- CRISIS STANDARDS OF CARE: DISCRIMINATION IN MEDICAL RATIONING IN THE TIME OF COVID-19
Special Guest Presentation by Regan Bailey, Litigation Director, Justice in Aging
Since the beginning of the pandemic, health care professionals have been concerned that there will be a lack of acute care services and equipment, notably ventilators, to meet the increasing demand as cases increase and hospitals become overwhelmed. In in response to this concern, some states and medical professionals have developed guidance and protocols for rationing acute medical care to help determine who will have access to life-saving treatment when there is a limited supply. Even though the language of these plans may appear facially neutral, many of them have relied on discriminatory age and disability-based distinctions.
The Center for Medicare Advocacy has been involved in a coalition effort, along with disability rights advocates and advocates representing older adults, to ensure that, if the current pandemic results in decisions to ration treatment, allocation decisions are made without discriminating based on disability or age.
On the last Alliance call in July, we provided an update on advocacy to date, including the Crisis Standards of Care in Massachusetts, and our advocacy efforts in that state (July 2020 Center for Medicare Advocacy Medicare Advocates Alliance Call discussion of issue: https://medicareadvocacy.org/issue-brief-july-2020-medicare-and-covid-19-updates-other-issues/)
For the September Alliance call we are pleased to welcome Regan Bailey from Justice in Aging, a leader in this effort, to provide an update.
- July 2020 Center for Medicare Advocacy Medicare Advocates Alliance Call discussion of issue: https://medicareadvocacy.org/issue-brief-july-2020-medicare-and-covid-19-updates-other-issues/
- CMA Alert July 16, 2020 on Medical Rationing: https://medicareadvocacy.org/advocacy-update-medical-rationing/
- COVID-19 and Medicare
- Latest General Updates
The global COVID-19 crisis has led to many changes in health care rules, including in the Medicare program. Most of the Medicare-related changes have been made retroactive to March 1, 2020, and will last until the Public Health Emergency (PHE) related to the COVID-19 crisis is lifted. Most recently, the PHE was extended on July 23, 2020 for an additional 90 days, through late October 2020.
Many of these Medicare changes are summarized in the Center’s publication “COVID-19: AN ADVOCATES GUIDE TO MEDICARE CHANGES” (updated July 29, 2020).
- Impact on Medicare Finances
On August 8, 2020 President Trump issued four documents – one executive order and three memoranda – aimed at unemployment aid, eviction protection, student loan relief, and deferral of payroll tax payments.
Of the actions taken by the President, the Center is particularly concerned about repercussions for Medicare and Social Security from deferring payroll taxes. (Directives concerning the payroll tax were included in a document entitled Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster, August 8, 2020.) This document attempts to defer payroll tax payments (retroactively to August 1) through December, for individuals earning less than $100,000. The memorandum also directs the Treasury Secretary to “explore avenues, including legislation, to eliminate the obligation to pay the taxes deferred.”
Payroll taxes fund key components of Social Security and Medicare Part A. While the current deferral only applies to the Social Security portion of the payroll tax, as the President signed these executive actions, he vowed that, if re-elected, he would seek to extend the payroll tax deferral and pursue a permanent cut to payroll taxes.
- For more information, see the Center’s Weekly Alert “With Next COVID Relief Bill Stalled, President Trump Issues Directives of Questionable Authority and Threatens Social Security and Medicare” (August 13, 2020) available at: https://medicareadvocacy.org/with-next-covid-relief-bill-stalled-president-trump-issues-directives-of-questionable-authority-and-threatens-social-security-and-medicare/.
In the meantime, the financial impact of the COVID-19 pandemic is starting to take shape. On September 3, 2020, the Kaiser Family Foundation (KFF) posted a policy update entitled “Medicare’s Finances Have Gotten Much Worse in Recent Years, Foreshadowing Tough Choices for November’s Winners” wherein they noted that according to the latest estimates of the Congressional Budget Office (CBO), the Part A Trust Fund “will have insufficient funds to cover all benefit costs beginning in 2024 – just four years from now, and sooner than last year’s projected depletion date of 2026.”
According to KFF, “[t]he outlook for the Medicare HI trust fund has worsened in recent years due to a combination of factors, including the economic impact of COVID-19 on payroll tax revenue and several laws enacted by Congress and signed into law by President Trump that either increased Medicare spending or reduced revenues, including legislation that cut taxes and repealed the Independent Payment Advisory Board, the ACA individual mandate penalty, and the ‘Cadillac tax’.”
- For more information, see the Center’s Weekly Alert “Medicare’s Finances – Challenges and Solutions” (September 10, 2020), available at: https://medicareadvocacy.org/medicares-finances-challenges-and-solutions/.
Telehealth – Although the country is still in the midst of the COVID-19 crisis, some stakeholders are already pushing to permanently extend many of the new flexibilities in the Medicare program particularly with respect to telehealth. Some advocates have concerns about efforts to make telehealth flexibilities permanent, without careful study and evaluation concerning the expansions—including the types of services being provided; consumer participation and utilization barriers; changes in program and beneficiary spending; quality measures, including patient satisfaction; as well as impacts on beneficiary health and any disparities. Further, policy decisions made without this critical information could fundamentally change the care delivery landscape for people with Medicare in unanticipated, and potentially unwelcome, ways.
