Budget deal delays DSH cuts, repeals ACA panel, changes MIPS cost component

The second federal government shutdown of 2018 lasted only six hours, but the budget deal that ended it will have an impact on the healthcare industry for years to come through changes to Medicare payments, the Merit-based Incentive Payment System (MIPS) and repealing one of the most controversial parts of the Affordable Care Act (ACA).

The legislation signed into law by President Donald Trump Friday morning had some additions from the House bill passed days earlier. A total of $2 billion in funding for the National Institutes of Health (NIH) was added for fiscal years 2018 and 2019.

“With the passage of this funding bill, Congress is clearly reflecting our national desire to make faster scientific progress,” Bruce Johnson, MD, president of American Society of Clinical Oncology (ASCO), said in a statement.

Another new provision was the repeal of the ACA’s Independent Payment Advisory Board (IPAB). This was the source of the “death panel” claims by ACA opponents when the law was being debated, though the board’s real function was to require mandatory cuts to Medicare when spending exceeded certain benchmarks. Spending was never high enough to trigger its formation and it was repeatedly targeted by both Democrats and Republicans for repeal in the years since the ACA was passed.

Larry Levitt, senior vice president of the Kaiser Family Foundation, said the repeal of IPAB and delays in many of the ACA’s taxes “reveals a bipartisan consensus that health care cost containment generally seems better in theory than in practice.”

The law kept many of the provisions from the House bill, like delaying cuts to Medicare Disproportionate Share Hospital (DSH) payments by another two years and adding additional “flexibility” to the cost component of MIPS. That component will make up 10 percent of a clinician’s MIPS score for 2018 but CMS can now opt to keep it at the 10 percent level through 2021. The legislation prevents the agency from pushing it any higher than 30 percent in any subsequent year.

“The Bipartisan Budget Act of 2018 is largely a win for physician practices,” said Anders Gilberg, senior vice president of government affairs for the Medical Group Management Association (MGMA), while adding that “Congress’ use of a .25 reduction to the Medicare physician payment update next year as a budgetary offset is a disappointment in an otherwise favorable bill.”

In a more specialized change, the spending law freezes payment rates for radiation treatment delivery and image guidance outside of hospital-based departments through the end of 2019, a provision supported by the American Society for Radiation Oncology (ASTRO).

“We are grateful to our champions in Congress for continuing to support the critical role radiation therapy plays in cancer treatment for the more than one million patients each year who will access radiation therapies to cure or palliate their disease," ASTRO chair Brian Kavanagh, MD, MPH, said in a statement.