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July 28—Echoing another recent government projection, the Medicare trustees concluded Monday that the program’s hospital insurance trust fund will last four years longer than projected in 2013.
The Medicare trustees, who include primarily senior Obama administration officials, concluded that the hospital insurance trust fund—the funding source for Medicare Part A—will remain solvent until 2030. The Congressional Budget Office concluded separately two weeks ago that solvency will extend to 2030.
The increased longevity was credited to lower-than-expected spending in 2013 for most categories paid by the fund, especially inpatient hospitals, and smaller-than-expected increases in utilization at inpatient hospitals, skilled nursing facilities, and home health agencies.
Despite the short-term good news, the trustees urged that “Congress and the executive branch work closely together with a sense of urgency to address the depletion of the” trust fund.
The projected extension in solvency came even though the trustees dropped from their calculations a deep cut in physician pay that is scheduled to occur next year as part of a cost-control measure established in the 1990s. Instead of including the cut—which is required by law—the trustees assumed Congress will keep delaying cuts that are called for by the sustainable growth rate formula, as it has done for 12 years.
The trustees assumed that physicians’ payment rates will increase at a 0.6 percent annual rate from 2016 through 2023.
The trustees also included in their calculations planned cuts to provider payments that are required by the Affordable Care Act. However, they warned that providers will need to find productivity improvements to prevent those cuts from harming patient care.
“The trustees believe that this outcome is achievable if healthcare providers are able to realize productivity improvements at a faster rate than experienced historically,” the report stated. “However, if the health sector cannot transition to more efficient models of care delivery and achieve productivity increases commensurate with economywide productivity, and if the provider reimbursement rates paid by commercial insurers continue to follow the same negotiated process used to date, then the availability and quality of health care received by Medicare beneficiaries would, under current law, fall over time relative to that received by those with private health insurance.”
Publication Date: Monday, July 28, 2014
Tom Myers, chief strategy officer, The SSI Group, discusses the shifting payment environment and how it affects providers' patient access and claims management processes.
Jeff Chester, senior vice president and chief revenue officer at Availity, shares his thoughts on "Revenue Cycle 2.0" and how to best meet its challenges.
Mitch Morris, vice chair and global leader, healthcare, Deloitte, and Michael O'Rourke, senior vice president and chief information officer, Catholic Health Initiatives (CHI), share perspectives on the need for transformational IT in health care today.
Brian Kueppers, founder and CEO, Apex, discusses the importance of a robust patient payment strategy in boosting organization revenue and enhancing patient satisfaction.
Brian Grazzini, CFO, HealthPort, describes the importance of efficient and compliant information exchange and audit management in helping HIM staff spend less time on paperwork and more on mission-critical projects.
Cindy Matthews, executive vice president, Community Hospital Corporation, discusses how rural and community hospitals can use collaborative partnering to position for success through tough market conditions.
Rick Heise, senior vice president, revenue cycle, at Cerner Corporation, discusses the importance of integrating clinical and financial data to excel in health care’s changing payment environment.
Russ Graney, founder and CEO for Aidin, and John Laursen, head of business development for Aidin, share insights on how to improve care transitions between acute and post-acute care settings and incentivize high-quality patient outcomes.
Scott Elston, strategic accounts manager, GE Healthcare Services, describes how substantial cost reduction in health care requires rethinking business strategy and asset use.
Robert Williams, MD, director, Deloitte Consulting LLP, and Arielle Freiberger, product strategist, ConvergeHEALTH by Deloitte, explain how sophisticated retrospective, real-time, and predictive data analytics can inform decision making to reduce costs and improve care.
Stuart Hanson, director of business development (healthcare solutions) at Citi Retail Services, discusses how improving the payment experience can benefit consumers and healthcare providers.
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