Healthcare Financial News

Medicare payment rates for inpatient hospitals for FY09 are estimated to increase by nearly $4 billion, according to a proposed rule issued by the Centers for Medicare and Medicaid Services (CMS) on April 14. Based on current data (the actual adjustment will use the most recent data available when the final rule is published), the market basket update will be 3.0 percent for hospitals meeting quality measure submission requirements (the few not submitting quality measures will have that update reduced to 1.0 percent). The outlier threshold (which also could be affected by data changes between now and when the rule is finalized) proposed is $21,025, down from the current $22,185.

The agency is also proposing additional steps to strengthen the tie between the quality of care provided to Medicare beneficiaries and payment for the services provided when they are in the hospital.

CMS is proposing to expand the list of conditions that are reasonably preventable through proper care and for which Medicare will no longer pay at a higher rate if the patient acquires them during a hospital stay. In addition, CMS is adding 43 new quality measures for which hospitals will have to report data to receive the full annual payment update for their services. The proposed rule would apply to services provided to patients who are discharged from the hospital during FY09, which begins on Oct. 1, 2008.

Also included in the CMS physician-related proposals are revisions to the self-referral rules, which would modify the physician self-referral “stand in the shoes” provisions in the definition of indirect compensation arrangements to:

• Accommodate certain financial transactions made between physicians and academic medical centers or integrated healthcare delivery systems
• Require a designated health services entity to stand in the shoes of an organization in which it has a 100 percent ownership interest

The rule would apply to more than 3,500 acute care hospitals paid under the inpatient prospective payment system. Comments on the proposed rule are due by June 13. Read the press release.

As the first of the nation’s 78 million baby boomers begin reaching age 65 in 2011, they will face a healthcare work force that is too small and woefully unprepared to meet their specific health needs, says a new report from the Institute of Medicine. The report, Retooling for an Aging America: Building the Health Care Workforce, calls for new initiatives, including training all healthcare providers in the basics of geriatric care and preparing family members and other informal caregivers, who currently receive little or no training in how to tend to their aging loved ones. Medicare, Medicaid, and other health plans should pay higher rates to boost recruitment and retention of geriatric specialists and care aides, said the committee that wrote the report.

The committee set a target date of 2030--the year by which all baby boomers will have turned 65 or older--for the necessary reforms to take place.

Healthcare workers should be required to demonstrate competence in basic geriatric care to maintain their licenses and certifications, recommends the report. Also, it calls on the healthcare professions and regulators to consider expanding the roles and responsibilities of healthcare providers at various levels of training, and recommends that the federally required minimum number of hours of training for direct-care workers be raised from 75 to at least 120. Read the report.