By Remy Kerr, MPH, AMRPA Health Policy and Research Manager
On June 15, the Medicare Payment Advisory Commission (MedPAC) released its June 2021 Report to Congress. Each year, MedPAC releases an annual March and June report focused on payment policy issues as well as health care delivery system and broader issues impacting the Medicare program. In this year’s June report, there was limited coverage of post-acute care-related policy, and no inpatient rehabilitation hospital/unit (IRF)-specific recommendations. The June report also did not include a chapter on the COVID-19 public health emergency (PHE) or any substantive update on MedPAC’s unified post-acute care payment prototype work.
Consistent with sessions throughout the 2020-2021 meeting cycle, MedPAC issued formal recommendations on a number of topics in the June 2021 Report to Congress. Of interest to AMRPA members, MedPAC recommended that the Centers for Medicare and Medicaid Services’ (CMS) Center for Medicare and Medicaid Innovation (CMMI) shift toward a “smaller, more harmonized” collection of alternative payment models (APMs) and replace the skilled nursing facility (SNF) value-based purchasing (VBP) program with a value incentive program (VIP). MedPAC also provided a Congressionally-requested interim report on rural Medicare beneficiaries access to care and the impact of rural hospital closures. A summary of these chapters follows:
CMMI/APMs: In the APM chapter, MedPAC provided an overview of CMMI’s portfolio of APMs, highlighting the large number of APMs currently in existence and the potential that the models may be inhibiting the benefits of one another. The report also noted the limited savings many of the models have had for the Medicare program. According to MedPAC, by implementing models that are designed to work together, CMS will be better able to evaluate a model’s effectiveness and decrease the risk of model incentives conflicting with one another. To do this, MedPAC provided three approaches – 1) focusing on a single population-based model with varying tracks; 2) utilize a geographic approach for models; or 3) utilize waivers that allow for state-specific versions of CMMI APMs. MedPAC asserts that “harmonizing” models and decreasing their complexity could result in better care coordination and care quality, and create more “predictable” financial incentives and decrease administrative burden for providers.
SNF Value Based Purchasing Program: As part of the Protecting Access to Medicare Act of 2014, MedPAC is tasked with reviewing the SNF VBP and providing recommendations for its improvement. In response to this mandate, MedPAC included a chapter on the VBP with two recommendations to improve the program. According to MedPAC’s analysis, SNFs with a large number of dual-eligible beneficiaries or those with more medically-complex patients were more likely to be penalized in the current VBP. In addition, the analysis found that both rewards and penalties were small for almost seventy-five percent of providers. In response to the analysis, MedPAC recommends that the SNF VBP be replaced with a VIP “as soon as possible.” MedPAC recommends that the VIP: 1) score a small set of performance measures; 2) incorporates strategies to ensure reliable measure results; 3) establishes a system for distributing rewards that minimizes cliff effects; 4) accounts for differences in patient social risk factors using a peer-grouping mechanism; and 5) completely distributes a provider-funded pool of dollars. MedPAC also included a second recommendation that the HHS Secretary finalize development of and begin to report patient experience measures for SNFs.
Rural Access: In the rural Medicare beneficiaries’ access to care chapter, MedPAC provided an interim overview and update to its June 2012 report to Congress. A final report on the topic is expected in June 2022. In addition to its request for an update to the June 2012 report, the House Ways and Means Committee also requested information on dual-eligible beneficiaries, beneficiaries with multiple chronic conditions, and beneficiaries who live in a medically underserved area, as well as analysis on any factors that may have impacted rural areas since issuance of the last report. According to MedPAC’s analysis using its own Medicare beneficiary survey and CMS’ Medicare Current Beneficiary Survey, the commission found that rural and urban beneficiaries generally have similar access to care and utilization rates, with some slight differences. MedPAC noted in its report that geographic variation in terms of utilization was much more significant than utilization between urban and rural beneficiaries within the same region. In terms of evaluation and management (E&M) utilization for clinician services, rural beneficiaries had fewer encounters which MedPAC primarily attributed to fewer specialist visits. For hospital inpatient services, both rural and urban beneficiaries had similar utilization patterns; however, for hospital outpatient services, rural beneficiaries had increased utilization. MedPAC also noted that hospital outpatient utilization was “very large” by regional variation as well. Lastly, for home health (HH) and SNF utilization, rural utilization was found to be similar or higher compared to urban beneficiaries. MedPAC highlighted that HH utilization was particularly variable by geographic region, with some regions having a six to eightfold difference.
Within the chapter on rural beneficiaries’ access to care, MedPAC also provided an analysis on rural hospital closures. The commission highlighted its 2018 recommendation that Medicare allow isolated, freestanding emergency departments to bill Medicare and provide them with annual payments to assist with fixed costs, and Congress’ recently implemented program to create “rural emergency hospitals.” This new designation of hospital will begin on January 1, 2023 and provide 24/7 emergency level care, along with outpatient, nursing facility and ambulance services, but no inpatient services. MedPAC noted in the report that the Commission’s future analyses will need to take this and any other policy changes into account as it prepares its final report for Congress next year.
MedPAC’s next public meeting is scheduled for September 2021. If you have any questions related to MedPAC, please contact Remy Kerr, AMRPA Health Policy and Research Manager.
 The current SNF VBP only utilizes a single measure – hospital readmissions – to determine quality of care.
 MedPAC did not include an analysis on IRF or long-term care hospital (LTCH) utilization.