MedPAC releases 2019 payment updates

The Medicare Payment Advisory Commission (MedPAC) has released draft recommendations on Medicare fee-for-service payment and policy changes, as required by law. These recommendations, directed at Congress and the Department of Health and Human Services Secretary, are for calendar and federal fiscal year 2019. MedPAC will meet in January to vote on its recommendations. Final recommendations will be published in its March 2018 report to Congress.

MedPAC’s specific draft recommendations include:

  • Hospital inpatient and outpatient payments – MedPAC states that for acute care hospitals, overall Medicare margins in 2016 were negative 9.6 percent (South Dakota overall Medicare margins in 2015 were -3.10 percent). MedPAC projects that margin to decrease further, to negative 11 percent, in 2018. Notably, even the “efficient providers” that MedPAC tracks had a negative 1 percent Medicare margin. MedPAC recommends that Congress retain the inpatient and outpatient update amounts specified in current law. MedPAC estimates that update will be approximately 1.25 percent for FFY 2019.
  • Post-acute care – in an effort to speed adoption of a unified post-acute care payment system, MedPAC directs the Health and Human Services Secretary to begin to base Medicare payments to skilled-nursing facilities, inpatient rehabilitation facilities, long-term acute care hospitals and home health agencies on a blend of the current setting-specific relative weights for each payment system and a new unified post-acute care prospective payment system beginning in 2019. MedPAC has previously recommended that Congress adopt a unified post-acute care prospective payment system by no later than 2021.

The presentations made by MedPAC staff at the December meeting, along with the meeting transcript, are available on the MedPAC website.