Medicare Payment Rates to Providers Could be Reduced by 27.4 Percent in 2012

Monday, November 7th, 2011
This post was written by Cheryl Miller

CMS has released a proposed final rule on the 2012 Medicare Physician Fee Schedule that puts provider payment cuts of 27.4 percent on the table for January 1, 2012. The reduction, based on the Sustainable Growth Rate (SGR) formula, reflects the fact that Medicare costs grew more slowly than expected, according to CMS. But many agencies, including CMS and the AMA, are voicing concerns that such a cut, or even a reduced one, will jeopardize access to care for seniors and pose financial burdens for physicians. They are calling on Congress to intervene. If it does, it wouldn’t be the first time; in fact, it would be the 11th time that Congress did so. Since 2002, the SGR has triggered annual pay cuts for physicians; starting in 2003, each one has been postponed by an act of Congress. We will keep you posted on this story.

One way to offset Medicare costs in the coming year is to utilize more case managers, says Steven Valentine, president of The Camden Group in our recent webinar: Healthcare Trends in 2012: A Strategic Industry Forecast. Embedding them in the physician practice and the emergency department will help to ease the increasing burden on physicians. Another way to further reduce costs and improve care would be to implement mini-medical homes, particularly for the chronically ill.

Our eighth annual healthcare trends event provides a first look analysis at the key trends and opportunities for healthcare organizations in the coming year. If you missed it, it is now available on demand here. With unprecedented economic conditions continuing to impact the industry, Valentine discusses new payment and delivery options available for healthcare providers and the ongoing implementation of the Patient Protection and Affordable Care Act.

In other news, hospital supply cart drawer handles, floors, infusion pumps, ventilator touch pads and bed rails were the surfaces most commonly contaminated in a recent study of how frequently patients’ environments become contaminated. The study also found that nearly half of the hospital rooms of patients who tested positive for a multi-drug resistant bacteria were contaminated with the bacteria. More details in this issue.

And finally, an alarming statistic: more than 40 people die every day from overdoses involving narcotic pain relievers, a number that has more than tripled in the past decade, according to the CDC. In 2010, 1 in every 20 people in the United States age 12 and older — a total of 12 million people — reported using prescription painkillers non-medically. Sales of these drugs to pharmacies and healthcare providers have increased by more than 300 percent since 1999. In this story, the CDC proposes six ways states can help reverse this trend.

These stories and more in this week’s issue of the Healthcare Business Weekly Update.

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