IHA Daily Briefing: June 13

Thursday, June 13, 2019
CMS Edit Check for Outpatient Locations
IL Rep. Urges Review of Proposed Acquisition of WellCare
Survey Shows Importance of 340B Program


CMS Edit Check for Outpatient Locations
The Centers for Medicare & Medicaid Services (CMS) will soon (expected July 2019) activate an edit to check whether the address of a hospital outpatient off-campus provider-based department claim exactly matches the address the provider entered into the Medicare Provider, Enrollment, Chain and Ownership System (PECOS). CMS will also check if providers are including the modifier “PO” and “PN” on the claim, reflecting whether the off-campus department was grandfathered or non-grandfathered.

If the address does not exactly match, the claim will be returned to the provider and then need to be resubmitted with the exact address used in the PECOS system.  Hospitals are urged to check their claim addresses now in anticipation of this new edit.

Further information can be found in the MLN Matters Article SE19007.


IL Rep. Urges Review of Proposed Acquisition of WellCare
In a letter sent late last week to the Antitrust Division of the Department of Justice (DOJ), Rep. Raja Krishnamoorthi (IL-8) expressed concern about the affect the proposed acquisition of WellCare by Centene would have on competition in the Medicaid Managed Care and Medicare Advantage markets in Illinois and across the nation.

"Centene and WellCare are both large national players in the Medicaid Managed Care and Medicare Advantage markets. Both of these programs serve vulnerable populations, including low-income families, seniors, and individuals with disabilities, and both markets are characterized by high barriers to entry. As such, DOJ's scrutiny of the proposed acquisition is critically important," the letter read.

"If the proposed acquisition of WellCare by Centene were to proceed, the companies would collectively control about half of the Medicaid Market in Illinois. Following WellCare's Acquisition of Meridian in 2018, there are currently only four Medicaid Managed Care plans available statewide in Illinois. The number of Medicaid Managed Care plans available for Illinois residents to choose from would be further reduced to only three...

"Consolidation in the Medicare Advantage market is also troubling. Following WellCare's acquisition of Meridian, Centene's proposed acquisition of WellCare would result in three separate Illinois Medicare Advantage plans consolidating in to one in the span of less than a year."

Krishnamoorthi, who serves as the Chairman of the Oversight Subcommittee on Economic and Consumer Policy, said he has a duty to conduct oversight of policies affecting healthcare and consumer protection, and urged DOJ to consider the impact the proposed consolidation would have on consumers in Illinois and across the country. AHA also shared its concerns to DOJ about the proposed acquisition in a letter sent in April.


Survey Shows Importance of 340B Program
A 340B Health annual survey for 2018 showed that the 340B drug pricing program annual savings across its more than 1,300 member hospitals nationwide was $11.8 million. The survey showed that hospitals reported an average of $100,000-$200,000 in 340B compliance costs, with an average of two full-time workers managing the program.

Ninety-five percent of hospitals surveyed said they are using 340B savings to support uncompensated care. Ninety-three percent of rural hospitals surveyed reported that they are using the 340B savings to keep their facilities open and accessible to their rural communities.

Hospitals overwhelmingly reported that if there were cuts to the 340B program the care they provide to patients with low incomes and those living in rural communities would be impacted.  More than 70% of disproportionate share hospitals surveyed said they would have to reduce their offering of free and/or discounted drugs if there were cuts to the 340B program. Nearly 60% of rural hospitals said that cuts to the program would affect their ability to stay open.