CHA News Article

CMS Finalizes PSO Reporting Requirements

Yesterday, the Centers for Medicare & Medicaid Services (CMS) issued the attached final rule implementing a number of provisions of the Affordable Care Act (ACA), including the provision that hospitals must satisfy certain patient safety and quality improvement requirements to contract with a qualified health plan (QHP) through Covered California, the state’s health insurance exchange.

The ACA required QHPs to contract with hospitals that have more than 50 beds only if they meet certain patient safety standards, including the use of a patient safety evaluation system (PSES) and a comprehensive hospital discharge program. However, the final rule adopts the CMS proposal to phase in these changes over time. In phase one, CMS adopted its proposal to allow a QHP to contract with hospitals that have more than 50 beds only if they are either Medicare-certified (having a Medicare CCN) or are Medicaid-only and have been issued a Medicaid-only CMS certification number, even if they don’t use a PSES or meet other ACA patient safety standards. Phase one would begin Jan. 1, 2015, and last two years or until CMS issues further regulation. CMS discusses in the final rule its response to input received through comments on next steps in phase two of implementation.

CHA and the California Hospital Patient Safety Organization (CHPSO) sent comments generally supporting the CMS approach but were hopeful that the agency would move more quickly to address possible alternatives for hospitals to meet the requirements and enhance the capability of PSOs to provide lessons learned to providers.

The final rule also includes policies related to federally facilitated exchanges, including risk adjustment, reinsurance and risk corridor programs. However, most are unlikely to affect Covered California. A complete analysis and additional information regarding the final rule will be available on the CHPSO website later this week.