Axios Vitals recent story on hospitals’ Medicare margins seemed to cherry pick data from a March Medicare Payment Advisory Commission (MedPAC) report to Congress to imply that hospitals “lose money” on Medicare because they are allegedly inefficient. However, the story left out some very relevant details. That same report actually identifies a subset of hospitals MedPAC deems ‘relatively efficient’ because they do consistently well on cost and quality metrics.  Yet, the Commission also found that even for these hospitals, Medicare does not cover the cost of providing care. According to MedPAC’s own data, Medicare has not fully covered the costs of caring for patients since 2002. Additionally, Medicare margins over the past two decades have steadily declined. In 2016, MedPAC found the average hospital had an overall Medicare margin of negative 9.6 percent and the projection for 2018 shows a further decline to negative 11 percent.  The truth is that MedPAC shows that government programs underpay for hospital services, in 2016 that figure was $68.8 billion. And yet that same year hospitals also provided $38.3 billion in uncompensated care. These relevant facts would have painted a more accurate and clear picture of the financial realities hospitals face.

 

Tom Nickels, Executive Vice President American Hospital Association

Related News Articles

Headline
The Department of Health and Human Services and the Centers for Medicare & Medicaid Services Aug. 21 announced the creation of a Healthcare Advisory…
Headline
A JAMA study published Aug. 18 found that plan design changes by Medicare Part D insurers, particularly for Medicare Advantage plans, following passage of the…
Chairperson's File
Public
The recently enacted One Big Beautiful Bill Act will bring big changes to health care. AHA President and CEO Rick Pollack joined me for a Leadership Dialogue…
Headline
The House Ways and Means Subcommittees on Health and Oversight held a joint hearing today to discuss lessons learned, challenges and opportunities to improve…
Headline
The AHA today expressed support for the Medicare Mental Health Inpatient Equity Act, a bill that would eliminate the 190-day lifetime limit on inpatient…
Headline
The AHA July 8 wrote in opposition to the “Patient Access to Higher Quality Health Care Act” (H.R. 4002), which would repeal current law banning the creation…