Hospitals unhappy with proposals
WASHINGTON – The Medicare Payment Advisory Commission (MedPAC) recommended in early January that Congress provide an update of 1.0 percent for fiscal year 2013 inpatient and outpatient hospital payments and reduce Medicare payment rates for non-emergent hospital visits to be the same as payments made for equivalent services delivered at doctor’s offices.
As hospitals acquire physician practices in record numbers, more and more routine visits and consultations are taking place in hospital outpatient departments for which Medicare currently pays a higher reimbursement rate than for visits in a traditional office setting.
American Hospital Association president and CEO Richard Umbdenstock said U.S. hospitals were “very disappointed” with the MedPAC recommendations regarding changes to hospital payments.
“Cutting hospital reimbursement for evaluation and management services in hospital outpatient departments threatens patient access to care that is not otherwise available in a community,” Umbdenstock said. “The cuts to outpatient services in addition to other MedPAC-recommended reductions ultimately would jeopardize patient access to unique, vital care.”
The AHA is urging Congress to reject MedPAC’s recommendations regarding the changes to outpatient care reimbursement.
Blair Childs, senior vice president of public affairs at the Premier healthcare alliance, said if adopted, the recommendation would “significantly stall” movement toward health system integration and coordination of care.
“The policy also fails to recognize the substantial difference in resource use and costs to furnish E&M services in the hospital outpatient department vs. a physician office,” Childs said. “MedPAC should conduct an in-depth data analysis – as it traditionally undertakes – before it recommends a reimbursement change of this magnitude.”
In addition to the E&M changes, MedPAC also recommended:
• Congress provide a 0.5 percent update for ambulatory surgical centers in calendar year 2013, require them to submit cost data and direct the Health and Human Services secretary to implement a value-based purchasing program for ASCs no later than 2016.
• Long-term care hospitals, skilled nursing facilities and inpatient rehabilitation facilities receive a 0 percent market-basket update for fiscal year 2013.
• A 1.0 percent update for the end-stage renal disease prospective payment system
• A 0.5 percent update for hospice providers.
• Revising and rebasing the skilled nursing facilities PPS, which would increase payments to hospital-based
SNFs by 27 percent on average, and reducing payments to SNFs with relatively high readmission rates.
The Alliance for Quality Nursing Home Care blasted MedPAC for not providing a cost of living adjustment for skilled nursing facilities and for its proposed guidance on the prospective payment system, saying in a statement that it is “deeply disturbed by MedPAC’s continued failure to recognize the obvious link between Medicare and Medicaid in financing SNF care.”
“With long term and post-acute care providers across the nation beset by a barrage of federal and state budget cuts already jeopardizing seniors’ care, and causing front line care job losses, we are alarmed by MedPAC’s recommendation of no market basket increase for FY 2013,” said Alan Rosenbloom, the Alliance's president. “When combined with the Affordable Care Act requirement that CMS reduce annual market basket increases by productivity adjustment, MedPAC’s recommended freeze effectively translates into a cut from current payment levels, not merely a failure to increase payments to account for cost increases.”