Hospitals Notch Several Wins Under New Federal Funding Law

February 09, 2018

About a dozen expired Medicare payment provisions—many of which benefit Wisconsin hospitals operating in rural parts of the state—have been extended over the next several years under broad legislation passed by Congress and signed into law February 9.

The legislative package, which also boosts domestic and defense spending, includes scores of provisions impacting how hospitals and providers are paid under Medicare, Medicaid and CHIP. Most of the measures will return—and in some cases boost—hospital reimbursement. And several more provisions are seen as mostly provider friendly.

At the outset, the package includes the so-called “Medicare Extenders,” including:

  • Extension of Geographic Practice Cost Index: Two-year extension, through Dec. 31, 2019, boosting physician payment in rural communities;
  • Permanent repeal of the Medicare therapy caps: The provision gets rid of the annual payment limits for certain therapies, such as physician and speech services;
  • Extension of increased inpatient payment for low-volume adjustment: Higher payments included for five years;
  • Extension of Medicare Dependent Hospitals: Higher payments extended for five years; and,
  • Extension of home health rural add on: Boosts payments for home health services provided in rural areas.

The package also includes an extra four-year extension of the Children’s Health Insurance Program (CHIP), bringing it up to a total of 10-years and providing stability for hospitals that treat lower-income families.

CHIP aside, hospitals should also benefit from a continued delay of the scheduled Medicaid Disproportionate Share Hospital (DSH) payment cuts. The legislation puts a stay on the $5 billion in reductions scheduled for fiscal years 2018 and 2019.

Other provisions are designed to ease the path for Accountable Care Organizations as the advance through new payment models, and increase the availability and payments around telehealth services.

Broadly, the package is seen as an overall win for Wisconsin hospitals and others across the United States. Hospital groups worked hard to get the expired Medicare extenders re-upped, and pushed federal lawmakers to delay the cuts under the DSH program.

This story originally appeared in the February 09, 2018 edition of WHA Newsletter