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MedPAC Calls for Pay Raise for Doctors, Hospitals

Cheryl Clark, for HealthLeaders Media, March 16, 2011

"The current Medicare physician payment formula is broken, and the AMA will work with MedPAC and policymakers on both sides of the aisle to replace it with a system that better reflects the costs and practice of 21st century medical care and provides stability for physicians and their Medicare patients."

Among other MedPAC recommendations for the Centers for Medicare and Medicaid Services:

  • Hospitals should receive a 1% payment update for inpatient and outpatient services, and Congress should require the Secretary of Health and Human Services to adjust rates to fully recover all overpayments due to documentation and coding improvement.

  • Ambulatory surgical centers should receive a .5% pay increase.

  • Outpatient dialysis centers should receive a 1% pay bump.

  •  For skilled nursing facilities, Congress should eliminate the payment update, in part because it found that access to SNF services remains stable for Medicare beneficiaries, and available bed days increased 4% between 2008 and 2009. Also, MedPAC said it "examined relatively efficient SNFs and found that it is possible to have costs well below average, above-average quality and more than adequate Medicare margins."
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