Noteworthy News

Senate May Tackle Socio-economic Risk Adjustment

With a House bill to adjust Medicare payment penalties based upon the socio-economic challenges posed by the patients some hospitals serve folded into a House bill that passed in June, the Senate may take up this issue during its fall session.

Health economists, policy experts, and providers generally agree that the performance of hospitals that serve especially large numbers of low-income patients is affected in a number of areas, including Medicare readmissions, meeting value-based purchasing criteria, and others.

And while the Centers for Medicare & Medicaid Services acknowledges the challenge, the agency has rejected calls for risk adjustment so far, repeatedly writing that it does not “want to mask potential disparities or minimize incentives to improve the outcomes of disadvantaged populations.”

HospitalMeanwhile, a growing body of research has documented that the anticipated impact of serving socioeconomically challenged patients is real and more and more people are joining the call for Congress or CMS to address the problem.

Compounding the challenge is that hospitals that serve such patients are faced with growing financial penalties from Medicare if they fail to perform at levels comparable to hospitals that face fewer challenges.

NAUH has long argued that Medicare’s quality-related programs need appropriate risk adjustment and support H.R. 1343, the Establishing Beneficiary Equity in the Hospital Readmissions Program Act, which was folded into other House legislation in June, and S. 688, a bill of the same name in the Senate. Go here to see NAUH’s letter conveying its support for this legislation.

For a closer look at the issue, the arguments on both sides, and the prospects for congressional action this fall, see this article from CQ Roll Call presented by the Commonwealth Fund.

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