CHA News Article

MedPAC Adopts Positive Recommendations for Hospital Payments in FY 2014

The Medicare Payment Advisory Commission (MedPAC) met today after an extensive closed door executive session to adopt several recommendations regarding Medicare fee-for-service payment and policy changes for Congress to consider for calendar year (CY) and federal fiscal year (FFY) 2014.  The commission reaffirmed its draft December recommendation of a positive 1 percent increase overall in payments for hospital inpatient and outpatient services. CHA appreciates MedPAC’s clarification that the adopted recommendation incorporates the impact of cuts to hospitals from the recently passed American Taxpayer Relief Act (ATRA). Although MedPAC currently estimates a potential negative 0.6 percent update for the FFY 2014 inpatient prospective payment system, its recommendation calls for Congress to increase that update to 1 percent, which is estimated to cost the federal government $750 million to $2 billion.

MedPAC only briefly discussed its previous recommendation to reduce rates for evaluation and management codes applicable to outpatient office visits to equal the amounts paid to doctors under the physician fee schedule.  MedPAC did not put this recommendation forward this year, but it continues to get much attention from members of Congress as part of the continuing fiscal cliff negotiations. Information on post-acute care recommendations will be reported in CHA News tomorrow.