MedPAC calls for modest 1% hospital pay bump

The Medicare Payment Advisory Commission (MedPAC) has proposed increasing hospital payments a mere 1 percent during fiscal 2014, according to the December 2012 report.

The commission cited a variety of factors behind its decision. Among them, hospital spending barely budged in 2011. Inpatient spending was down 1 percent, while outpatient spending was up 9 percent, and overall spending was up only 2 percent.

MedPAC also concluded that access to capital was steady, while interest rates were low, according to the report

In terms of the quality of care delivered, 30-day post discharge mortality measures improved, as did patient satisfaction and readmission rates, MedPAC noted.

As a result of aggregating all that information, the commission did not see a reason for a significant payment increase.

A final decision will be made by MedPAC in January, but could be revised prior to its vote.

The proposed rate increased was criticized by providers, most notably the American Hospital Association, according to AHA News Now.

"There are real increases in patient severity linked to trends in obesity, growing shares of patients with multiple chronic diseases, and more patients dually eligible for Medicare and Medicaid," Caroline Steinberg, AHA's vice president of trends analysis, told AHA News Now.

"These trends need to be recognized in reimbursements. Plain and simple:  Today's hospital patients are sicker," she said.

For more:
- here's the MedPAC report (.pdf)
- read the AHA News Now brief