- For more information, see, e.g., the Center’s Weekly Alert “Joint Principles from Center for Medicare Advocacy and Medicare Rights Center: Medicare Expansion of Telehealth Helps Beneficiaries Access Care During the Pandemic – But Caution is Needed Before Making These Changes Permanent” (July 23, 2020), available at: https://medicareadvocacy.org/joint-principles-from-center-for-medicare-advocacy-and-medicare-rights-center-medicare-expansion-of-telehealth-helps-beneficiaries-access-care-during-the-pandemic-but-caution-is-needed-bef/
U.S. Postal Service and Delivery of Prescription Drugs – On September 9, 2020, U.S. Senators Bob Casey and Elizabeth Warren released a report entitled “Rapidly Increasing Postal Service Delivery Delays for Mail-Order.” The report focuses on recent operational changes made at the U.S. Postal Service (USPS) and concludes that “there have been significant delays in USPS deliveries of mail-order prescription drugs in recent months, potentially posing serious health risks to millions of Americans and increasing costs for consumers and taxpayers.” At the same time that there has been a 20% increase in prescription drugs filled through mail-order during the pandemic, there have been “significant and increasing delays in the delivery of mail-order prescription drugs in the summer of 2020.”
- For more information, see the Center’s Weekly Alert “Senators Release Report Concerning Postal Service Problems and Delays in Receipt of Mail-Order Drugs” (September 10, 2020), available at: https://medicareadvocacy.org/senators-release-report-concerning-postal-service-problems-and-delays-in-receipt-of-mail-order-drugs/.
- Nursing Home Issues
Focused infection control surveys
Since suspending the standard survey process in March, CMS has directed surveyors to conduct focused (or targeted) infection control surveys at nursing facilities (and also to investigate complaints and facility-reported incidents that the state triages as immediate jeopardy).
CMS made the first batch of targeted infection control surveys publicly available in June and has continued to update the list of facilities surveyed on the last Wednesday of the month. The Center has been analyzing these reports each month.
Essentially, we have found that few facilities are actually cited with deficiencies and that most deficiencies are called no harm. For example, On August 26, 2020, CMS made public the fourth cumulative release of 25,593 targeted infection control surveys, covering the period March 4 through July 31. The surveys cited 556 infection prevention and control deficiencies in 539 facilities (524 facilities were cited with one deficiency, 13 facilities were cited with two deficiencies, and two facilities were cited with three deficiencies).
Of the 556 infection control deficiencies, 48 deficiencies (8.6%) were cited at the immediate jeopardy level.
Although all four releases of infection control surveys and deficiencies show that less than 3% of focused infection control surveys cited deficiencies, an increasing percentage of these deficiencies has been classified as immediate jeopardy.
|Date of CMS Release||Number of Surveys||Number (%) of infection control deficiencies cited||Number (%) of infection control deficiencies classified as immediate jeopardy|
|June 4||5,724||163 (2.8%)||1 (1.0%)|
|June 24||9,899||262 (2.6%)||4 (1.5%)|
|July 29||16,987||347 (2.0%)||22 (6.6%)|
|August 26||25,593||556 (2.2%)||48 (8.6%)|
However, most deficiencies are still classified as no harm (which means an financial penalty is unlikely to be imposed):
CMS announced on August 14 that it imposed more the $15 million in CMPs at more than 3,400 facilities. The Center has looked at the targeted infection control surveys and a second CMS database that is publicly available, qcor.cms.gov. Neither database reports these surveys (although some newspapers have been reporting additional infection control deficiencies and CMPs that are not identified on the databases). CMS told resident advocates that the database where the August 14 information appears is internal.
There are many reasons why focused infection control surveys have cited so few deficiencies. In March, CMS told surveys to spend as little time as possible on-site and to do as much off-site as possible. Some surveys have been extremely abbreviated (one surveyor conducting multiple surveys in a single day). The focused infection control survey protocol did not require that surveyors look at a sample of residents (to us, the essence of the survey process).
When CMS “restarted” the survey process (see August 17 memorandum), it required surveyors to look at a sample of three residents and a sample of three staff members. This change in the survey protocol may lead to the citation of more deficiencies.
Please go to: CMA, “What’s New in Infection Control Surveys for Nursing Facilities?” (CMA Alert, Sep. 3, 2020), https://medicareadvocacy.org/whats-new-in-infection-control-surveys-for-nursing-facilities/.
CMA, “Responding to CMS Announcement on Nursing Home Enforcement – Infection Control Deficiencies in Nursing Facilities, QCOR Data” (CMA Alert, Aug. 20, 2020), https://medicareadvocacy.org/responding-to-cms-announcement-on-nursing-home-enforcement-infection-control-deficiencies-in-nursing-facilities-qcor-data/.
CMS, “Enforcement Cases Held during the Prioritization Period and Revised Survey Prioritization,” QSO-20-35-ALL (Aug. 17, 2020), https://www.cms.gov/files/document/qso-20-35-all.pdf.
CMS’s Coronavirus Commission for Safety and Quality in Nursing Homes issued its final report in September.
The Report identifies 27 recommendations and more than 100 action steps that are organized into 10 themes. The recommendations address testing and screening, equipment and personal protective equipment, cohorting, visitation, communication, workforce ecosystem, workforce system, technical assistance and quality improvement, facilities, and data. Eleven of the Commission’s 25 members express reservations about one or more of the recommendations. Eric Carlson of Justice in Aging dissents from the entire Report. CMS states that the Report validates the federal response to the coronavirus pandemic, issuing a point-by-point comparison of the Commission’s recommendations and the agency’s actions.
The Center for Medicare Advocacy considers the Report too generous to nursing facilities and the federal government. The Report essentially treats nursing facilities as having no responsibility for the tens of thousands of resident and staff deaths. The Report also fails to fault the lack of federal direction and accountability, both before and during the pandemic.
