Unbiased Analysis of Today's Healthcare Issues

Did Hospital VBP work?

How can Medicare improve quality and reduce cost? One idea is to introduce value-based purchasing (VBP). For instance, Medicare’s hospital value-based purchasing (HVBP) system increases payment rates for hospitals that demonstrate high quality. A paper by Ryan et al. (2014) explains the program in more detail. Under HVBP, acute care hospitals—those paid under Medicare’s Inpatient […]

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Was Newt Gingrich Right about Medicare?

In 1995, Newt Gingrich claimed that Medicare would end. He stated that “going to wither on the vine because we think people are voluntarily going to leave it — voluntarily.”  Was he right? In the one hand, Medicare total enrollment and spending is rising and the program still has widespread political support. On the other […]

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Do EHRs increase “upcoding”?

Upcoding occurs when physician or hospitals artificially increase the patient’s severity of illness. For instance, a hospital may record additional comorbidities. In Medicare’s inpatient prospective payment systems (IPPS), Medicare reimburses hospitals more for caring for patients who are sicker. Some health policy experts worry that electronic health records (EHRs) will decrease the cost of documenting […]

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Medicare Pricing Distortions and Patient Satisfaction

The cost of operating a physician practices differs across states.  For instance, rent is much higher in New York City than Nebraska.  Labor costs are much higher in Los Angeles than in La Crosse, Wisconsin.  To account for differences in the cost of operating a practice, Medicare adjusts reimbursement rates in their standard physician fee […]

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Inpatient Psychiatric Facilities: Patient Population and Readmissions

The Affordable Care Act has required that CMS begin to address excess readmissions in short term acute care hospitals paid under the Inpatient Prospective Payment System (IPPS) through the Hospital Readmissions Reduction program.  This program requires CMS to reduce payments to IPPS hospitals with excessive readmissions for a set of three conditions—acute myocardial infarction (AMI), […]

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Too much competition?

Rarely due consumers think that too much competition is a problem.  According to the Centers for Medicare and Medicaid Services (CMS), however, this is a major issue for consumers when they choose Part D prescription drug health plans.  Avalere reports that: Proposed revisions to the meaningful differences policy will restrict the market’s top sponsors from […]

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AMA wants more money for docs

File under “least shocking development of the day”: The American Medical Association opposes cuts to physician salaries. In a letter on Monday, the AMA stated that it expreses: …strong support for the “SGR Repeal and Medicare Provider Payment Modernization Act of 2014” (H.R. 4015/S. 2000)…Previous Congresses have spent more than $150 billion over the past […]

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History of Medicare Home Health Payments

Medicare pays home health agencies (HHAs) to care for patients who cannot care for themselves in their own homes.  HHAs, however, have experienced significant changes in the way Medicare pays them over the past 30 years.  A recent paper by Huckfeldt et al. (2014) summarizes these changes: 1983: Medicare switches to an inpatient prospective payment […]

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The End of Hospital Cost Shifting?

Medicare is cutting reimbursement to hospitals.  Austin Frakt (HSR 2013) gives some highlights findings from a CMS report: [The ACA] will permanently reduce the Medicare payments hospitals would otherwise receive. Its ‘productivity adjustment’ will scale payments downward by the average rate at which private nonfarm businesses’ productivity increases. That rate has been estimated to be […]

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Doc Fix: 2014 Edition

It’s that time of year.  The time of year where Medicare threatens to cut physician salaries by double digits (in this case 24.4%).  This is no idle threat.  Under current law, CMS is mandated to cut physician salaries under the sustainable growth rate formula.   Its the time of year that physician lobbyists (rightly) complain that […]

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