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Policy Snapshot

November 12, 2024

With the 2024 election now behind us, PALTmed is poised to monitor several key issues in the coming months as the new Congress takes shape. The Senate has shifted to a Republican majority, currently standing at 53-47. Meanwhile, the House of Representatives remains undecided but likely to remain the same, with 214 Republicans and 205 Democrats currently.

Lame Duck

Congress reconvenes this week, and they are expected to focus on leadership elections. The legislative process will move into high gear when Congress returns after the Thanksgiving break. Lame duck sessions can go in many different directions. Ultimately, any lame-duck session requires consensus, with the goal of passing key legislation in a short period.  Given the current political landscape, it remains uncertain how members of the 118th Congress will collaborate on key priorities. Some items, such as passing or extending funding for the government, are “must-pass bills.”  A spillover from the election and open seats could affect lame-duck legislation, impacting the overall end-of-year package and leaving items for the next Congress.

CR or Omnibus Package

The current Congressional Resolution (CR) funding for the government expires on December 20.  As stated earlier, funding the government remains the highest priority for the returning Congress. Expiring or must-pass provisions of relevance to PALTmed include Medicare physician fee schedule relief as well as extension of expiring Medicare telehealth flexibilities. Presumably, the funding bill, whether it takes the form of a CR or an omnibus package, will include these items. There is some uncertainty regarding the approach Congress will take—whether to pass a comprehensive funding bill for the remainder of the fiscal year or to opt for a CR that allows for further consideration of funding issues in the next session.

Medicare Payment Update

On November 1, the Centers for Medicare & Medicaid Services (CMS) released the calendar year (CY) 2025 Medicare Physician Fee Schedule (PFS) final rule. In accordance with the statute, CMS reduced average payment rates under the PFS by 2.83% in CY 2025 compared to the average payment rates for CY 2024. This amounts to a finalized CY 2025 PFS conversion factor of $32.3465, a decrease of $0.94 (or 2.83%) from the current CY 2024 conversion factor of $33.2875.

On October 29, a bipartisan group of House members introduced the Medicare Patient Access and Practice Stabilization Act of 2024 (H.R. 10073). This bill proposes a 4.73% payment increase for physicians in 2025.  On October 11, a bipartisan majority of the House of Representatives signed onto a letter that urges House leadership to “expeditiously pass legislative fixes” that stop a 2.8% Medicare physician payment cut slated for January 1 and give physicians a payment.

The 2.8% reduction proposed in the 2025 Medicare Physician Fee Schedule (MPFS) marks the fifth consecutive year that the CMS fee schedule proposal lowered payments to physicians and other clinicians. Congress must act by December 31, 2024, to avoid the Medicare reductions imposed by the CY 2025 PFS.  It’s likely that Congress will include some Medicare fee relief in any omnibus package or CR passed this year while leaving long-term physician fee reform on the table. 

Telehealth

Congress has extended several pandemic-era flexibilities around Medicare coverage of telehealth beyond the COVID-19 public health emergency, but most of these flexibilities are due to expire in December of this year. There is bipartisan support for proposed legislation to extend these provisions for another two years. Congress is also weighing the permanent expansion of Medicare coverage of telehealth services.  The cost of permanent expansion is high; therefore, a two-year extension is most likely.  Under this scenario, post-acute and long-term care (PALTC) providers can continue to use the telehealth flexibility in the PALTC setting. 

In the CMS Physician Fee Schedule Final Rule for 2025, they did delay suspending the frequency limitations for subsequent nursing facility visits (99307-99310) through CY 2025. CMS indicated that by pausing the frequency limitations, they would gather an additional year of data to determine how practice patterns are evolving and what changes, if any, to frequency imitations should be made. 

Staffing Rule 

Repeal of the nursing home staffing rule is a possible action item during the lame-duck session. Congress could use up to $22 billion in savings from fully blocking or delaying CMS’ implementation of the nursing home minimum staffing rule to pay for other health-care priorities.  It remains unclear whether Congress has the votes for this action, given the tight margin in the Senate and opposition from some Republicans in the House. 

In March, the House Ways and Means Committee advanced the Protecting American Seniors Access to Care Act (H.R. 7513) that would block CMS from finalizing the rule. After the rule was finalized, House Republicans introduced legislation to overturn the rule using the Congressional Review Act, meaning it needs a simple majority for passage. A few weeks after the Senate bill, S. 3410, was released, the Congressional Budget Office scored H.R. 7513 as saving $5.8 billion over five years and $22 billion over 10 years.

CHANGE Act

The Ways and Means Committee passed The Concentrating on High-Value Alzheimer’s Needs to Get to an End (CHANGE) Act (H.R. 4752/S.2379) as part of a larger package earlier this year. The bill improves the Welcome to Medicare and Medicare Annual Wellness Visits by authorizing clinicians to use tools identified by the National Institute on Aging (NIA) to complete the cognitive assessment component of the visits.  Given the overwhelming bipartisan vote for the measure in committee, Congress could include this provision in a final omnibus package. PALTmed is part of a coalition supporting this bill. 

Looking to the 119th Congress 

Staffing Rule

If Congress does not delay or repeal the staffing rule during the lame-duck session, it is likely that the incoming administration will consider rescinding it. The CMS rule is currently facing several legal challenges. Additionally, the Supreme Court’s recent decision regarding Chevron deference means that courts are no longer required to defer to agency interpretations, which could influence the rule’s future. There is also notable opposition to the rule from some lawmakers, which may impact its implementation.

Medicare Fee Update

CMS is statutorily required to impose Medicare physician payment fee cuts.  Congress will again have to consider whether to partially or fully delay the cuts or to consider a longer-term solution to the perennial problem. 

Medicaid

While the incoming administration has not provided specific details regarding potential Medicaid reductions, Medicaid remains a crucial funding source for long-term care. Discussions around Medicaid cuts often center on their potential to finance the extension of expiring tax breaks and facilitate reforms within the program. There has been ongoing interest among some lawmakers in capping federal allotments to states, which could result in funding reductions. Additionally, administrative changes may be considered, including the possibility of implementing work requirements for beneficiaries in certain states.

21st Century LTC Caucus

The 21st Century Long-Term Care Caucus was established in 2022 by Reps. Bryan Steil (R-WI), Annie Kuster (D-NH), and Debbie Dingell (D-MI) to address the evolving needs of long-term care in the United States. This bipartisan group aims to enhance the quality of care for seniors and individuals with disabilities, focusing on policies that support caregivers, improve access to services, and ensure sustainable funding for long-term care facilities.

With the recent retirement of Rep. Kuster, the leadership of the Caucus now falls to Reps. Steil and Dingell. Their continued collaboration is crucial as they navigate the complexities of long-term care legislation, especially in light of the ongoing challenges posed by an aging population and the impacts of the COVID-19 pandemic on health-care systems.

As they move forward, Reps. Steil and Dingell will likely prioritize bipartisan initiatives that can garner broad support, ensuring that the needs of vulnerable populations remain at the forefront of legislative discussions. This collaborative approach is essential for creating effective policies that address the diverse challenges faced by long-term care providers and their residents.