Go to: CMA, “CMS Long-Term Care Commission Issues Report” (CMA Alert, Sep. 17, 2020), https://medicareadvocacy.org/cms-long-term-care-commission-issues-report/.
Changes to survey and enforcement activities
On August 17, CMS revised its June guidance to authorize additional onsite surveys at nursing facilities and to restart the survey and enforcement systems.
In March, CMS suspended all enforcement actions, “with the exception of unremoved IJs [immediate jeopardies]” (QSO-20-20-All). Revisits to end an ongoing enforcement cycle – including stopping denial of payment for new admissions and per day civil money penalties – were suspended. In the August 17 memorandum, CMS says that it “intends to resolve those enforcement cases that were suspended and provide guidance for closing them out, going forward from the issuance of this memorandum [bold font supplied].”
The August memorandum identifies four components of the process to resume survey and enforcement activities: expanded desk review policy and methods for processing enforcement cases in three categories (cases started before March 23; cases started March 23-May 31; and cases started on or after June 1, 2020).
Please go to:
CMS, “Enforcement Cases Held during the Prioritization Period and Revised Survey Prioritization,” QSO-20-35-ALL (Aug. 17, 2020), https://www.cms.gov/files/document/qso-20-35-all.pdf.
CMA, “CMS Restarts Survey and Enforcement Activities at Nursing Facilities” (CMA Alert, Aug. 27, 2020), https://medicareadvocacy.org/cms-restarts-survey-and-enforcement-activities-at-nursing-facilities/.
The last few weeks have seen two instances of a shift in CMS’s approach to the pandemic: actual requirements (which are at least potentially enforceable) instead of just recommendations and suggestions.
Testing of residents and staff
On September 2, 2020, CMS published an interim final rule with comment that, effective immediately, sets standards and requirements for nursing facilities to test residents and staff during the pandemic. 42 C.F.R. §483.80(h)(1)-(6). The detailed rule requires facilities to test residents and staff according to parameters identified by the Secretary and consistent with current standards of practice; to document each test and its results; to take actions to prevent the transmission of COVID-19 when a resident or staff member tests positive; to have procedures when residents or staff refuse testing; and to contact state and local health departments when they experience shortages in testing supplies or processing tests results.
Facilities can choose the kinds of tests they want to use.
Guidance on testing, issued August 26 (the day after the interim final rule went on display), provides unusually prescriptive guidance for each of the new regulatory requirements.
Table 1 identifies triggers for mandatory testing of staff and residents.
Table 1: Testing Summary
|Symptomatic individual identified||Staff with signs and symptoms must be tested.||Residents with signs and symptoms must be tested.|
|Outbreak (Any new case arises in facility)||Test all staff that previously tested negative until no new cases are identified.*||Test all residents that previously tested negative until no new cases are identified.*|
|Routine testing||According to Table 2 below||Not recommended, unless the resident leaves the facility routinely.|
*For outbreak testing, all staff and residents should be tested, and all staff and residents that tested negative should be retested every 3 days to 7 days until testing identifies no new cases of COVID-19 infection among staff or residents for a period of at least 14 days since the most recent positive result.
Table 2 identifies testing intervals for staff, based on “the extent of the virus in the community.” Id.
Table 2: Routine Testing Intervals Vary by Community COVID-19 Activity Level
Community COVID-19 Activity
|County Positivity Rate in the past week||Minimum Testing Frequency|
|Low||<5%||Once a month|
|Medium||5% – 10%||Once a week*|
|High||>10%||Twice a week*|
* This frequency presumes availability of Point of Care testing on-site at the nursing home or where off-site testing turnaround time is <48 hours.
Testing is complex for COVID-19 because people may be contagious while asymptomatic. Residents may not have the symptoms that are typical of coronavirus in younger people. Who gets tested and when and with what kinds of tests is a significant issue, which we discussed in an Alert.
Please go to: CMS, “Medicare and Medicaid Programs, Clinical Laboratory Amendments (CLIA), and Patient Protection and Affordable Care Act; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency,” CMS-3401-IFC, https://www.govinfo.gov/content/pkg/FR-2020-09-02/pdf/2020-19150.pdf.
CMS, “Interim Final Rule (IFC), CMS-3401-IFC, Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency related to Long-Term Care (LTC) Facility Testing Requirements and Revised COVID-19 Focused Survey Tool,” QSO-20-38-NH (Aug. 26, 2020), https://www.cms.gov/files/document/qso-20-38-nh.pdf.
CMA, “Testing Nursing Home Residents for COVID-19” (CMA Alert, Sep. 10, 2020), https://medicareadvocacy.org/testing-nursing-home-residents-for-covid-19/.
In new guidance issued September 17, 2020 and effective immediately, CMS prohibits nursing facilities from restricting visitors unless there is a “reasonable clinical or safety cause.” For the first time since the national health emergency was declared, CMS requires facilities to allow and support visits, both outdoor and indoor, so long as facilities use a person-centered approach and visitors adhere to core principles of infection prevention, which CMS sets out in the memorandum. The new policy explicitly supersedes and replaces guidance that CMS issued in March (barring all visitors) and updated in May and June.
The length policy memorandum addresses visitor testing, expands examples of compassionate care visits, and discusses access to residents for the long-term care ombudsman, Protection & Advocacy Program representatives, and non-employee health care workers. CMS expands opportunities for communal activities and dining for residents and authorizes facilities to use up to $3000 from civil money penalty funds to help facilitate in-person visits.
CMS describes how surveyors should cite noncompliance with the visitation and infection control requirements.
