Hospitals and physicians may not receive their annual Medicare reimbursement increases in fiscal 2000 because HCFA will be devoting its resources to fixing the year-2000 computer problem, according to an internal HCFA memorandum obtained Friday by MODERN HEALTHCARE.
"Because we will be in a critical stage of implementing Year-2000-compliant systems between October 1999 and February or March 2000, we will not be able to make even the routine updates for hospital PPS and the . . . physician fee schedule for fiscal year 2000," according to the memo, which was sent June 11 from HCFA Administrator Nancy-Ann Min DeParle to HHS Assistant Secretary Kevin Thurm.
The implementation of new Medicare prospective payments systems-one for home health services and another for hospital outpatient care-also will be delayed because of the computer problems, DeParle said in the memo. Both of those systems were enacted as part of last year's balanced-budget law. The outpatient PPS is to take effect Jan. 1, 1999; the home health PPS would follow on Oct. 1.
News of the delays drew criticism from House Ways and Means Committee health subcommittee chairman William Thomas (R-Calif.). "I am very disappointed," he said in a statement. "It's not fair to the seniors in this country to promise them more healthcare choices and then deny them the means to make those choices."
Thomas scheduled a congressional hearing in his committee for July 16 to look into the implementation delays.
DeParle said HCFA is developing a legislative proposal in an effort to get Congress to change last year's balanced-budget law to push back some of the implementation dates. HCFA also is seeking Congress' approval to delay the hospital and physician Medicare reimbursement updates.
Hospital inpatient reimbursement rates were frozen in fiscal 1998 under last year's balanced-budget law, but an update averaging 0.7% has been proposed for fiscal 1999, which begins Oct. 1 (May 11, p. 8).