Partners boo-boo could cost Massachusetts $160M in Medicare payments

Calculation errors regarding the wages paid by a tiny 19-bed hospital in Massachusetts could wind up having an outsized impact on the Medicare payments given to the other acute care providers statewide, The Boston Globe reported.

That's because 19-bed Nantucket Cottage Hospital, owned by Partners HealthCare, is the state's only rural hospital. As a result, under Medicare rules, it essentially sets a floor for the wage reimbursement for the rest of the Bay State's hospitals, which must receive at least as much reimbursement as rural facilities do.

But consultants hired by Partners underreported the wages paid to Nantucket Cottage employees, and did not report enough of the higher wages and overtime paid to physicians, according to the Globe. And the deadline to submit corrections to the Centers for Medicare & Medicaid Services (CMS) has passed.

As a result, the newspaper reported, the state's hospitals could see Medicare payments in the coming year drop by as much as $160 million when the new fiscal year begins this autumn. The Massachusetts Council of Community Hospitals estimates that hospitals may have to cut as many as 2,000 jobs as a result of the funding shortfall.

The issue tends again to underline the enormous influence Partners wields in Massachusetts. It controls so much of the hospital market in the state that other providers have demanded say on future deals involving the hospital system. In 2014, the state's attorney general reached a deal with Partners regarding its ability to set prices for services and engage in future provider acquisitions.

The CMS is being lobbied to acknowledge the errors and fix the potential payment shortfalls. Steven Walsh, executive director of the Massachusetts Council of Community Hospitals, told the newspaper that the agency has "broad discretion to correct the error. It would be really unfortunate and unacceptable to risk losing millions of dollars and thousands of jobs over a math error."

To learn more:
- read The Boston Globe article

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