Efficiency pressure on hospitals linked with Medicare cost hikes

Hospitals pressured by private payers to operate more cost-effectively may shift costs to Medicare, according to an Anesthesia Staffing Solutions blog post. Hospitals posting high profits on other lines of business face relatively little pressure to curb costs, the Medicare Payment Advisory Commission told Congress; but hospitals generating less gain on non-Medicare services may face losses and possible closure if they don't tighten their belts and make money on services to Medicare patients. Hospitals under the most financial pressure had a median overall Medicare profit margin of 2 percent, which is 7 percentage points above the national median, MedPAC noted. In contrast, hospitals with low levels of pressure had a median Medicare profit margin of -10 percent, which is 4 percentage points below the national median. Article