Local, State, Federal

The Bill Box: HHS Proposal Targets Electronic Transaction Standards
The Bill Box: House Bill Takes Aim at Self-Referral
Price Transparency Revisited

The Bill Box

HHS Proposal Targets Electronic Transaction Standards
During the summer, the Department of Health and Human Services (HHS) announced a long-awaited proposed regulation that would replace current ICD-9-CM code sets, which are used to report health care diagnoses and procedures, with expanded ICD-10 code sets. If passed, this change would take effect on October 1, 2011.

Furthermore, HHS also proposed the adoption of the updated X12 standard, Version 5010, and the National Council for Prescription Drug Programs standard, Version D.0, for electronic transactions. Version 5010 is essential to use of the ICD-10 codes, according to CMS.

“We are taking a giant step forward toward developing a health care system that focuses on quality and affordability through the implementation of health information technology,” said HHS Secretary Mike Leavitt.

Leavitt said conversion to ICD-10 is critical to the development of a nationwide electronic health information environment. The code sets will allow HHS to fully support quality reporting, pay for performance, and bio-surveillance, among other activities, he continued.

In 2000, under the Health Insurance Portability and Accountability Act of 1996, the ICD-9-CM code sets were adopted for use in public and private administrative transactions in reporting diagnoses and inpatient hospital procedures. Covered entities required to use the code sets included health plans, health care clearinghouses, and health care providers who transmit any electronic health information in connection with a transaction for which a standard has been adopted by HHS.

The ICD-9, which was developed nearly 30 years ago, is now seen as outdated because of its limited ability to accommodate new procedures and diagnoses. It contains only 17,000 codes, and it is predicted that it will start running out of available codes next year. On the other hand, ICD-10 code sets contain more than 155,000 codes and accommodate a variety of new diagnoses and procedures

House Bill Takes Aim at Self-Referral
In August, a US House representative introduced a bill that would require the disclosure of physicians’ financial interest in certain imaging services.

Rep Carolyn McCarthy (D-NY) introduced the Medicare Imaging Disclosure Sunshine Act of 2008 into the House on August 1. It serves as a companion bill to legislation that Sen Charles Grassley (R-Iowa) introduced last month into the Senate.

Seeking to ban self-referral, the bills would amend the Stark law to mandate that physicians disclose financial interests in certain imaging services provided through the in-office ancillary exception. Physicians would also be responsible for providing patients with a list of alternative imaging providers in the area. This requirement would become effective in 2010.

McCarthy is also the original cosponsor of the Access to Medicare Imaging Act of 2007, which calls for a 2-year moratorium on the imaging cuts in the Deficit Reduction Act of 2005.

Price Transparency Revisited

Last October, a medical device transparency bill introduced in the Senate had many in the industry shifting in their seats. Currently being reviewed in committee, the Transparency in Medical Device Pricing Act, introduced by Sens Charles Grassley and Arlen Specter, would mandate the disclosure of average and median sales prices for implantable devices, such as pacemakers and stents, on a quarterly basis in order to be eligible for Medicare, Medicaid, or the State Children’s Health Insurance Program.

The presidential election in November has reintroduced the issue, this time directed at hospitals and health systems, with candidates from both parties calling for increased price transparency. The Bush administration has also supported price transparency, believing it would push consumers toward more cost-effective treatments.

A recent article in the Philadelphia Inquirer explored the topic, citing that patients pay varying prices for procedures depending on what their insurance companies have negotiated with the hospital. These companies, for the most part, do not disclose their rates and encourage hospitals to keep quiet, according to the paper. If Americans were able to find out what those negotiated rates are in advance of a procedure, they “might spend a few gazillion less dollars on health care,” the paper concludes.

“Despite the obvious complexity, hospitals, insurance companies, and federal and state governments are forging ahead with efforts to make price information more available,” the Inquirer continued.

CMS deputy administrator Herb Kuhn told Medical News Today that while price-transparency efforts haven’t ran smoothly, “the debate over whether this is worth doing is over. … We can’t let the perfect be the enemy of the good, and we know that the status quo is a far more potent enemy.”