Hospitals Would Take Hit As Part Of Health Budget Proposals
26 Febbraio 2009 - 4:54PM
Dow Jones News
A budget framework proposed by the White House would clamp down
on Medicare payments to hospitals as part of efforts to fund new
health reform initiatives.
Budget documents released by the White House on Thursday said
that readmission rates for Medicare patients were too high. The
budget proposal states that the federal government should seek to
lower readmission rates, and payments to hospitals that readmit too
many Medicare patients.
A Commonwealth Fund study found that 18% of Medicare patients
admitted to a hospital in 2005 were rehospitalized within 30 days.
The budget proposal seeks to stem readmissions by bundling payments
for hospitalizations and post-acute care, which would purportedly
have the effect of deterring a cycle of releasing Medicare patients
only to quickly readmit them.
"Sometimes the readmission could not have been prevented, but
many of these readmissions are avoidable," the document said.
Efforts to keep hospitals from readmitting patients and the new
bundling policy would save $26.3 billion from 2010 to 2019,
according to the White House. Savings from the readmission
proposal, one of several attempts in the proposed budget to use
Medicare as a vehicle for broad changes in the health sector, would
funnel to a $633.8 billion "reserve fund" for health reform.
The budget proposal also seeks savings through greater use of
"pay for performance" for Medicare payment for acute inpatient
hospital services. The proposal states that Medicare would impose
new measures that would allocate payments based on quality of care
given to patients, rather than quantity of services provided by
hospitals. That measure is slated to save $12.1 billion over the
10-year period.
The main publicly traded hospital companies include Tenet
Healthcare Corp. (THC), Health Management Associates Inc. (HMA),
LifePoint Hospitals Inc. (LPNT), Universal Health Services Inc.
(UHS) and Community Health Systems Inc. (CYH).
Hospitals are not the only part of the health sector that would
feel pain in the budget proposal. Another provision would put in
place vast reductions in payments to private insurers through the
Medicare Advantage program, creating a competitive bidding system
to make Medicare Advantage payments more comparable to payments
through the government's traditional Medicare fee-for-service
program. That provision is slated to save $175 billion over 10
years.
Another provision would increase the rebate on sales to Medicaid
patients paid by drug makers to the federal government from 15.1%
to 22.1%. That measure, combined with another proposal that would
apply the rebate policy to new formulations of existing drugs,
would save $19.6 billion over 10 years.
-By Patrick Yoest, Dow Jones Newswires; 202-862-3554;
patrick.yoest@dowjones.com
(Dinah Wisenberg Brin contributed to this report.)