The American Academy of Orthopaedic Surgeons (AAOS) issued a statement praising two initiatives in “Reforming America’s Healthcare System Through Choice and Competition,” a December 3, 2018 joint statement by three Trump Cabinet agencies of plans to upend parts of the Affordable Care Act (ACA) and push the President’s health care agenda.
Sent to the White House signed by Alex M. Azar, II, Secretary U.S. Department of Health and Human Services, Steven T. Mnuchin, Secretary, U.S. Department of the Treasury, and Alexander Acosta, Secretary, U.S. Department of Labor, the document proposes regulatory and legislative changes which would reverse or upend many provisions of the Affordable Care Act and other healthcare policies of the Obama era, while implementing and taking credit for a few.
AAOS endorsed provisions proposing legislation to repeal the ACA’s restrictions on physician-owned hospitals (POHs), which effectively created a moratorium on them; and for site-neutral payment policies between hospitals and other health care facilities, including ambulatory surgery centers.
“Lifting restrictions on physician-owned hospitals is a necessary step to improving quality of care, reducing costs, and giving patients access to facilities in their own communities. Additionally, positively realigning incentives through payment reform, such as site neutrality, will also empower patients to make their own health care decisions and increase price transparency,” said the December 6 statement from AAOS President David A. Halsey, M.D.
The Administration seems serious about promoting physician-owned hospitals.
The three agencies, citing selected studies, said of POHs, “These restrictions, which were favored by the American Hospital Association, were included to address potential financial conflicts of interest with doctors referring patients to their own hospitals and concerns that physicians may be referring the healthiest patients to their own hospitals,” but “Those concerns may have been overstated.” “[M] many studies suggest physician-owned hospitals provider higher-quality care” and…
“According to a study published by the Journal of the American College of Surgeons, physician-owned surgical hospitals outperform other hospitals in the Medicare value-based purchasing program.”
”More than 40 percent of physician-owned hospitals received the top 5-star rating in a 2015 release by the Centers for Medicare and Medicaid Services (CMS), compared to only 5 percent of general hospitals,” and “patients are 3-to-5 times less likely to experience complications at a physician-owned specialty hospital than at a general hospital.”
While not banned outright, new POHs and expansions of existing POHs are limited to certain shortage situations in rural areas by Sec. 6001 of the Affordable Care Act that none have been built or expanded since its enactment.
Site neutrality: are they proposing actions already taken?
Other than suggesting that state Medicaid programs implement site neutrality, it wasn’t clear from the 114-page federal plan how its site neutrality proposal differs from the CMS site neutrality rules already set to go into effect on January 1 (“CMS Finalizes Outpatient ‘Site Neutrality’ Rules,” Orthopedics This Week, November 14, 2018).
The policy paper says, “Congress should establish site neutral payment policies based on the anticipated clinical needs and risk factors of the patient, rather than the site of service. In delivering these reforms, Congress should account for differing levels of patient acuity,” and “State Medicaid programs should embrace site neutrality as a goal and reform their payment systems to pay for the value delivered where value is defined according to a relatively limited, straightforward, and non-gameable set of metrics.”
Is there any prospect of federal legislation on POHs?
Identical, very brief bills to repeal the ACA restrictions, the “Patient Access to Higher Quality Health Care Act of 2017,” have been sitting in the Senate Finance Committee (S1133) and in dual referrals to the House Ways and Means and Energy and Commerce Committees (HR1156) since early 2017. The bills are rated by the website Govtrack.us as having a 3% chance of being passed, but such predictions can quickly become irrelevant in a lame-duck session of Congress when a bill is backed by the White House. The fact that these companion bills are so brief—a single paragraph—would make it simple to attach the legislation to any of the several bills needed to keep the government operating.
