Hospitals Brace for New Medicare Payment Rules

The Wall Street Journal—March 31, 2016

The Wall Street Journal reporter Melinda Beck covers the recently mandated bundled-payment initiative through The Centers for Medicare and Medicaid Services (CMS). According to the article, "All hospitals in 67 randomly selected metropolitan areas, including New York and Los Angeles, are required to participate. Together, they perform about one-third of the 430,000 hip and knee replacements Medicare covers annually." The mandate holds participating hospitals accountable for costs associated with hip and knee replacements for 90 days. The article explains that, "If patients recover and go home quickly, hospitals could reap savings. If they have complications or need lengthy stays in a rehab facility, hospitals could owe Medicare instead, starting next year."

Louis A. Shapiro, president and CEO of Hospital for Special Surgery (HSS) noted, "It’s very clear. If you can go home, you’re better off going home, and if you can’t go home, we can say, these skilled-nursing facilities do a good job and follow our discharge protocols." HSS has been participating in a voluntary bundled-payment program with Medicare for two years.

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