President Obama on July 17 sent a draft of legislation to Congress that would establish an Independent Medicare Advisory Council (IMAC), which would have the authority to make recommendations to the President on annual Medicare payment rates as well as other reforms.

Comprehensive health care reform legislation passed a significant milestone last week as Senate and House committees approved different legislative packages. At the same time, comments from the head of the Congressional Budget Office (CBO) put a damper on the potential further progress of the legislation.

House Democratic leaders unveiled a comprehensive health care reform plan on June 19, calling for the establishment of a public health insurance program that would compete with private insurers to lower costs. The proposal would create a Health Insurance Exchange to provide a functional marketplace for individuals and small employers to comparison shop among private and public insurers.

Few details of how the plan would be paid for were announced, and lawmakers said they were awaiting estimates from the Congressional Budget Office.

Members of both the House and the Senate have released draft summaries or draft legislative language for comprehensive health care reform legislation. Staff members of three House committees -- Ways and Means, Energy and Commerce, and Education and Labor – released a three-page summary of a possible health care reform bill that includes a public insurance option, insurance market reforms, and insurance premium support for families up to 400 percent of the federal poverty level.

President Obama is looking at making the recommendations made by the Medicare Payment Advisory Commission (MedPAC) each year easier to put into effect. In a letter to Sens. Edward Kennedy (D.-Mass.) and Max Baucus (D.-Mont.) sent June 2, Obama outlined several proposals to cut health care spending over the next 10 years, particularly in the Medicare program. 

Acute care hospitals will receive a net 0.2 percent increase in payments for inpatient hospitals services in fiscal year (FY) 2010 under the proposed rule for the inpatient hospital prospective payment system (IPPS). Hospitals face a net decrease in payments in FY 2011 and 2012 under the proposed rule.

CMS has determined that open and laparoscopic Roux-en-Y gastric bypass, laparoscopic adjustable gastric banding, and open and laparoscopic biliopancreatic diversion with duodenal switch in Medicare beneficiaries who have type 2 diabetes mellitus (T2DM) and a body mass index (BMI) less than 35 is no longer considered reasonable and necessary. It has been determined that these same procedures do improve health in patients with T2DM with a BMI greater than 35 so they are still considered reasonable and necessary in those situations.

CMS is hosting a Special Open Door Forum teleconference for Part A provider Recovery Audit Contractors (RACs) on April 8, 2009, from 2:00 to 3:30 EST. The purpose of the forum is to introduce providers to the new RACs and provide more information about the RAC program.

CMS notes that capacity is limited; participants may may begin dialing into this forum as early as 1:45 PM EST. Dial: 1-800-837-1935 and reference Conference ID 92490299.

Unplanned rehospitalizations of Medicare beneficiaries within 30 days leaving the hospital cost the program $17.4 billion in 2004, according to a study published April 2 on the web site of the New England Journal of Medicine. This equals about 17 percent of all hospital payments from Medicare in 2004. Almost one-fifth (19.6 percent) of beneficiaries discharged from a hospital that year were rehospitalized within 30 days. Only about 10 percent of these rehospitalizations were planned.

On February 17, 2009, WellPoint Inc. agreed to stop using the Ingenix database of reimbursement rates that New York Attorney General Andrew Cuomo called “defective and manipulated.”