Vituity

News Updates — Medicare Regulations and Reimbursements

Our biweekly news updates are designed to keep you up to date with current developments relating to the Acute Care Continuum. Feel free to share your perspective on these stories or link to articles that you have found relevant to today's healthcare environment.

Readmission Penalties Will Increase for Hospitals

As hospital administrators focus on reducing readmissions, Centers for Medicare & Medicaid Services (CMS) has announced that penalties for high readmission rates will increase starting October 1, 2013. For the last year, penalties have been capped at 1 percent of a hospital's Medicare reimbursement, but that number will climb to 2 percent later this year. Under federal law, the penalties will "top out at 3 percent beginning in October 2014." CMS expects to cut spending by $227 million over the next year thanks to the readmission penalties. Although readmission rates have slowed over the last year, many believe it is due to the use of Observation Units to divert short-stay patients rather than an overall improvement in care.

HHS Urges Medicare to Refine Observation Unit Policies and Rules

As observation units have become more prevalent, a chief complaint among patients and providers has been that admittance to an observation unit does not count "toward the three-inpatient-day minimum required for nursing home coverage." Now the Department of Health and Human Services (HHS) is urging CMS to change those requirements. Without an inpatient stay, Medicare does not cover follow-up visits to a nursing home, leaving patients on the hook for thousands of dollars in medical bills if they are admitted to a nursing home after being treated in an observation unit.

AHA Calling on CMS to Delay Meaningful Use Regulations

"The American Hospital Association (AHA) is continuing its call to delay the Oct. 1 deadline for Meaningful Use Stage 2 because of widespread complaints that electronic health records (EHR) cannot accurately process federally mandated quality measures." The AHA has again raised concerns that hospitals will be unable to meet Meaningful Use requirements due to inadequate data collection, poorly constructed federal policies and insufficient resources. AHA is asking CMS to slow down the timeline and reduce the number of Meaningful Use requirements.