Massachusetts hospitals to lose $84M due to Partners' math errors

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Math errors related to wages at 19-bed Nantucket (Mass.) Cottage Hospital, owned by Boston-based Partners HealthCare, will likely cause hospitals across Massachusetts to lose nearly $84 million, according to the Boston Business Journal.

In 2015, consultants hired by Partners made several errors in the data Nantucket Cottage Hospital submitted to Medicare. Specifically, the hospital provided data to CMS that underestimated its wages.

Under hospital payment rules, Medicare is required to reimburse employee wages at urban hospitals at the baseline set at rural hospitals in the state. Nantucket Cottage Hospital typically sets the floor for wages at hospitals across Massachusetts because it is the only rural hospital in the state. Last year, when the hospital provided data that underestimated its wages, it dragged down payments for hospitals across the state.

Partners identified the errors in mid- to late March, and sent corrected numbers to CMS April 5, almost two months after the deadline for submitting corrections.

In its inpatient prospective payment systems rule for 2017, CMS said it will not allow Partners to resubmit the paperwork.

"We have consistently stated in annual IPPS rulemaking that hospitals that do not meet the procedural deadlines set forth in the IPPS rule will not be afforded a later opportunity to submit wage index data corrections or to dispute the Medicare administrative contractor's decision with respect to requested changes," wrote CMS in the rule. "Therefore, we are not incorporating the adjustments requested by Nantucket Cottage Hospital for the FY 2017 final rule wage index."

Massachusetts officials initially estimated hospitals would lose as much as $160 million due to the mistakes. 

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