Partners tries to rectify math errors that would cost Massachusetts hospitals $160M

To prevent steep declines in Medicare payments to Massachusetts hospitals, Partners HealthCare is urging CMS to use corrected data the Boston-based system submitted for 19-bed Nantucket (Mass.) Cottage Hospital.

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. However, that isn't the case this year.

Consultants hired by Partners made several errors in the data Nantucket Cottage Hospital submitted to Medicare. The errors reduced the hourly wage rate by overestimating hours and failing to include enough overtime pay and high-paid physician hours. Due to the mistakes, Massachusetts hospitals could lose a total of $160 million in Medicare funding next year.  

Tim Gens, executive vice president and general counsel at the Massachusetts Hospital Association, told The Republican that the potential funding reductions are "dire." Partners' reimbursement would drop by $18 million, while Springfield, Mass.-based Baystate Health and Burlington, Mass.-based Lahey Health stand to lose $35 million and $25 million, respectively.

Partners submitted the incorrect data to Medicare in September. The system identified the errors in mid- to late March, and sent corrected numbers April 5, almost two months after the deadline for submitting corrections.

Partners spokesman Rich Copp told The Republican that the system is working with the Massachusetts Hospital Association and the entire congressional delegation in an effort to have CMS use the corrected wage data.

In a May 25 meeting hosted by U.S Rep. Richard Neal (D-Mass.), the Massachusetts congressional delegation discussed the issue with CMS. State representatives believe the federal government has the authority to use the corrected data. Earlier this year, Rep. Michael Capuano (D-Mass.) told the Boston Globe that Medicare has allowed other states to amend data after the correction deadline, and he believes it should give Massachusetts the same opportunity.

Although Mr. Gens from the MHA declined to provide The Republican with estimates for numbers of potential job losses, saying there are too many variables to make an accurate prediction, an analysis from the Massachusetts Council of Community Hospitals estimates the payment reductions could force up to 2,100 layoffs combined at hospitals across the state.

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