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Medicare 360: 2018 Medicare Reimbursement Report A Market-By-Market Analysis

Medicare 360: 2018 Medicare Reimbursement Report A Market-By-Market Analysis

Although the majority of healthcare providers will receive small payment increases from Medicare in 2018, theycontinue to face an uncertain reimbursement future. The Centers for Medicare & Medicaid Services (CMS) isaccelerating efforts to tie Medicare payment to quality and outcomes across all provider settings, which will leadto continued shifts in payment models. Specific provider segments including labs and physicians have even moreuncertainty as congressionally-mandated payment changes have started to be implemented.

CMS has finalized payment updates to all markets, and the changes between final and proposed rules indicate adesire to alleviate administrative burdens and lower costs. However, not everyone is satisfied with the outcomes aseach market has its own unique challenges. For instance, CMS’s changes to the clinical laboratory fee schedule wouldsave the government payer around $670 million, despite vocal concern from the lab industry that the agency is usingincomplete data.

Key payment changes for 2018 include:
• IPPS: Revised Hospital Readmission Reduction Program to include the number of dual eligibles as well
as comparing hospitals within their own cohort
• SNF: Formalized policies for the first year of the value-based purchasing program
• OPPS: Will see an overall impact of 1.4% payment increase for providers except for services that are also
performed in a physician office, which will be cut significantly
• Labs: 75% of codes will receive negative payment adjustment – with 58% receiving the maximum cut of
10% – while 10% of codes will see a payment increase
• ASC: Payments are projected to increase approximately 3% (MRP-adjusted CPI-U update factor of 1.2%)
• Home Health Agencies: Will receive a -0.4% payment reduction totalling around $80 million
• Physician: Medicare reimbursement is slated for a +0.41% update

While policymakers continue to push initiatives that hold providers accountable on quality and cost, the tumultuouseffort to “repeal and replace” the Affordable Care Act (ACA) further indicated a clear desire by the new Republicanadministration and Congress to move away from a healthcare status quo, and institute wholesale changes. Afterinitially failing, the House did pass a plan to repeal the ACA. However, the Senate was not able to pass similarlegislation despite repeated attempts and various versions.This prompted President Trump to sign an executive orderthat expanded access to more loosely regulated health plans among other contentious provisions. With otherlegislative priorities pressing, Congress chose to put their health reform efforts on hold for 2017, but may look toresume them in 2018. Regardless, cost and quality initiatives are very bipartisan concepts and will remain in someform, irrespective of how Congress chooses to handle any future ACA repeal efforts.

The HIDA Government Affairs Medicare360 Report, published annually, outlines these key trends and issues. Thisreport provides a policy outlook for all markets as well as detailed analyses of reimbursement and quality programs.


Market by Market – What Lies Ahead
THE ACUTE CARE MARKET
2018 Policy Outlook & Analysis
Hospital Inpatient Quality Reporting
Hospital Outpatient Quality Reporting
Ambulatory Surgical Centers Quality Reporting
THE PHYSICIAN MARKET
2018 Policy Outlook & Analysis
Physician Quality Reporting
THE LABORATORY MARKET
2018 Policy Outlook & Analysis
THE POST ACUTE MARKET
2018 Policy Outlook & Analysis
Nursing Home Quality Reporting Initiative
Home Health Agencies Quality Reporting Initiative
Quality Reporting Initiative: Hospice
APPENDIX
Reimbursement Changes by Market – Final Rule Summaries
Hospital Inpatient
Hospital Outpatient and Ambulatory Surgery Centers
Physician
Skilled Nursing Facility
Home Health Agencies
IRF and Hospice
Glossary of Key Healthcare Terms
Glossary of Key Healthcare Acronyms

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