Hospitals urge MedPac to reject site-neutral payments, wage index proposals

The American Hospital Association continues to oppose site-neutral pay cuts to hospital outpatient departments, which it argues need "stable and adequate government reimbursements" to ensure access to care in a challenging financial period. 

"For many hospitals and health systems, continued financial viability is becoming increasingly difficult as they manage the aftermath of the most significant public health crisis in a century, as well as the incredible challenges of deepening workforce shortages, broken supply chains and historic levels of inflation that have increased the costs of caring for patients," AHA said in an April 4 letter in response to the Medicare Payment Advisory Commission's annual March report to Congress.

The association argues that, among other things, site-neutral pay cuts would reduce access to key healthcare services — particularly in rural and underserved communities — and endanger hospitals' ability to provide 24/7 access to emergency care.

The AHA also pushed MedPAC to maintain the average-sales-price-plus-6 percent payment methodology for Medicare Part B drugs and raised concerns about a proposed alternative to Medicare's wage index system, particularly when considering the margin pressures hospitals continue to face on the back of their worst financial year since the pandemic.

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