MedPAC Recommends Payment Cuts for Certain Urban Off-campus EDs

The Medicare Payment Advisory Commission today approved a recommendation to reduce emergency department payment rates by 30% for off-campus stand-alone EDs located within six miles of an on-campus hospital ED. The AHA earlier this week urged MedPAC not to approve the recommendation, saying it was not based on any analysis of Medicare beneficiaries, Medicare costs or Medicare payments and would make Medicare’s record underpayment of outpatient departments and hospitals even worse. Medicare margins were a record-low negative 14.8% for hospital outpatient departments and negative 9.6% for hospitals overall in 2016, with the latter expected to reach negative 11% this year. MedPAC today also voted to approve an AHA-supported recommendation to allow isolated rural hospitals located more than 35 miles from another ED to convert to stand-alone EDs that would be able to bill under the outpatient prospective payment system. These EDs also would be provided with annual payments to assist with their fixed costs. AHA had urged the commission to consider expanding the recommendation to include EDs in vulnerable urban communities. In other MedPAC news today, the Commission discussed the potential to develop uniform quality measures for skilled nursing facilities, inpatient rehabilitation facilities and home health agencies. These measures, staff argued, would provide comparisons across post-acute care settings and could be included in a future post-acute PPS. The commission also continued a discussion from October on a potential new, simpler value-based purchasing program that could replace the four current VBP programs for inpatient care.