The Medicare Payment Advisory Commission has issued a preliminary recommendation that hospitals receive a payment increase of 0.4 percentage points below inflation in fiscal 2005. That would amount to a 2.8% increase in payment rates. If adopted, the recommendation, which MedPAC commissioners have yet to formally approve, would pay hospitals less in 2005 than they would receive under current law. Under the Medicare reform bill passed by Congress last month, hospitals that publicly report quality data would receive a full inflation update in 2005. All hospitals would receive a full inflation update in 2004. Some analysts said MedPAC has yet to digest the Medicare bill and incorporate its provisions into the recommendation process. MedPAC also estimated the overall Medicare margin for 2002 at 3.2%, down from 4.2% in 2001. Margins will approximate 2.8% in 2004, MedPAC predicted, but the Medicare bill could increase that figure. -- by Jeff Tieman
MedPAC proposes less-than-inflation update
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.