Please go to: CMS, “Nursing Home Visitation – COVID-19,” QSO-20-39-NH (Sep. 17, 2020), https://www.cms.gov/files/document/qso-20-39-nh.pdf.
- UPCOMING MEDICARE ENROLLMENT PERIOD & 2021 UPDATES
- Upcoming Medicare Enrollment Period
The Annual Coordinated Election Period (ACEP) – the period during which individuals with Medicare can make coverage elections for the following year – will start October 15th and last until December 7th.
- Medicare Plan Finder (MPF) updates
As discussed during previous Alliance calls, in 2019, CMS rolled out an updated Medicare Plan Finder (MPF). There were a number of problems, ranging from the timing of the roll-out, functionality, and errors in information on the website. CMS has tried to address some of these problems:
- Updates in 2020 have included:
- Changed the default sort option from lowest premium to lowest yearly drug + premium cost
- Updated the design of the summary plan card
- “Back-end changes to the data sources that feed the Plan Finder, so the data that displays is now more accurate and refreshed more frequently” per CMS (e.g. plan data updated daily v. weekly)
- Planned updates include (prior to ACEP):
- Medigap tool with data updated weekly (using same SHIP data source)
- Additional drug refill frequency options (6 mos., 1 year)
- Pharmacy search will be improved, including the ability to find pharmacies by name and distance, as well as map usability and functionality
- New search filters for plans (incl. plan type, participation in insulin cost model)
- Add cost-sharing for dialysis
- See CMS (5/12/20) memo at: https://www.ritterim.com/documents/cy_2021_mpf_hpms_updates_final_05122020.pdf
- Longer-term fixes
- Not bringing back anonymous drug IDs, but looking at “updating account management systems”
- Implementing an MA provider search directory
- PDF generation, sharing pages
- Problems with printing and inability to save reports as a PDF which can be emailed (e.g., to SHIP clients) impacts remote counseling
- Medicare & You – 2021 – Ongoing Bias in Favor of Medicare Advantage (MA)
As discussed on previous Alliance calls, since Fall 2017, the Center has expressed concerns about bias towards Medicare Advantage in CMS materials, including outreach and enrollment materials, email campaigns and the 2018, 2019 and 2020 Medicare & You handbooks.
CMS recently posted the Medicare & You 2021 handbook on their website. The Center reviewed the new handbook with an eye toward assessing the balance of information provided about Original Medicare vs. Medicare Advantage, and the accuracy of information regarding coverage. Similar to what we found in our review of the 2020 handbook in our September 2019 Weekly Alert published last year, in short, while there have been general improvements in the handbook, bias towards Medicare Advantage remains, and in some ways, has gotten worse. Enrollment in MA plans is promoted at the same time that important restrictions and challenges faced when enrolling in an MA plan are downplayed or omitted.
On September 18, 2020, the Center for Medicare Advocacy released an Issue Brief titled “Medicare & You 2021 – An Assessment of Bias in Favor of Medicare Advantage” which provides an in-depth analysis of the new handbook and the ways in which it treats Medicare coverage options in a way that is not balanced or neutral, as it should be.
- 2021 Updates
- Medicare Advantage (MA) Issues
MA Network Adequacy Rules Weakened
Network adequacy rules exist in order to ensure that enrollees of MA plans that restrict access to services to a contracted network of providers are able to still access essential services. CMS guidance for assessing network adequacy includes criteria such as provider and facility specialty types that must be available consistent with certain number, time, and distance standards. 42 C.F.R. §422.116.
On June 2, 2020, the Centers for Medicare & Medicaid Services (CMS) published a final rule regarding Medicare Advantage (Medicare Part C) and Part D prescription drug plans (“C & D Rule”) entitled “Medicare Program; Contract Year 2021 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, and Medicare Cost Plan Program” at 85 Fed Reg 33796 (June 2, 2020), available at: https://www.govinfo.gov/content/pkg/FR-2020-06-02/pdf/2020-11342.pdf.
In the final rule, CMS reduced the percentage of beneficiaries that must reside within the maximum time and distance standards in non-urban counties from 90 percent to 85 percent in order for an MA plan to comply with network adequacy standards. CMS also allows plan sponsors to meet weaker standards if they provide certain services via telehealth. Further, CMS provides a credit towards meeting time and distance standards for affected providers in states that have certificate of need (CON) laws.
- For an analysis of the final rule, see, e.g. Center for Medicare Advocacy Weekly Alert “Final Rule for Medicare Parts C and D Includes Weakened Standards for Medicare Advantage Networks” (May 28, 2020), available at: https://medicareadvocacy.org/final-rule-for-medicare-parts-c-and-d-includes-weakened-standards-for-medicare-advantage-networks/
ESRD and Medicare Advantage
Section 17006 of the 21st Century Cures Act (Pub. L. No. 114-255), signed into law by President Obama on December 13, 2016, removed the barrier for people with End Stage Renal Disease (ESRD) to enroll in MA plans beginning in 2021. The C & D rule discussed above includes implementing regulations concerning this change.While this change in law significantly improves coverage options for people with ESRD, their options still remain limited. Congress failed to extend federal Medigap rights to people with ESRD at the same time it removed prohibitions on enrollment in MA (note that some state Medigap law do allow such enrollment).
Through the final rule, CMS has also eliminated time and distance limits from network adequacy requirements for dialysis facilities. Specifically, CMS has removed outpatient dialysis as a facility specialty type at 42 C.F.R. § 422.116(b)(2) that is subject to network adequacy standards, and instead, under its authority in § 422.116(a)(1), it intends to require that MA organizations submit an attestation that it has as an adequate network that provides the required access and availability to dialysis services, including outpatient facilities. See 85 Fed Reg 33796 (June 2, 2020), at 33860. Many advocates fear that this change may result in network designs that discriminate against or discourage ESRD beneficiaries from enrolling in MA plans.
