Some Medicare dollars that go toward hospital payments in fiscal 2009 should be reallocated and shifted toward pay-for-performance efforts, the Medicare Payment Advisory Commission recommended in its March report to Congress.
Congress should increase payment rates for inpatient and outpatient services at the full rate of inflation in fiscal 2009, which would amount to an increase of 3% to 3.5%, MedPAC Executive Director Mark Miller told reporters. But that increase would be concurrent with a pay-for-performance program, Miller said.
About 1% to 2% of hospital paymentsan estimated $1 billionwould be withheld and redirected toward pay-for-performance, he explained.
Part of the funding for this policy would come from reducing the adjustment for teaching hospitals, which we believe is set incorrectly, Miller said. The commission is recommending that Congress reduce the indirect medical education adjustment by 1 percentage point in fiscal 2009 and put those funds into the pay-for-performance pool for hospitals, Miller said.
The American Hospital Association has estimated that teaching hospitals could lose $900 million next year under such a proposal.
In other recommendations, MedPAC said Congress should direct HHS to make Part D claims data available on a regular basis to congressional support agencies and other government entities, as well as set some parameters on Medicare Advantage special needs plans, which limit enrollment to specific categories of beneficiaries, such as those with chronic conditions. -- by Jennifer Lubell
What do you think? Post a comment on this article and share your opinion with other readers. Submit your letter to Modern Healthcare Online at [email protected]. Please be sure to include your hometown and state, along with your organization and title.