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AHA Eyes 'Extremely Challenging' 2014

John Commins, for HealthLeaders Media, January 24, 2014

Concerns About the Regulatory Environment
Ashley Thompson, AHA's senior vice president and deputy director for policy, says that on the regulatory front, hospitals will be focused on implementing new payment and delivery models, addressing the two-midnight rule, experimenting with accountable care organizations and bundled payments, and transitioning to electronic health records and ICD-10, the move to value-based purchasing, and new penalties for readmissions and hospital-acquired conditions.

"Many of these incentive programs are flawed and need to be reformed; for example, the readmissions program," Thompson says. "The government refuses to recognize the impact of socio-economic factors in patient readmissions. These factors, whether the patient is of a racial or ethnic background or low income are beyond a hospital's control. The result is that the hospitals that care for the most economically disadvantaged patients will actually receive the greatest readmission penalties. The formula is flawed and it will take away critical resources from those hospitals and patients that need them the most."

Reining in RACs
Thompson says the Recovery Audit Contractor program is another area that requires "fundamental reform."

"RACs are bounty hunters. They get a commission on every claim that they deny," she says. "Hospitals are forced to appeal a massive number of these claims to get paid for medically-necessary services. What most people don't realize is that the majority of these appealed claims, about 72%, are overturned by a judge in favor of the hospital," Thompson said.

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