AMERICAN ASSOCIATION OF HEALTHCARE ADMINISTRATIVE MANAGEMENT CENTRAL OHIO PATIENT ACCOUNT MANAGERS Annual Fall Conferen

1. AMERICAN ASSOCIATION OF HEALTHCARE ADMINISTRATIVE MANAGEMENT CENTRAL OHIO PATIENT ACCOUNT MANAGERS Annual Fall Conference OHA UPDATE Charles Cataline Senior Director, Health Policy Ohio Hospital Association charlesc@ohanet.org AAHAM / COPAM Annual Fall Conference

2. Agenda • Ohio Hospital Franchise Tax Update • CMS Medicaid DSH Audit & Reporting • Medicare FFY 2011 IHPPS & OPPS • Medicare RAC & MAC Updates • BWC IHPPS & OPPS • Etc., etc… AAHAM / COPAM Annual Fall Conference

3. SFY 2010-11 BudgetHospital Franchise Tax Program – As Enacted Tax on Hospitals: $728 M Federal Matching Funds: $1.76 B Total State Revenue: $2.49 B Return to Hospitals: 5% Medicaid Rate Update: $307.7 M Supplemental Payments (UPL): $267.2 M Total Return to Hospitals: $574.9 M Hospitals Out $153 Million State Retains Over $1.9 Billion in Medicaid Revenue 3 AAHAM / COPAM Annual Fall Conference

4. Ohio Hospital Franchise Tax: OHA Advocacy Initiatives Summer 2010 • Fairness & equity • Return $150 million to hospitals by: • Reducing tax rate from 1.61% to 1.5% • Removing uncompensated care from tax base • Removing Medicare costs from the tax base • Administration includes hospital proposal in initial 2012-13 budget submission • Legislature passes budget consistent with hospital proposal and OHA Board recommendations (including $150 million and equity if not successful short-term) AAHAM / COPAM Annual Fall Conference

5. Latest Response from Office of the Governor • Returns $150 Million to Hospitals in Aggregate for 2011 Program • Reduces Assessment • Adds Tiered Assessment • Removes Medicare Costs From Base AAHAM / COPAM Annual Fall Conference

6. Ohio’s 2012-2013 Budget Challenges • Anticipated $8.2 to $9.1 Billion General Revenue Fund Deficit • Ongoing Uncertainty About Enhanced Federal Medicaid Matching Payments (eFMAP) • Recent, Rapid Growth in Medicaid Spending • One-time Funding Sources are Exhausted AAHAM / COPAM Annual Fall Conference

7. Medicaid Strategies: Short-Term BalanceOther State Responses 2010 2011 Number of States AAHAM / COPAM Annual Fall Conference Health Management Associates

8. HUT 2 Task Force Recommendations to OHA Board Any future assessment program must: • Be fair & equitable • Get hospital dollar back in aggregate • Have hospital community involved in design and oversight of program • Incorporate “safeguard” mechanisms to protect hospitals, e.g. a sunset • Ensure hospitals avoid harmful Medicaid cuts • Ensure managed care plans’ cooperation • Be minimized by using other revenue sources • Ensure HCAP is preserved for hospitals AAHAM / COPAM Annual Fall Conference

9. CMS Medicaid DSH Audit & Reporting • Standardized Policies, Definitions & Formats • Includes Definitions & Guidelines on Allowance of Uncompensated Care Cost • Based in MMA, Final Rule in Dec. 19, 2008, FR • Retro to SFY2006, 1st Reports due Fall 2010 • States’ FFP at Risk • Independent Audits of State DSH Programs Required • Based on Cost Reports & Audited Statements / Records • Could Involve Hospital-Specific Audits; Double-Check Accuracy of HCAP Policies, Logs and Cost Report Data • Ohio RFP for Independent Auditor Out Soon • Federal Law in the Works to Block Parts of Process AAHAM / COPAM Annual Fall Conference

10. Medicare FFY 2011 IHPPS Final Rule • Aug. 16 FR, Includes PPACA Provisions • Negative Update to Standardized Amount Is This the First Year of Many Like This to Come? • 2.6% MB minus 2.9% for “Coding Creep” & .25% for PPACA • Outlier Threshold Decreased to $23,075 • No Significant Changes to Wage Index • This Fight is not Over! • Significant Increase in Quality Reporting Elements • No New Hospital-Acquired Conditions • “Clarification” to CAH Tax Policy Will Have Big Repercussions • DRG Window Re-Re-Clarified AAHAM / COPAM Annual Fall Conference

11. Medicare IHPPS 2011 Ohio Estimated Payments AAHAM / COPAM Annual Fall Conference

12. Medicare CY 2011 OPPS • 2.4% MB Update with .25% PPACA Cut; APCs Frozen • Additional Quality Reporting Measures (30 by 2014) with Mandated 2.0% cut to Non-reporters & Data-Validation to 800 Randomly Selected Hospitals • Dual(ing?) Supervision Requirements for “Nonsurgical Extended-Duration Therapeutic Services” • Lower Fixed-Dollar Outlier Threshold • Fewer Inpatient-Only Procedures • Many Preventative Services Have Reduced or Waived Co-payments AAHAM / COPAM Annual Fall Conference

13. Medicare Administrative Contractor • J-15 (OH & KY) MAC Award to CIGNA Immediately Protested by Highmark & NGS • No Decision due Until Nov. 3 at the Earliest • If CIGNA or Highmark (or Someone Else) Wins, Expect Six-month Transition • NGS States it Will be Processing Bills Through 2011 Regardless • “800 Lb Gorilla” is CMS Plan to Re-bid and Expand MAC Jurisdictions in 2015 AAHAM / COPAM Annual Fall Conference

14. Medicare Recovery Audit Contractor OHA RAC Summit Scheduled November 3 CGI Still Slowly Rolling Out; Complex Into 3rd & 4th Cycle and Medical Necessity Reviews to Start Soon • Expect Increased Volume as CGI Gains Experience • Get a Tracking System; Report Results to AHA RACTrac • PPACA Expands RAC to Medicaid (What about MIP?!) Several Areas of Concern Being Reported to OHA • Still Some Problems with Missing Demand Letters • Timing of Requests, Reviews, Responses, Discussion, Appeal, Recovery and Interest • Medicare Remittance Advice AR v. Actual Payment • Physician Signatures on Orders • Multiple Reviews on the Same Account • What About Secondary Payers and Patients?! AAHAM / COPAM Annual Fall Conference

15. Bureau of Workers’ Compensation • Outpatient Medicare-based PPS Effective 1/1/11; Testing Underway • Medicare v. BWC PPS Chart Available at http://www.ohanet.org/Issue/BWC • (See Announcement Section) • BWC Won’t Adopt Most Medicare/PPACA Programs and Cuts • BWC Audit RFP Out AAHAM / COPAM Annual Fall Conference

16. Other Updates • Watch for PPACA-Based Requirements on for Financial Assistance, Collection & Charge Limits • Medicare Provider Enrollment and CMS 855 Enforcement • Medicare Zero-Bill Requirement Expansion • Medicare Billing Timeliness Edits • Medicaid Information Technology System • Medicaid National Drug Coding • 2010 Federal Poverty Limit Guidelines Frozen • Watch for Medicare ESRD PPS In 2011 AAHAM / COPAM Annual Fall Conference