Moody's: Hospital expenses outpace revenues for first time in 3 years   08/23/2013
Expenses grew faster than revenues for not-for-profit hospitals in fiscal year 2012, according to a report released today by Moody's Investors Service, a situation the credit rating agency calls “unsustainable.” Expenses grew by a median 5.5% for 402 hospitals and health systems rated by the agency, while median operating revenues grew just 5.2%. Moody’s expects operating performance for the sector to remain weak. “We expect revenue growth will remain pressured in FY 2014 following the Centers for Medicare & Medicaid Services’ final ruling that hospitals will receive a slim 0.7% net increase on inpatient reimbursement rates in federal FY 2014,” writes Deepa Patel, Moody's assistant vice president/analyst. “The continued sequestration and Medicare disproportionate share reductions that begin on Oct. 1, 2013 will also hamper performance. Further, many hospitals report that rate increases from commercial payers are lower than historical levels.…Most management teams will respond aggressively with expense growth containment strategies to combat limited revenue growth. However, it will be difficult to make swift expense reductions since many cost savings measures have been exhausted following the recession.”
HHS processing CAC applications, posts training   08/23/2013
The Department of Health and Human Services has received more than 1,000 applications from organizations, including hospitals, interested in training staff and volunteers to become Certified Application Counselors, and is working to process them as quickly as possible, according to agency staff. Beginning Oct. 1, CACs will help people understand and apply for individual and small group health insurance coverage through the health insurance marketplaces, or exchanges, created by the Patient Protection and Affordable Care Act. According to HHS, applications for CACs in states with Federally-facilitated and State Partnership marketplaces will be processed on a rolling basis, with new CACs announced every two weeks. Once approved, applicants must log on and complete about five hours of online training at, where the public can also view the course content. The Health Resources and Services Administration’s Office of Rural Health Policy will host an Aug. 28 conference call and webcast on the CAC training materials. Participants are encouraged to browse the course content before the call and send any questions to To access the call, from 3-4 p.m. Eastern Time, dial (800) 857-3749; passcode ORHPACA. The call is part of a weekly ORHP series on ACA topics. To join the listserv for the call series, email
CBO report looks at reasons for Medicare spending slowdown   08/23/2013
Changes in Medicare payment rates and in beneficiary demand for services account for only about one-quarter of the slowdown in fee-for-service Medicare spending growth for elderly beneficiaries between 2000 and 2010, according to a new report from the Congressional Budget Office. While the other causes of the slowdown remain unclear, it “appears to have been caused in substantial part by factors that were not related to the recession’s effect on beneficiaries’ demand for services,” the report states. “Some of the other influences on Medicare spending that may have contributed to the slowdown, such as changes in how care is delivered to beneficiaries, might well have persistent effects on spending growth. The fact that growth slowed even further in 2011 and 2012 for the fee-for-service portion of Medicare indicates that the slowdown persisted, and perhaps intensified, after our study period. That view is consistent with CBO’s recent forecast of Medicare spending growth, which projects slower growth in the next few years than prior forecasts anticipated.”