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MedPAC issues March report to Congress

March 21, 2014

The Medicare Payment Advisory Commission March 14 released its March report to Congress, which details fee-for-service payment recommendations for 2015 approved by the commission in January. The commission is Congress’ top adviser on Medicare payment policy.

The recommendations call for a 3.25% increase in hospital inpatient and outpatient prospective payment system (PPS) payments. Concurrently, they would reduce or eliminate payment differences between hospital outpatient departments and physician offices for selected procedures and pay long-term care hospitals (LTCH) the same rates as general acutecare hospitals for cases involving patients who are not deemed “chronically critically ill” (CCI), defined as an intensive care unit stay of at least eight days.

Savings realized by cutting LTCH payments would be redistributed to create a new outlier pool for CCI cases treated in inpatient PPS hospitals. The LTCH policy would be phased in over three years. The commission also recommends that Congress freeze payments for LTCHs, inpatient rehabilitation facilities (IRF), ambulatory surgical centers, home health (HH), hospice and dialysis providers under Medicare prospective payment systems for 2015.

In addition, the commission recommends creating a readmissions reduction policy that would apply a penalty to HH payments for HH readmissions to hospitals that exceed a risk-adjusted target, and finalizes a recommendation to create a common post-acute assessment instrument for HH, skilled nursing facilities (SNF), IRFs and LTCHs in 2016. The commission also extends through 2015 its prior recommendation to freeze payments for SNFs and rebase the SNF PPS.

For more on the report, click on: http://tinyurl.com/ob45jsy.