Federal News

DOL Issues Proposal to Increase Salary Threshold for Overtime Pay 

On March 7, the U.S. Department of Labor (DOL) issued a new proposed rule to increase the salary threshold for employee overtime pay.  This was a revision of a proposed rule previously released by the Obama administration that was never implemented.

The current rule, set in 2004, provides that executive, administrative, professional and certain other employees who earn less than $455 per week ($23,660 annually) are eligible for overtime pay if they work more than 40 hours in a week. 

The Labor Department’s new proposal would raise the standard salary level to $679 per week, or $35,308 per year. That compares with a threshold level of $47,476 per year announced by the Obama administration in 2016, which was enjoined by the courts.  The new proposal, according to the Labor Department, was developed after input received during several in-person listening sessions held around the country and more than 200,000 comments as part of a 2017 request for information

While the proposal has been amended as compared to the one released in 2016, LeadingAge still has concerns about how the proposed rule would affect providers who depend on Medicare or Medicaid for payment.  “Unlike employers in other sectors, long-term services and supports providers, most of whom rely on Medicare or Medicaid as their primary payer source, cannot simply raise their prices in order to cover increased labor costs,” said Barbara Gay, Vice President for Public Policy Communications at LeadingAge. “A mandatory increase in labor costs will challenge our members, who are already contending with a severe workforce shortage, particularly among hourly staff.” 

More information about the proposed rule is available at www.dol.gov/whd/overtime2019. Once the rule is published in the Federal Register, the public will have 60 days to submit comments for consideration.

EPA Issues Drug Disposal Final Rule 

The Environmental Protection Agency (EPA) published a final rule on February 22, 2019: “Management Standards for Hazardous Waste Pharmaceuticals” (“Final Rule”). The Final Rule seeks to create regulations that are a better fit for health care providers, eliminate “sewering” of hazardous waste pharmaceuticals, and eliminate overlapping regulations between the Drug Enforcement Administration and the Food and Drug Administration. This rule was first proposed in 2015. 

Many types of health care providers are covered under the Final Rule including long term care facilities which are defined as hospice facilities, nursing facilities, skilled nursing facilities and skilled and nursing care parts of a life plan community (CCRC). In the 2015 proposed rule assisted living was included, but LeadingAge and other groups successfully argued that assisted living is not a health care environment and should not be included; in the end, the EPA agreed. 

The Final Rule has three major sections, but the one with the most immediate impact relates to the practice of disposing of certain pharmaceuticals by flushing them down a toilet or sink drain.  EPA characterizes this practice as “sewering” pharmaceuticals. Certain pharmaceuticals will be classified as hazardous waste and effective August 22, 2019, all health care facilities, including the long term care facilities listed above, will be prohibited from “sewering” those types of pharmaceuticals. The prohibition includes, but is not limited to: prescription drugs, over-the-counter drugs, compounded drugs, drugs remaining in a non-empty container, clean-up materials from spills of pharmaceuticals, homeopathic drugs and dietary supplements.  The Final Rule does not specifically list what pharmaceuticals are considered hazardous.  Rather a pharmaceutical is not hazardous if it is legitimately used/reused (e.g. lawfully donated for its intended purpose) or reclaimed.  Over-the-counter pharmaceuticals, dietary supplements and homeopathic drugs are not hazardous if there is a reasonable expectation of being legitimately used/reused (e.g. lawfully redistributed for its intended purpose) or reclaimed.  

The rule establishes three categories of hazardous waste pharmaceuticals: "potentially creditable" (a credit may be available for the pharmaceutical from the manufacturer), "non-creditable" (no credit potential because of breakage, expiration, repackaging, or dispensing) and "evaluated" (the pharmaceuticals is not eligible for a credit and is ready for disposal). These three categories were developed to be consistent with current practices in crediting health care facilities for some unused pharmaceuticals.  Ultimately, pharmaceuticals are disposed of as hazardous waste. 

Health care providers who have an existing disposal process, typically through a third party, will not be impacted. If a provider still disposes of pharmaceuticals by sewering, they will have to plan for proper disposal by August of this year. 

The Final Rule also creates a new Subpart P in the Resource Conservation and Recovery Act (the act giving EPA authority to regulate hazardous waste) having to do with the handling of hazardous waste pharmaceuticals.  However, except Iowa and Alaska, the states are required to adopt the provisions of Subpart P.  If they can adopt by administrative action, they have until July 1, 2021, to do so; if legislation is required, the deadline is July 1, 2022.



Protecting HCBS Clients Against Spousal Impoverishment 

Bills have been reintroduced in Congress that permanently protect Home and Community Based Services (HCBS) recipients against spousal impoverishment.   

