Issue link: https://beckershealthcare.uberflip.com/i/1007936
17 CFO / FINANCE CBO: Trump's 2019 budget will reduce federal healthcare spending by $1.3T By Emily Rappleye A $1.3 trillion reduction in healthcare spending under President Don- ald Trump's 2019 budget will help shrink the federal debt and deficit over the next decade, according to a May 2018 analy- sis from the Congressional Budget Office and the Joint Committee on Taxation. e CBO estimates the federal debt in 2028 will be equivalent to 86 percent of GDP un- der President Trump's budget — significantly lower than the CBO's baseline of 96 percent. e agency also estimates the president's bud- get will reduce the federal deficit by $2.9 tril- lion from 2019 to 2028 compared to the CBO baseline. e cumulative deficit from 2019 to 2028 is expected to reach $9.5 trillion. How- ever, under President Trump's 2019 budget, the deficit as a percentage of GDP would peak at 4.5 percent in 2019 and decline to ultimate- ly average 3.7 percent over the next decade, according to the analysis. ese savings come largely from a $2.1 tril- lion reduction in nondefense discretionary spending and a $1.3 trillion reduction in mandatory healthcare spending, according to the CBO. e healthcare spending reductions are almost entirely from modifications to the ACA. ose modifications include: • Repealing subsidies for health insur- ance bought on ACA exchanges • Repealing Medicaid expansion • Capping Medicaid spending by enrollee • Allotting $120 billion for state block grants in 2020 Additional changes that will affect healthcare spending include capping damages for med- ical liability lawsuits, a proposal to increase out-of-pocket costs for some drugs under Medicare Part D, and a proposal to reduce Medicare payments for some providers. Baseline projections are calculated using eco- nomic projections and budget estimates from the CBO and JCT. n 23-hospital system enters $14M settlement with feds over improper physician payments By Ayla Ellison M ercy Health, a 23-hospital sys- tem based in Cincinnati, agreed to pay the federal government $14.25 million to resolve allegations the system violated the False Claims Act, ac- cording to the Department of Justice. The settlement resolves allegations Mer- cy Health provided compensation to six referring physicians — one oncologist and five internal medicine physicians — that ex- ceeded fair market value of their services. The health system disclosed these issues to the DOJ. "When physicians are rewarded financially for referring patients to hospitals or oth- er healthcare providers, it can affect their medical judgment, resulting in overutili- zation of services and higher health care costs," said Acting Assistant Attorney Chad Readler, head of the DOJ's Civil Division. "In addition to yielding a recovery for tax- payers, this settlement should deter sim- ilar conduct in the future and help make health care more affordable." n Senator calls for federal investigation into Missouri hospital's billing practices By Ayla Ellison S en. Claire McCaskill, D-Mo., has asked HHS to examine questionable billing practices and a possible kickback scheme operated by Putnam County Memorial Hospital, a 15-bed hospital in Unionville, Mo. Ms. McCaskill requested the investigation after Missouri State Auditor Nicole Galloway found Putnam County Memorial Hospital received $92 million in insurance payments in less than a year for lab services that were performed at other facilities across the country. Hospital Partners, a Florida-based management company, took over op- erations of Putnam County Memorial Hospital in September 2016. The management company is co-owned by Jorge Perez and David Byrns, who became the hospital's CEO. Within days of the takeover, another compa- ny, called Hospital Laboratory Partners, which also has ties to Mr. Perez, was incorporated in Florida and began billing health insurers for laborato- ry work through Putnam County Memorial Hospital, including some tests that were not performed at the facility, according to an investigation by Side Effects Public Media, KCUR and KBIA. According to Ms. Galloway's report, Putnam County Memorial Hospital acted as a shell company by submitting claims for other labs and funnel- ing the insurance payments through the hospital. Hospital Laboratory Partners said the auditor's report mischaracterizes the payments. The company said Putnam County Memorial Hospital, a critical access hospital, is authorized to bill for off-site lab work. Ms. Galloway said the questionable billing at Putnam County Memorial Hospital highlights a national issue. "It has become clear that these bill- ing schemes extend well beyond Putnam County Memorial Hospital, and impact healthcare costs for all of us," she told the Kirksville Daily Express. "I will continue to get to the bottom of this matter to protect Missouri tax- payers, and my office will work with Sen. McCaskill and others in federal government to aid their investigation." n