Individuals with ESRD and their advocates should be aware of cost-sharing imposed by MA plans for dialysis. On the one hand, §3202 of the Affordable Care Act (ACA) states that cost-sharing under MA plans cannot exceed the cost-sharing imposed under traditional Medicare for three specific services—chemotherapy administration, renal dialysis services, and skilled nursing care. Under Part B of Medicare, the coinsurance rate for dialysis is 20%. On the other hand, federal law contains strong anti-discrimination provisions, including a requirement that “[t]he Secretary shall not approve a plan of an organization if the Secretary determines that the design of the plan and its benefits are likely to substantially discourage enrollment by certain MA eligible individuals with the organization.” 42 U.S. Code § 1395w–22(b)(1). Further, federal regulations require CMS, in its review of approval of MA benefits and associated cost-sharing, to ensure that “MA organizations are not designing benefits to discriminate against beneficiaries, promote discrimination, discourage enrollment or encourage disenrollment, steer subsets of Medicare beneficiaries to particular MA plans, or inhibit access to services.” 42 CFR §422.100(f)(2). Despite these anti-discrimination provisions, CMS has already approved MA plan benefit packages that charge the full, allowable cost-sharing amount for dialysis. The Center for Medicare Advocacy is aware of some MA plans that have increased coinsurance it charged for dialysis from $0 in 2019 to 20% coinsurance in 2020.
Increased Maximum Out-of-Pocket Limit (MOOP)
Since 2011, local MA plans (and since 2012 regional PPOs) must establish a maximum out-of-pocket (MOOP) liability amount for enrollees for all Part A and B services to be set yearly by CMS. 42 C.F.R. §§ 422.100 and 422.101. MOOP amounts are increasing for the first time in 2021 due to adjustments made to account for enrollment of higher cost individuals with ESRD. In 2021, the mandatory MOOP (in-network) is $7,550 (up from $6,700 in 2020). Plans that use a lower, voluntary MOOP (in-network) of $3,450 (up from $3,400 in 2020) have greater flexibility in establishing cost-sharing amounts. For plans that cover out-of-network services, such as PPOs, the 2021 in-network and out-of-network combined MOOP is $11,300 (up from $10,000 in 2020).
- See CMS, “CY 2021 Part C Benefits Review and Evaluation Memorandum” (April 8, 2020) available at: https://mabenefitsmailbox.lmi.org/MABenefitsMailbox/Documents/2021%2FFinal%20CY%202021%20Part%20C%20Bid%20Review%20Memorandum_4-8-2020.pdf
DME Competitive Bidding – 2021
All Medicare Durable Medical Equipment, Prosthetics, Orthotics, & Supplies (DMEPOS) Competitive Bidding Program contracts expired on December 31, 2018. As of January 1, 2019, there is a temporary gap in the entire DMEPOS Competitive Bidding Program that CMS expects will last until December 31, 2020.
- See CMS’ website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/DMEPOSCompetitiveBid
Part D and Insulin Costs – 2021
In May 2020, CMS announced that over 1,750 standalone Part D prescription drug plans and Medicare Advantage plans with prescription drug coverage have applied to offer lower insulin costs through a programs called the Part D Senior Savings Model for the 2021 plan year. According to CMS, this means that participating enhanced Part D prescription drug plans will provide Medicare beneficiaries access to a broad set of insulins at a maximum $35 copay for a month’s supply, from the beginning of the year through the coverage gap.
- See, e.g., CMS Press Release “President Trump Announces Lower Out of Pocket Insulin Costs for Medicare’s Seniors” (May 26, 2020), available at: https://www.cms.gov/newsroom/press-releases/president-trump-announces-lower-out-pocket-insulin-costs-medicares-seniors.
- LITIGATION UPDATE
Affordable Care Act Case
California v. Texas is the lawsuit brought by several states and supported by the Trump administration that seeks to strike down the entire Affordable Care Act (ACA). In 2019, a divided panel of the Fifth Circuit ruled that the ACA’s individual mandate is now unconstitutional because Congress reduced the penalty for remaining without insurance to $0. Then, although it was clear that Congress did not intend to strike down the entire ACA when it eliminated the penalty (because, among other things, it left the rest of the law in place), the Fifth Circuit concluded that many of the ACA’s provisions may not be “severable” from the mandate and therefore must also be struck down. It ordered the same district court judge who had struck down the entire law to parse through all of the ACA’s provisions with a “finer-toothed comb” to determine which can survive. However, before the remand occurred, the Supreme Court granted review in early 2020.
This lawsuit threatens the entire ACA: protections for pre-existing conditions, the expansion of Medicaid, and, critically for older adults and people with disabilities, many provisions that improved Medicare. The ACA closed the donut hole in Part D, saving beneficiaries millions on prescription drugs. It eliminated out-of-pocket costs for preventive services, such as mammograms and diabetes screenings. It extended the solvency of the Part A Trust Fund for many years. Simply put, the ACA is woven into Medicare, including over 165 provisions that help beneficiaries and strengthen the program’s financial well-being. Striking down the ACA would have disastrous ramifications for Medicare beneficiaries and the U.S. health care system as a whole.
In May 2020 the Center joined AARP and Justice in Aging in submitting an amicus brief in support of California and the other states defending the law. The amicus brief highlights the ACA’s key protections for older adults and the devastating consequences that would ensue if the law is nullified. It was one of 40 amicus briefs that were filed in support of the ACA. On June 25, 2020, Texas and several other states as well as the Trump administration filed their opening briefs, asking the Court to strike down the entire ACA. Three amicus briefs were filed in support.