Currently, spousal impoverishment protections in Medicaid prevent unnecessary financial harm in cases where one spouse needs long term services and supports in a nursing home or an institutional care setting. A provision of the Affordable Care Act that required state Medicaid programs to apply these rules to HCBS long-term care settings expired on December 31, 2018. Legislation enacted in January included a three-month extension to protect Medicaid HCBS recipients against spousal impoverishment. This extension expires March 31.  

Ensuring permanent protections for Medicaid recipients of HCBS against spousal impoverishment is crucial to the well-being of older adult recipients of HCBS and those who care for them. Spouses, providers and the Medicaid program will benefit from the certainty that this legislation will provide.


2020 Budget Proposal Would Slash Funding for Aging Services 

Work on the federal budget for fiscal 2020 kicked off on March 11, 2019, when President Trump submitted his administration’s proposals to Congress. LeadingAge has a number of concerns about the impact the President’s proposals would have in all areas of aging services.

For the budget category of domestic discretionary programs, which includes senior housing and home- and community-based services, the 2020 Trump budget invokes the draconian spending caps imposed under the Budget Control Act of 2011. In recent years, Congress has waived these caps because appropriators could not reasonably come up with sufficient program cuts to comply with the caps.  

The 2020 Trump budget would cut total funding for the Department of Housing and Urban Development by 16.4 percent below fiscal 2019 spending levels. The budget request calls for a five percent cut to the Section 202 program and the complete elimination of the Public Housing Capital Fund, the HOME program, and the National Housing Trust Fund. Funding for Section 811 housing for people with disabilities would be cut by almost one-third. President Trump's budget once again asks Congress to raise rents for HUD-assisted households, including elderly households. These kinds of proposals run directly counter to the need to preserve and maintain our present affordable housing stock and step up production to meet the needs of a growing senior population. More information 

On health care, the President’s budget proposals for Medicaid would cut federal spending on the program by $1.48 trillion over the next ten years. The Administration’s budget resurrects the call for the transformation of Medicaid into a block grant or system of per-capita capped payments to the states. We remain strongly opposed to this proposal, which would take billions of federal dollars out of the program at a time when many states are struggling to fund essential long term services and supports covered by Medicaid. The budget would eliminate state provider taxes. It also brings back the idea of imposing user fees on nursing homes for resurveys. 

Medicare spending would be reduced under this budget by $811 billion over ten years. Cuts to providers include the establishment of a unified system of post-acute care payment by 2025, with reduced annual payment updates to skilled nursing facilities, home health agencies, and inpatient rehabilitation facilities every year from 2020 through 2024. This proposal is projected to reduce Medicare post-acute care spending by $101.2 billion over 10 years. In addition, reimbursement for bad debt would be cut from the current 65 percent to 25 percent. 

In the area of research, the budget would cut funding for the National Cancer Institute by $897 million and the National Institute on Aging by $429 million. 

For home- and community-based services under the Older Americans Act and other aging services programs, the budget proposes to zero out falls prevention and chronic disease self-management programs. Supportive services and nutrition services would be flat-funded at 2019 levels. Family caregiver support would be cut by $31 million, Alzheimer’s Disease programs by $4 million, and Lifespan Respite Care by $1 million. Aging and disability resource centers would be cut by $2 million and assistive technology programs by $4 million. State Health Insurance Programs (SHIPs), which help older people navigate the health and long term services and supports system, would be cut by $13 million. Social Services Block Grants, which many states use to fund home- and community-based services, would be zeroed out. These are all small, cost-effective, chronically underfunded programs that help older people live in community-based settings as long as possible. With the growth in the over-65 population, these programs need increased resources, not cuts. 

Fortunately, the President’s submission of a proposed budget is only the first step in setting a budget and spending levels for the fiscal year that will begin on October 1, 2019. It is now up to Congress to determine spending levels for federal programs in fiscal 2020. We are urging Congress to reject this budget and to ensure that aging services providers have the resources essential to meeting the needs of people as they age.

SNF VBP Program: Phase One Review and Corrections Call — March 20 

CMS will host a Skilled Nursing Facility (SNF) Value-Based Purchasing (VBP) Program Review and Corrections process call on Wednesday, March 20, from 12:30 p.m. to 2:00 p.m.  Those interested in attending may Register   for the call through Medicare Learning Network events.

The call will offer participants the opportunity to learn about the SNF VBP Program Review and Corrections process and get answers to frequently asked questions about Phase One of the process. During the Review and Corrections period, SNFs have an opportunity to review and submit correction requests to quality measure information. Deadline for correction submission is April 1, 2019.  For more information: visit the SNF VBP Program webpage. 

A question and answer session follows the presentation; however attendees may email questions in advance to [email protected] with “SNF VBP Mar 20 NPC” in the subject line. These questions may be addressed during the call or used for other materials following the call.

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