Also In The Inpatient Comments...
This article was originally published in The Gray Sheet
Executive Summary
Capital payments: In fiscal year 2008, CMS decided to discontinue a 3% add-on payment for hospitals in large urban areas, and phase out the capital adjustment for indirect medical education (IME) over three years ("The Gray Sheet" Aug. 6, 2007, p. 7). The American Hospital Association (AHA) says in June 9 comments that the reductions - which it estimates at close to $2 billion over five years - will make it more difficult for hospitals to buy advanced technology and equipment and invest in health IT. AdvaMed notes that the cuts have a "disproportionate impact" on teaching hospitals, which it says play "a critical role in the development and dissemination of medical innovations." AdvaMed asks CMS to defer additional reductions, while making any changes budget neutral and returning the funds to all hospitals as a group. The Medicare Payment Advisory Commission (MedPAC), meanwhile, recommends a greater reduction to IME payments.