MedPAC recommends higher pay for docs, hospitals in 2018, but not for ASCs

Medicare payments to physicians and hospitals should increase in 2018, but a planned payment bump for ambulatory surgical centers (ASCs) should be scrapped, according to the Medicare Payment Advisory Commission (MedPAC).

The commission, which advises Congress on Medicare payment policies, met Dec. 8 to discuss its suggestions for 2018 payments. It agreed on recommending a 1.85 percent increase in hospital inpatient and outpatient department (OPDs) services and a 0.5 percent bump for acute-care hospitals.

For ASCs, the commission said there are advantages for those facilities, as their lower payment rates compared to hospitals can cut down on spending. There were concerns, however, about “induced demand” at ASCs because of physician ownership as well as a lack of a requirement for those facilities to submit cost data.

“Given our findings of payment adequacy and our stated goals, eliminating the update is warranted. This is consistent with our general position of recommending updates only when needed. Moreover, we want to provide motivation for submitting cost data,” said MedPAC senior analyst Zachary Gaumer.

Overall, ASCs received $4.1 billion for serving 3.4 million Medicare beneficiaries in 2015, which Gaumer and other analysts argued show the centers are financially healthy at current rates and don’t need a 2 percent increase.

Similar logic was used to argue no rate increase was needed for skilled-nursing, hospice and long-term care facilities in 2018. Inpatient rehabilitation centers and home health agencies could see slight cuts.

The commission will meet again on Jan. 12, 2017, to take a vote on its payment recommendations. They will then be included in its March report to Congress and HHS, though neither is required to go along with the payments MedPAC suggests.