. The new regulations are promulgated pursuant to Section 10001 of the Affordable Care Act, which requires hospitals to "establish (and update) and make public . . . a list of the hospital's standard charges for items and services provided by the hospital." Hospital trade associations declared that they will challenge the requirements in federal court.

Stark and AKS proposed rules

On October 17, 2019, the U.S. Department of Health and Human Services (HHS) published two proposed rules in the Federal Register that could transform key federal laws restricting health care arrangements. The revised rules address perceived or actual barriers to care coordination and value-based care under the federal physician self-referral law (Stark Law), the federal health care program Anti-Kickback Statute (AKS), and the federal beneficiary inducements Civil Monetary Penalty Law (CMP). In promulgating the proposals, HHS intends to "modernize and clarify" the regulations that implement and interpret these laws to drive innovation and move towards a more affordable health care delivery and payment system, while still maintaining guardrails to prevent overutilization and fraud and abuse.

HHS recognizes that the broad reach of the current Stark law, AKS, and CMP potentially inhibit arrangements in the health care industry that advance the transition to value-based care, enhance care coordination, improve quality, and reduce waste. Given the significant opportunities that these changes may bring if finalized, providers and managed care organizations should pay close attention to these proposals.

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April E. Schweitzer

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