UPDATE: Oral argument at the Supreme Court has been set for November 10, 2020. Currently the Court has only eight members and predictions as to how the case will play out are difficult to make.
For more information, see these resources from the Kaiser Family Foundation:
- “Potential Impact of Texas v. U.S. Decision on Key Provisions of the Affordable Care Act” (Jan. 2020).
- “Explaining Texas v. U.S.: A Guide to the Case Challenging the ACA” (March 2020).
Center for Medicare Advocacy Cases
- Alexander v. Azar (formerly Bagnall v. Sebelius, Barrows v. Burwell), No. 3:11-cv-1703 (D. Conn.), No. 13-4179 (2d Cir.), No. 20-1642 (2d Cir.) (Beneficiary Appeals of Observation Status). In November 2011, the Center for Medicare Advocacy and Justice in Aging filed a proposed class action lawsuit on behalf of individuals who have been denied Medicare Part A coverage of hospital and nursing home stays because their care in the hospital was considered “outpatient observation” rather than an inpatient admission. When hospital patients are placed on observation status, they are labeled “outpatients,” even though they are often on a regular hospital floor for many days, receiving the same care as inpatients. Because patients must be hospitalized as inpatients for three consecutive days to receive Medicare Part A coverage of post-hospital nursing home care, people on observation status do not have access to nursing home coverage. They must either privately pay the high cost of nursing care or forgo that skilled care. The number of people placed on observation status has greatly increased in recent years, as CMS has strictly enforced its definition of which services hospitals should bill as inpatient/Part A and which services they should bill as observation/Part B. However, CMS has not allowed beneficiaries to appeal the issue of whether their hospitalizations should be classified as observation or as inpatient for Medicare coverage purposes.
On September 23, 2013, a federal judge in Connecticut granted the government’s motion to dismiss the lawsuit. Plaintiffs appealed, but limited the appeal to the issue of the right to an effective notice and review procedure for beneficiaries placed on observation status. On January 22, 2015, the U.S. Court of Appeals for the Second Circuit decided that Medicare patients who are placed on observation status in hospitals may have an interest, protected by the Constitution, in challenging that classification. The panel held that the district court erred when it dismissed the plaintiffs’ due process claims, and it sent the case back to that court for further proceedings. Barrows v. Burwell, 777 F.3d 106 (2d Cir. 2015).
The parties completed discovery on the issue ordered by the Second Circuit: whether plaintiffs have a “protected property interest” in Part A coverage of their hospital stays, which depends on whether CMS has “meaningfully channeled” discretion on the question of patient status determinations. If the Secretary has established criteria for inpatient hospitalization, plaintiffs have an interest that is protected by the Due Process Clause and thus they may be entitled to notice and an opportunity to appeal their placement on observation. Plaintiffs received voluminous documentation from the government and conducted depositions of witnesses from the Department of Health and Human Services, Medicare contractors, and some of the hospitals that treated the named plaintiffs. The law firm of Wilson Sonsini Goodrich & Rosati, which has helped the Center in previous litigation, joined as representatives of the plaintiffs during this phase and has provide extraordinary and invaluable pro bono assistance.
After briefing and a hearing on the protected property interest issue and defendant’s supplemental motion to dismiss, the court issued a decision on February 8, 2017, denying both parties’ motions for summary judgment and largely denying the government’s motion to dismiss. The court found that all named plaintiffs have standing and none of their claims was moot, even though some have passed away and some have resolved their underlying individual claims. It decided that factual disputes precluded summary judgment on the property interest question. As for the motion to dismiss, the court found that plaintiffs had plausibly alleged the other two aspects of a due process claim: state action (in the form of pressure on providers by CMS) and inadequacy of existing procedures (it is undisputed that there is currently no appeal method for patients placed on observation status). The court found that plaintiffs’ claim for expedited notice is now moot due to the new requirements being implemented under the NOTICE Act (“MOON” notice).
Plaintiffs then filed a renewed motion for class certification, and on July 31, 2017, the court issued a decision certifying a nationwide class of Medicare beneficiaries who have received “observation services” in a hospital since January 1, 2009. A second round of discovery closed on June 15, 2018, with both parties having conducted numerous depositions and exchanging documents. The government filed for summary judgment for a second time on July 30, 2018, this time on the “what process is due” element of plaintiffs’ claim. The government focused on the three factors from Mathews v. Eldridge, 424 U.S. 319 (1976), which determine what procedural safeguards are due – with a particular focus on the risk of erroneous deprivation of the private interest at stake under the current procedures used (notably, there are currently no procedures for beneficiaries to appeal their hospital status) The government also filed a motion to decertify the class on August 24, 2018.
After a hearing and additional dispositive motions filed by the government, the court
issued a ruling denying the government’s motion for summary judgment, motion to decertify the class, and motion to dismiss on March 27, 2019. Alexander v. Azar, 370 F. Supp. 3d 302 (D. Conn. 2019). The judge concluded that evidence submitted by the plaintiffs could reasonably establish that physician decisions about whether to classify beneficiaries as inpatients are “meaningfully constrained” by criteria set by Medicare, including the Two-Midnight Rule since it came into effect in 2013, and class members may therefore possess a property interest in the inpatient Medicare coverage they seek. It also found that a trial was necessary to balance the evidence submitted about the three Mathews v. Eldridge factors. The court declined to dismiss the case, finding that the plaintiffs continue to have standing and that their claims are not moot. The court also did not take the drastic step of decertifying the nationwide class, but did modify the class definition to target individuals who, in the court’s view, are more certain to experience harm from the observation designation.
