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Summary of the impact of the American Taxpayer Relief Act of 2012 on the dialysis community

January 03, 2013
KEYWORDS bundle / fiscal cliff
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Here are some of the main points of the legislation that impact Medicare and the ESRD Program, according to an analysis provided by Prime Policy Group.


- SGR fix: The new law includes a one-year fix to the Medicare Sustainable Growth Rate formula that governs Medicare payments to physicians. Physicians would have faced a 27% cut in their pay on Jan. 1.


- Rebasing of dialysis bundled payment: The Secretary of HHS is directed to rebase the ESRD prospective payment system using drug utilization data from 2012. The Secretary is further instructed to take into account the most recent data on Average Sales Prices and other changes in prices for drugs and biologics. According to the Congressional Budget Office, this measure will achieve savings of $4.9 billion over the next 10 years. “It is important to note CMS is not bound to achieve that level of savings as the estimate is done for Congressional purposes only,” Prime Policy said.


- Delay in oral drug coverage: The bill also further delays inclusion of oral drugs in the PPS for another two years. Oral drugs will be included in the bundled payment in 2016.


- Case-mix adjustments: The Secretary is also instructed to review case-mix adjustments by Jan. 1, 2016 and make changes in payment based upon the review.
- GAO report: The Government Accountability Office is directed to produce a report by Dec. 31, 2015, about how the Secretary has addressed points raised in an earlier report about the Secretary's preparations to implement payment for oral drugs in the bundle.


- Dialysis transport fraud reduction: The issue of fraud in the transport of dialysis patients was addressed by reducing reimbursements for ambulance providers rather than by requiring or allowing clinics to provide transportation.


- Automatic cuts to Medicare delayed: The Budget Control Act of 2011 provided for automatic spending cuts to be made to Medicare and many other programs through the budget sequestration process starting on Jan. 2. Medicare payments were expected to be cut by $11 billion through this process. Those spending cuts have been delayed for two months to give Congress more time to review.

 

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