MedPAC Would Cut Certain Urban Standalone EDs

April 9, 2018

On April 5-6, the Medicare Payment Advisory Commission (MedPAC) held its final public meetings before releasing its June Report to the Congress.

Payments for Standalone EDs

MedPAC continued its discussion on payments to standalone emergency departments (EDs), citing concerns about the growth in ED visit volume in urban areas. The Commission voted unanimously on a recommendation to reduce ED payment rates by 30% for off-campus standalone EDs that are within six miles of an on-campus hospital ED. While the recommendation passed unanimously, some commissioners expressed an interest in potentially refining the policy after additional research. GNYHA opposes this recommendation because the policy was not empirically derived based on Medicare data, fails to consider the challenges to timely access to services in densely populated urban areas, and would exacerbate the Medicare underpayment to hospitals for providing outpatient services.

MedPAC also voted to allow isolated rural standalone EDs (more than 35 miles from another ED) to continue billing regular outpatient prospective payment system facility fees, but also receive a supplemental payment to assist with fixed costs.

Proposed Changes to Medicare Hospital Quality Initiatives

MedPAC presented additional details of its proposed Hospital Value Incentive Program (HVIP), which would merge the Hospital Readmissions Reduction Program and the Hospital Value-based Purchasing Program, and eliminate the Inpatient Quality Reporting Program and the Hospital-Acquired Condition Reduction Program. The HVIP would include four quality measures—hospital-wide readmissions, mortality, spending per beneficiary, and overall patient experience—and would set absolute prospective performance targets and adjust for social risk factors through peer grouping. The HVIP would be implemented in a budget-neutral manner. Presenters argued that the HVIP is a simpler alternative to the current overlapping and duplicative quality programs and appears to reduce the disparities in payment adjustments between providers serving populations with different social risk factors.

Policy Options to Address Low-Value Care

MedPAC also presented its analysis of Medicare coverage policy and the use of “low-value care,” which it will include in the June report. Presenters offered policy tools to help ensure Medicare dollars are spent wisely, including prior authorization for certain types of services, clinician decision support and provider education, altering beneficiary cost sharing, delivery system reform and new payment models, and linking evidence of comparative clinical effectiveness and cost effectiveness to coverage and payment.

Potential Uniform Quality Measures for Post-Acute Care

MedPAC discussed the development of uniform outcome measures for post-acute care (PAC) as it relates to the implementation of a unified PAC prospective payment system. MedPAC staff presented strategies to increase the accuracy of measures such as pooling data across years or providers, and discussed potential measures for inclusion, including discharge to community, avoidable admissions and readmissions, number of days between leaving home and returning after a hospital stay and/or PAC, patient experience, and functional status.