A bench trial was held from August 12 – 20, 2019. The plaintiffs presented several witness who were affected by observation status (two beneficiaries, a family member of a named plaintiff, a doctor), an expert witness, and also several witnesses from the government. The government also examined several witnesses from CMS as well as their own expert. The court then set a post-trial briefing schedule and issued an order containing five questions it requested the parties to address in their post-trial briefing. Post-trial briefing was complete as of November 26, 2019. The parties each submitted proposed findings of fact and conclusions of law, as well as responses to the court’s questions and to the other party’s submission. In January 2020, the court requested additional briefing. It asked whether it should find a property interest in Medicare Part A coverage for the periods both before and after the Two-Midnight Rule went into effect, whether that interest should be found for patients who are admitted as inpatients but later switched to observation, and how a successful appeal should affect class members’ eligibility for SNF care. Plaintiffs indicated why the court should find an interest in Part A coverage and should not limit that finding to beneficiaries who are switched from inpatient to observation.
In March 2020, the court issued a decision. Alexander v. Azar, — F. Supp. 3d –, 2020 WL 1430089 (D. Conn. Mar. 24, 2020). It held that the Secretary of Health and Human Services is violating the Fifth Amendment Due Process Clause by not allowing certain patients to appeal their placement on observation status. Thus, as matter of constitutional due process, patients who are admitted as inpatients by a physician, but whose status is changed to observation by their hospital, have the right to appeal to Medicare and argue for coverage as hospital inpatients. In making this ruling, the court held that there is a protected property interest in Medicare Part A coverage, meaning that an individual cannot be deprived of that coverage without procedural safeguards. The court did not, however, find a due process violation for patients whose doctors never order inpatient status, or whose status is switched only from observation to inpatient. It drew a distinction between the actions of doctors, and the actions of hospital utilization review staff. It decided that doctors’ decisions to admit patients as inpatients are not attributable to the government and thus not “state action,” a required component of a due process claim. But it held that then when a hospital’s utilization review staff finds that patient should be in observation status rather than an inpatient, that is due to Medicare’s billing rules and therefore does constitute state action.
The court modified the class definition accordingly. It is now:
All Medicare beneficiaries who, on or after January 1, 2009: (1) have been or will
have been formally admitted as a hospital inpatient, (2) have been or will have
been subsequently reclassified as an outpatient receiving “observation services”;
(3) have received or will have received an initial determination or Medicare
Outpatient Observation Notice (MOON) indicating that the observation services
are not covered under Medicare Part A; and (4) either (a) were not enrolled in Part
B coverage at the time of their hospitalization; or (b) stayed at the hospital for
three or more consecutive days but were designated as inpatients for fewer than
three days, unless more than 30 days has passed after the hospital stay without the
beneficiary’s having been admitted to a skilled nursing facility. Medicare
beneficiaries who meet the requirements of the foregoing sentence but who
pursued an administrative appeal and received a final decision of the Secretary
before September 4, 2011, are excluded from this definition.
The court ordered that the agency establish appeals process for class members, under which they can argue that their inpatient admission satisfied the relevant criteria for Part A coverage—for example, that the medical record supported a reasonable expectation of a medically necessary two-midnight stay at the time of the physician’s inpatient order. Patients will be able to pursue these appeals in an expedited manner while still hospitalized. The court also ordered the agency to provide notice of these procedural rights.
In May 2020, the government appealed the district court’s trial decision to the Second Circuit. In the meantime, the government must still implement the court’s order, as it has not been stayed, and plaintiffs’ counsel is trying to determine an approximate timeline for when an appeals process for beneficiaries will be established.
UPDATE: The government’s opening appellate brief is due to be filed October 27, 2020.
For answers to frequently asked questions from people who think they may be class members, please see the Center’s website here.
- McKee v. Azar, No. 2:19-cv-114-cr (D. Vt.) (coverage of home health services). On July 2, 2019, Vermont Legal Aid and the Center for Medicare Advocacy filed a lawsuit in federal court in Vermont, on behalf of a Medicare beneficiary whose was denied coverage of home health services. The beneficiary required skilled nursing visits to assess and treat her multiple serious medical conditions. The case challenges the Medicare agency’s failure to follow applicable law, including the standard clarified in the Jimmo v. Sebelius settlement, which requires the determination of whether individuals are eligible for Medicare coverage to be made on the basis of beneficiaries’ need for skilled care, not on their potential for improvement. This determination should be based on each beneficiary’s unique condition and individual needs. In this case, the plaintiff challenges the Secretary’s conclusion that her “stable” condition precludes a determination that she required skilled care and qualified for Medicare coverage of home health services. In addition, she challenges the agency’s failure to afford appropriate weight to the opinion of her treating physician about her need for skilled care.
Plaintiff filed a motion requesting reversal of the coverage decision on November 4, 2019. She argued that the coverage decision violated the standard clarified by the Jimmo settlement, and that she was eligible for home health coverage based on skilled observation and assessment as well as patient education services.
Starting December 2019 the government filed several requests to extend the deadline for its response to the plaintiff’s motion, based on the fact that the parties were seeking to resolve the matter.
UPDATE: In July 2020 the case was settled with full coverage for the beneficiary. Medicare has since paid Ms. McKee’s home health claim. Advocates should continue to remain alert for inappropriate denials of coverage based on lack of improvement or “stability” – particularly for people with chronic conditions.
