Medicare Advisers Address Pay Disparities for Common Services

Congress’ advisers on Medicare will renew their call to change a system that now often pays hospitals more than private doctors’ office for delivering the same services.

The Medicare Payment Advisory Commission on Thursday began discussing draft recommendations for many services covered by the federal health plan for the elderly and disabled. The panel will vote next month on formal recommendations meant to aid the Centers for Medicare and Medicaid Services and Congress in setting annual reimbursement rates.

But MedPAC likely will skip that step for its recommendation on hospital payments, instead reiterating those it made for 2015 at the suggestion of MedPAC Chairman Glenn M. Hackbarth. He said at the opening of the meeting that the panel may in many cases restate its previous recommendations.

The 2016 recommendation on hospital payments consists of three connected parts. A recommended 3.25 percent payment hike for the hospital outpatient and inpatient services is combined with two steps that would address what MedPAC sees as areas for reducing or shifting expenses. The first would scrap or cut back payment disparities for some common services which Medicare pays more to hospital outpatient departments than it does to private medical offices. Another recommendation outlines steps to begin making long-term care hospital payment rates for cases where patients are not considered to be chronically critically ill equal to those for acute care hospitals. Any savings would be redistributed to create additional payments for cases where people with chronic conditions are critically ill.

Several MedPAC members stressed that they were only comfortable with this set of recommendations as a bundle. Craig Samitt, a longtime health system executive and MedPAC member, described it as “an all or nothing” approach.

“I would only suport this as a package,” said MedPAC member Scott Armstrong, who is president and chief executive of Seattle’s Group Health Cooperative.

Medicare paid $118 billion in 2013 for inpatient hospital services and $49 billion for outpatient ones.

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