Medicare payment cuts sought for nursing homes and other providers

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On Tuesday, a key congressional advisory group recommended increasing Medicare payment rates for acute care hospitals, long-term care hospitals and outpatient dialysis centers next year, while calling for a reduction 5% salary for nursing homes, home health agencies and inpatient rehabilitation. facilities.

The Medicare Payment Advisory Commission’s March annual report to Congress called on lawmakers to maintain 2021 payment rates for outpatient surgical centers, hospice providers and clinicians paid under the physician fee schedule.

The commission, an independent agency of Congress created by the Balanced Budget Act of 1997, advises Congress on matters related to the Medicare program. Lawmakers may or may not follow the commission’s recommendations, which aim to provide quality care to recipients and incentives for providers to contain costs and reduce program spending.

Acute and long-term care hospitals would see a payment increase of about 2% while dialysis centers would receive a wage increase of about 1%, said James Mathews, executive director of the commission, during a a press briefing on Tuesday.

The report discusses the effects of the Covid-19 pandemic and some of the resulting policies. But the panel’s burden is to assess whether Medicare payments support efficient care delivery and ensure beneficiary access.

“To the extent that the effects of the pandemic are temporary or vary significantly from provider to provider within an industry, they are best addressed through targeted temporary funding policies rather than permanent changes to payment rates in 2023. and beyond,” the commission said in a statement.

More Information Wanted

The committee also recommended that the health and human services secretary require home health agencies, hospices and doctors and other health professionals to provide more information about telehealth services than they provide in order to better assess the impact of services on access, quality, and costs.

In addition, the commission recommended that day surgery centers provide annual cost reports to the Centers for Medicare & Medicaid Services. The commission has asked HHS to require such reports from surgical centers since 2009.

Without documentation of revenues and profit margins, the commission says it’s difficult to recommend payment rate adjustments for surgical centers. A commission analyst said the cost reports could be limited in scope to reduce the administrative burden.

The commission recommended a 20% reduction in Medicare’s annual per-patient payment limit, or “overall cap,” for hospice providers. The overall palliative care cap is currently just over $31,000. If a hospice provider’s annual Medicare payments divided by the number of beneficiaries exceeds the cap amount, the facility must reimburse the excess payments.

The commission also recommended that a salary adjustment, to take into account regional salary differences, be added to the overall ceiling.

Lack of Medicare Advantage savings

The report also estimates that 46% of Medicare beneficiaries were enrolled in private Medicare Advantage plans in 2021, a 10% increase from 2020, Mathews said. And the average MA plan offer was 15% less than what traditional Medicare spends for similar beneficiaries. But taxpayers and fee-for-service recipients — who help fund the Medicare Advantage program with their Medicare outpatient premiums, or “Part B,” “are not seeing any savings from the efficiency of the MA plan,” says the committee’s press release.

“Instead, we estimate that Medicare spends 4% more on MA enrollees than it would have spent had those enrollees remained in FFS Medicare. Overall, throughout their Medicare participation, private plans never produced savings for Medicare.

Mathews said that as master’s enrollment increases, “overpayment will become increasingly problematic,” given the effects on Medicare spending and the precarious solvency of the Medicare trust fund.

In light of Medicare’s financial concerns, Mathews reiterated the commission’s earlier recommendations that call for limiting intensive coding, or “upcoding,” practices by Medicare Advantage clinicians, and changing the way Medicare calculates benchmarks. , or spending targets, which are used to determine capitation payments. to MA diets.

By reducing payments to MA plans, these earlier recommendations “would help ensure the sustainability of the Medicare program and the solvency of its Hospital Insurance Trust Fund, which pays for stays in hospitals, skilled nursing facilities, and hospices.” for eligible recipients, Mathews said.

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