- Dobson v. Azar, No. 4:18-cv-10038-JLK (S.D. Fla.), 20-11996 (11th Cir.) (Part D Off-Label Drug). On April 6, 2018, the Center for Medicare Advocacy and Florida Health Justice Project filed a lawsuit in the United States District Court for the Southern District of Florida on behalf of a 49-year-old Medicare beneficiary seeking Part D coverage for the “off-label” (non-FDA-approved) use of a critically needed medication. The plaintiff is disabled from a traumatic workplace injury that damaged his spinal cord. As a result of severe pain and multiple surgeries, he suffers daily from debilitating nausea and vomiting. After numerous medications failed to provide relief, his doctor prescribed Dronabinol, which significantly relieved his nausea and vomiting and allowed him to resume many activities of a normal life.
When Mr. Dobson became eligible for Medicare Part D, his plan denied coverage because his particular use of Dronabinol is not FDA-approved. However, the Part D plan should cover the medication because Mr. Dobson’s use of the drug is supported by one of the “compendia” (DRUGDEX) of medically-accepted indications listed in the Medicare law. Medicare looks to the compendia for acceptable off-label uses of medications, and the symptoms of nausea and vomiting are listed in an entry for Dronabinol. The plaintiff’s position is strongly supported by a recent federal decision granting Part D coverage of the same medication for a beneficiary with very similar symptoms (Tangney v. Burwell, 186 F. Supp. 3d 45 (D. Mass. 2016)). In spite of this, Mr. Dobson was denied coverage at each level of administrative review. In appealing his claim to federal court, Mr. Dobson contests the agency’s use of an inappropriately restrictive reading of the law to claim that coverage cannot be granted.
Briefing on cross-motions for summary judgment was complete as of December 3, 2018. Oral argument on the parties’ cross motions for summary judgment was held on September 25, 2019 in Miami in front of a magistrate judge.
The judge issued a decision on March 31, 2020, finding that Mr. Dobson’s medication cannot be covered by Medicare Part D. She credited the government’s argument that Mr. Dobson’s use was not a “medically accepted indication,” “supported by citation” in DRUGDEX. This was because he does not have the identical diagnosis as the patient in the study contained within the DRUGDEX citation for disease-related, treatment-refractory nausea and vomiting. The judge rejected the reasoning of the Tangney court. In May 2020 the plaintiff appealed the district court’s decision to the 11th Circuit.
UPDATE: Mr. Dobson’s opening appellate brief was filed on September 8, 2020. He argued that the plain meaning of the Medicare statute mandates coverage of his medication because his use is “supported by” the Drugdex citation in question. He also argued that even if the statute was deemed to be ambiguous, the court should not have afforded “Skidmore deference” to Medicare’s narrow interpretation of the law. The American Medical Association and Greater Boston Legal Services (which litigated the Tangney case) also filed amicus briefs in support of Mr. Dobson.
- Jimmo v. Sebelius, No. 5:11-cv-17 (D. Vt.) (Improvement Standard). The settlement in Jimmo was approved on January 24, 2013. CMS issued revisions to its Medicare Benefit Policy Manual to clarify that Medicare coverage is available for skilled maintenance services in the home health, nursing home and outpatient settings. CMS also implemented a nationwide Educational Campaign for all who make Medicare determinations to ensure that beneficiaries with chronic conditions are not denied coverage for critical services because their underlying conditions will not improve. Pursuant to the settlement, counsel for the parties met twice a year to discuss problems with implementation and possible solutions.
After three years of urging CMS to fulfill its obligation to end continued application of the “Improvement Standard,” the Center and Vermont Legal Aid filed a Motion for Resolution of Non-Compliance with the settlement agreement. The court announced its decision on the Motion on August 18, 2016. The Order required CMS to remedy the inadequate Educational Campaign that was a cornerstone of the original Settlement Agreement. As the judge stated, “Plaintiffs bargained for the accurate provision of information regarding the maintenance coverage standard and their rights under the Settlement Agreement would be meaningless without it.”
On February 2, 2017, the court released a decision ordering CMS to carry out a Corrective Action Plan to remedy noncompliance with the Settlement. Jimmo v. Burwell, 2017 WL 462512 (D. Vt. Feb. 1, 2019) The plan includes a new webpage by CMS dedicated to the Jimmo settlement with frequently asked questions and a statement (which the court largely adopted from plaintiffs’ suggested language) that affirmatively disavows the Improvement Standard; new training for Medicare contractors making coverage decisions; and a new National Call for Medicare contractors and adjudicators to correct erroneous statements that had been made on a previous call. On February 16, 2017, the court approved the final wording of the statement to be used by CMS to affirmatively disavow the use of an Improvement Standard. Importantly, the statement notes that the “Jimmo Settlement may reflect a change in practice for those providers, adjudicators, and contractors who may have erroneously believed that the Medicare program covers nursing and therapy services under these benefits only when a beneficiary is expected to improve.”
In late August 2017 the government published the new Jimmo-webpage on the CMS website to comply with the Corrective Action Plan. The webpage includes court-approved affirmative disavowal of the Improvement Standard in a blue box titled “Important Message About the Jimmo Settlement.” The webpage also contains links to Jimmo-related documents, such as the transmittals of the revised Manual provisions, and a new set of Frequently Asked Questions. The imprimatur of CMS on these materials will help beneficiaries and their advocate who are arguing against inappropriate coverage denials or service terminations.
The court case has now concluded, but class counsel continues to work on ensuring that access to skilled maintenance nursing and therapy for older adults and people with disabilities is not inappropriately denied or terminated because their conditions are “chronic,” “not improving,” “plateaued,” or “stable.”
For more information on the Improvement Standard, visit the Center’s website here.