Markets function best when competitors play by the same rules. Medicare’s payment system should do the same.
One of Medicare’s most puzzling rules has nothing to do with the care patients receive. For many routine outpatient services, it pays substantially more when care is delivered in a hospital-owned facility than when the exact same service is performed in an independent physician’s office or ambulatory surgery center.
This payment gap has driven up costs, furnished hospitals with extra cash they’ve used to consolidate local healthcare markets, and left taxpayers footing the bill.
Slowly but surely, the Trump administration is changing that. Earlier this month, the Centers for Medicare and Medicaid Services proposed reducing Medicare’s payment disparities for outpatient imaging services. Medicare estimates that these changes would reduce Medicare spending by roughly $260 million in 2027 and beneficiary cost-sharing by about $70 million.
Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.
Medicare Takes A Smart Step Toward Site-Neutral Payments
Sally C. Pipes
Markets function best when competitors play by the same rules. Medicare’s payment system should do the same.
One of Medicare’s most puzzling rules has nothing to do with the care patients receive. For many routine outpatient services, it pays substantially more when care is delivered in a hospital-owned facility than when the exact same service is performed in an independent physician’s office or ambulatory surgery center.
This payment gap has driven up costs, furnished hospitals with extra cash they’ve used to consolidate local healthcare markets, and left taxpayers footing the bill.
Slowly but surely, the Trump administration is changing that. Earlier this month, the Centers for Medicare and Medicaid Services proposed reducing Medicare’s payment disparities for outpatient imaging services. Medicare estimates that these changes would reduce Medicare spending by roughly $260 million in 2027 and beneficiary cost-sharing by about $70 million.
Read the op-ed in Forbes.
Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.