Archive for hospitals

 

MedPAC to Congress: Cut Payments to Freestanding Emergency Facilities

The Medicare Payment Advisory Commission has urged Congress to reduce Medicare payments to freestanding emergency departments 30 percent.

The recommendation, approved by MedPAC earlier this month and to be included in its June report to Congress, notes that such facilities have a lower cost structure because they typically lack some of the equipment, personnel, and standby capabilities of hospital ERs.  In making its recommendation, MedPAC also noted that freestanding ERs typically treat patients whose conditions are not as severe as hospital ERs and tend to be located in areas that already have adequate access to hospital ERs.

While MedPAC’s recommendations are not binding on either Congress or the administration, its views are highly respected and often find their way into future Medicare policy development efforts.

Learn more about the MedPAC recommendation on Medicare payments to freestanding ERs and the reasons behind it in this Kaiser Health News report.

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Senate Committee Looks at 340B Program

The Senate Health, Education, Labor, and Pensions Committee (HELP) held a hearing last week on the 340B prescription drug discount program.

The hearing was prompted by complaints from pharmaceutical companies about the discounts they are required to provide to eligible providers and by concern that hospitals are insufficiently accountable for how they use the savings they derive from those discounts to serve their low-income patients.  In addition, the Centers for Medicare & Medicaid Services recently reduced its Medicare payments to participating hospitals.

During the hearing, Senate Republicans expressed support for the program but spoke of the need for greater transparency in the use of the savings the 340B program generates for hospitals and a clearer sense of how those savings benefit low-income payments.  Committee Democrats expressed similar concern but with less urgency.

Hospital industry representatives expressed concern that any new requirements could weaken the program and rejected the idea that savings are misused.  Committee members pushed back against these contentions.

The Senate HELP Committee intends to hold additional hearings about the 340B program.

Learn more about the 340B hearing and the concerns that led to in this Healthcare Dive article.

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Non-Profit Rating Downgrades Exceeded Upgrades in 2017

Moody’s downgraded more non-profit hospital credit ratings than it raised in 2017.

The credit-rating company attributed the downgrades to nursing shortages in some markets and rising pharmaceutical and supplies costs.

Nearly a third of the downgrades were in just two states:  Ohio and Pennsylvania.

Learn more about Moody’s 2017 downgrades and upgrades in this report from Becker’s Hospital Review.…

Safety-Net Hospitals Under the Gun

Safety-net hospitals across the country face a new challenge:  adjusting to several cuts in the supplemental payments they receive from the federal government to help them serve the low-income residents of the communities in which they are located.

First there is a $2 billion cut in Medicaid disproportionate share hospital payments (Medicaid DSH).  These are payments made to hospitals that serve especially large numbers of low-income patients.  These payments help safety-net hospitals with the unreimbursed expenses they incur caring for such patients.  This cut, mandated by the Affordable Care Act but twice delayed by Congress, took effect on January 1.  In many states the value of Medicaid DSH cuts will exceed the reductions in uninsured care that hospitals have experienced since the Affordable Care Act made health insurance more widely available.

Second there is a 28 percent cut in Medicare payments for prescription drugs dispensed through the section 340B prescription drug discount program.  This cut, too, took effect on January 1.

Finally, federal funding has lapsed for the Children’s Health Insurance Program (CHIP) and for community health centers.

Safety-net hospitals are considering a number of moves to offset these losses.  Among them:  reducing or eliminating services, laying off staff, discontinuing …

Medicaid Expansion Helps Save Hospitals

Hospitals in states that took advantage of the Affordable Care Act to expand their Medicaid programs are six times less likely to close than hospitals in non-expansion states.

And the impact of Medicaid expansion is even more beneficial for hospitals that serve rural communities.

These are among the new findings in a new study that examines the effect of Medicaid expansion on hospital finances and hospital closures.  Among those findings,

We found that the ACA’s Medicaid expansion was associated with improved hospital financial performance and substantially lower likelihoods of closure, especially in rural markets and counties with large numbers of uninsured adults before Medicaid expansion.

According to the study, these hospitals, as a result of Medicaid expansion, served fewer uninsured patients and provided less uncompensated care than they previously had, thereby improving their financial health.

For this reason, the study’s authors conclude that

Future congressional efforts to reform Medicaid policy should consider the strong relationship between Medicaid coverage levels and the financial viability of hospitals. Our results imply that reverting to pre-ACA eligibility levels would lead to particularly large increases in rural hospital closures. Such closures could lead to reduced access to care and a loss of highly skilled jobs,