Hospital groups push back against pending Medicare cuts

Three hospital associations on Tuesday urged the agency that oversees Medicare to nix a proposed 2.9 percent cut in hospital payments for Fiscal Year 2011. The groups — the Federation of American Hospitals, the American Hospital Association and the Association of American Medical Colleges — released new studies suggesting the cuts are based on the inaccurate premise that hospitals have been getting higher payments in recent years only because of a change in how patients are classified.

The studies "highlight significant concerns with (the Centers for Medicare and Medicaid Services's) approach to documentation and coding change," the groups write in a letter sent Tuesday to CMS Administrator Donald Berwick.

"We bring these independent studies to your attention ahead of publication of the final rule and urge you to change the agency’s methodology for determining documentation and coding change to better account for increasing patient severity, as documented by historical trends and reduce the proposed cut to inpatient PPS payments for FY 2011."

The studies, by the Moran Company and City University of New York Economics Professor Partha Deb, conclude the increases are linked in part to the Medicare population getting sicker.

CMS recommended the cuts, worth $3.7 billion, in proposed regulations earlier this year. Final regulations are pending.