The Affordable Care Act at age five: a look back and a look ahead

Somewhere near their first birthdays, children learn to walk. At three years of age, they might start pedaling a tricycle, and at age five, they are poised to enter kindergarten. March 23, 2015, marks the fifth anniversary of the enactment of President Obama’s signature health reform law, the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148). Has the ACA, at five years of age, made the same amount of progress as a child?

Critics argue that the ACA has failed, but proponents say that it is moving closer to achieving its goal of quality, affordable health care for all Americans. As a law that seeks to expand health insurance coverage for Americans, improve the functioning of health insurance markets, and control the efficiency and quality of health care, the ACA has “had a major positive impact, and one that will continue to bring efficiencies over time,” said Keith Fontenot, the managing director of government relations and public policy at Hooper, Lundy & Bookman, P.C.

Regardless of whether it has met its milestones, it is clear that the ACA has already made an impact. It has had significant effects on the uninsured rate, the affordability of coverage via the provision of subsidies, the use of preventive services, and the actions of large employers and insurers. Many ACA provisions have gone into effect over the last five years; however, due to design or delay, a number of significant reforms have yet to be implemented or fully realized.

This White Paper looks at the ACA’s impact on Medicare and Medicaid issues and its impact on the private insurance market. It also looks at major ACA changes facing health care providers and employers in the coming months.

Read further, “The Affordable Care Act at age five: a look back and a look ahead.”

Kusserow on Compliance: OIG Advisory Opinion 15-01, advertising and providing baby care items in connection with services

On February 2, 2015, the HHS Office of Inspector General (OIG) posted an a­­­dvisory opinion in response to an inquiry as to whether certain advertising and incentive practices were in violation of the federal Anti-Kickback Statute (AKS). The requestor is a state-licensed provider that offers care coordination and intervention services to pregnant women and infant children under a state Maternal Infant Health Program (Program). The OIG disclosed that it has an exception regarding an entity’s practice of advertising and providing free diapers and play yards in connection with the services it provides under a state’s home visiting program for at-risk mothers and infants.

According to the state Program Operations Guide (Guide), all pregnant women and infant children who are Medicaid beneficiaries are eligible. The Guide requires program providers, such as the entity, to conduct marketing and outreach activities to the target population in the areas they serve and suggests the provision of incentives, such as free diapers, as an outreach activity. Eligible beneficiaries may receive one free pack of diapers during their initial consultation. In order to receive the free diapers, the beneficiaries are not required to enroll in the program or designate the entity as their program services provider. However, beneficiaries who enroll in the Program thereafter and designate the entity as their provider may receive additional free packs of diapers, limited to one free pack per billable visit. The aggregate value of diapers the entity provides to any individual beneficiary is less than $50. To receive a free play yard under the Program, a beneficiary must enroll in the Program, select the entity as her program services provider, and complete ten visits. The play yards have a value of approximately $50.

The OIG opined that although the diapers and play yards are intended to induce Medicaid beneficiaries to enroll in the Program and to select the entity as the provider, the arrangement does not subject the entity to sanctions of civil monetary penalties (CMP) because:

  • the diapers are nominal in value;
  • both the diapers and the play yards satisfy the Preventive Care Exception requirements that excludes incentives given to individuals for the delivery of preventive care from the definition of remuneration for purposes of CMP (42 C.F.R. section 1003.101);
  • the diapers are not prohibited by CMP because they fall within the per-item and aggregate thresholds set by the OIG for incentives of nominal value;
  • neither the diapers, nor the play yard, nor the combination of the two is disproportionately large in relationship to the value of the Program services (noting that a beneficiary has to complete ten visits to receive the play yard); and
  • because the Program services are not tied to the provision of the medical care that Program beneficiaries receive, neither the diapers nor the play yards constitute remuneration under the CMP.

