Digital News Report – A new report from the Institutes of Medicine points out problems with Medicare payments and the government needs to have a better way to calculate adjustments to insure accurate and fair payments. The report found that around 40 percent of hospitals had granted exceptions for how they calculate for adjustments.
The way the current system works is that hospitals use Metropolitan Statistical Areas (MSAs) for short-term acute care facilities. The physicians along with Medicare Part B practitioners have 89 payment areas, which are 55 large metropolitan and 34 statewide urban and rural areas. Under the proposed changes, both the hospitals and physicians would use the MSAs to determine the payment areas and not use statewide criteria.
The current data sources are based on wage, rent, and commuting data, which has some outdated sources. The IOM report suggests that the data be more accurate independent data sources such as the BLS wage data. They also suggest using a new source of data based on the cost for commercial office rent.
Currently the Medicare Payment system only has a limited selection of occupations listed. The new proposal would be to include a wider range of medical occupations using BLS data. They also want to use the BLS’s median wage data to help calculate Medicare payments. In order for this to take effect for using BLS data, Congress will have to make changes to part of the Social Security Act.
Committee chair Frank Sloan, J. Alexander McMahon Professor of Health Policy and Management and professor of economics, Duke University, Durham, N.C. said they wanted to find a fair and accurate way to figure out Medicare payments. He said that medical professionals currently are skeptical about the way the payments are determined. The recommendations in this report he explains should help to make “reasonably accurate measures of regional differences in expenses.”
More reports from IOM concerning Medicare payments will be issued; one later this summer regarding physician payment issues, and a final report in 2012.
Congressman Sam Farr (D-Carmel) applauds the IOM report to correct the Medicare reimbursement payments. Farr said in a statement, Medicare underpays medical professionals in California, and doctors are not accepting new Medicare Patients. He adds that it makes it difficult for seniors and they often have to drive farther to get access to a doctor.
Farr has also introduced legislation several times in order to attempt to correct the Medicare payments. He introduced an amendment to The Affordable Health Care for America Act and the American Jobs and Closing Tax Loopholes Act but both times had his legislation blocked by the Senate.
By Victoria Brown