The House last night approved by voice vote the Helping Hospitals Improve Patient Care Act, H.R. 5273. The AHA-backed legislation would revise Section 603 of the 2015 Bipartisan Budget Act to move the grandfather date for off-campus hospital outpatient departments (HOPD) under development from Nov. 2, 2015 to Dec. 31, 2016 or 60 days after enactment, whichever is later.

Current law reimburses grandfathered facilities at the HOPD rate, while new facilities are capped at the lower Physician Fee Schedule rate.

House Ways and Means Health Subcommittee Chairman Rep. Pat Tiberi, R-Ohio, and ranking member Jim McDermott, D-Wash., introduced the bill to help address hospital concerns on the HOPD payment changes and the Hospital Readmission Reduction Program. The bill would adjust the readmissions program to account for socioeconomic status. 

The Hospital Readmissions Reduction Program, a part of the Affordable Care Act, reduces Medicare reimbursements for hospitals deemed to have excess readmissions. Hospitals are slapped with a reduction in payment of up to 3% if their 30-day readmission rates exceed what was expected for heart attack, heart failure, pneumonia, chronic obstructive pulmonary disease and hip and knee replacement.

Hospitals contend that Medicare needs to account for socioeconomic and other social risk factors beyond hospitals’ control when measuring hospitals’ performance in the program.

Under the House-passed legislation, readmissions penalties would be adjusted by comparing hospitals with similar populations of Medicare and Medicaid patients. Those adjustments would eventually change to a “more refined” method based on federal analysis required by the Improving Medicare Post-Acute Care Transformation Act.

H.R. 5273 also would extend the Rural Community Hospital Demonstration Program for another five years. It’s set to expire at the end of this year. The program helps rural hospitals – so-called “tweeners” – in sparsely-populated states that are too big to qualify for critical access status, but struggle to keep their doors open under Medicare’s prospective payment system. The program tests the feasibility of a cost-based payment model for these hospitals.

The AHA supports the bill’s HOPD, readmissions-adjustment and rural hospital provisions.

“This legislation will help patients by mitigating some of the negative impact of the 2015 Budget Bill and will improve access to care,” said AHA President and CEO Rick Pollack. “It also will ease penalties experienced by hospitals and health systems who treat the most vulnerable patients.”

The House Ways and Means Committee last month passed the legislation, which now goes to the Senate.