Ultimately, the OIG stated that the arrangement does not constitute grounds for the imposition of CMPs under the AKS. The OIG further clarified that although the arrangement could potentially generate prohibited remuneration under the AKS if the requisite intent to induce or reward referrals of federal health care program business were present, the OIG would not impose administrative sanctions on the entity in connection with the arrangement. The OIG reminds readers that the advisory opinion is limited in scope to the specific arrangement described in the advisory opinion and has no applicability to other arrangements, even those which appear similar in nature or scope.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2015 Strategic Management Services, LLC. Published with permission.


Senators want to extend and expand Medicaid payment rate increase

A new Senate bill would extend reimbursement parity for doctors who treat Medicare and Medicaid patients, and would also apply to nurse practitioners and physician assistants who treat women and children. The Ensuring Access to Primary Care for Women & Children Act (S.B. 737) is sponsored by Senator Sherrod Brown (D-Ohio) and Senator Patty Murray (D-Wash). The original provision was part of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), but was allowed to expire on December 31, 2014.

Medicaid provider shortage

In 2012, a report indicated that more than a third of physicians refused to take Medicaid patients because of the low reimbursement rates. Provider fees were temporarily hiked to match the reimbursements received for treating patients enrolled in Medicare. The expiration of the provision resulted in a substantial pay cut for primary care providers who were treating Medicaid patients. The bill’s sponsors are concerned that Medicaid enrollees, especially women and children, will be unable to find care in a timely manner if more providers refuse to see them. Following the expansion of Medicaid in many states under the ACA, almost 70 million Americans were enrolled as of December 2014.


The president requested a one-year extension in the 2014 budget proposal, but nothing has come from it. The senators feel that offering higher rates to providers will cut down emergency room visits for needs that could be easily addressed by primary care providers, which has been a serious problem for Medicaid programs. Research supports the idea that higher reimbursement rates increase appointment availability for enrollees. This extension does not come cheap, as CMS estimates come in as high as $11 billion for Medicaid.


This bill would go farther than the original ACA provisions, as ob-gyns, plus nurse practitioners and physician assistants who treat women and children, would also be included. This would impact a significant portion of Medicaid enrollees. In 2009, the majority of adult women enrolled in the program were considered of reproductive age. Women are more likely to regularly see an ob-gyn than any other type of doctor. Additionally, more people are seeking care from nurse practitioners and physician assistants as primary care providers become increasingly overloaded.

Highlight on Tennessee: Governor proposes 10% cut to mental health case management

Mental health funding through Tennessee’s Medicaid program, TennCare, would be cut under budget changes proposed by Governor Bill Haslam (R). These cuts would reduce funding for Level 2 Case Management Services by 10 percent.

Level 2 Case Management

Level 2 Case Management Services fund outpatient care for Tennessee’s mentally ill patients. Case managers working under Level 2 aid mental health patients in their daily lives by monitoring medication intake, assisting in employment searches, and coordinating everyday activities, such as buying groceries.

“It’s about quality of life,” said Frontier Health CEO and President Dr. Teresa Kidd. “Mental illness is one of those diseases . . . where you have periods of stability, you’re prone to relapse, and you may do well again. But helping people access the systems that they need to really be the most they can be is what case management does.” Frontier provided data showing that in 2014, approximately 2,200 people in Tennessee used Level 2 Case Management to cope with mental illness, and 92 percent of these people meet the state’s definition for serious, persistent mental illness.

Effect of proposed changes

The budget cuts proposed by Governor Haslam would not eliminate Level 2 case management completely, but it would limit case management services to 90 days after being hospitalized for mental illness, rather than allowing years of services if necessary. Kidd said that, not only is 90 days insufficient for these types of services, hospitalization is too costly a treatment method for how ineffective it can be.

“[I]t’s terrible for the person to have to wait until they get to crisis,” Kidd said. “The case management movement has been one of the most successful things that we have used in this state to actually decrease hospitalization.”

Others are concerned that the drop in the number of case managers will result in fewer patients receiving any necessary treatment for their mental illnesses, increasing interactions between law enforcement and the mentally ill.