MedPAC: Long-term care hospitals, IRFs, grow under Medicare

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Long-term care hospitals and inpatient rehabilitation facilities are thriving under Medicare, the Medicare Payment Advisory Commission reported.

Program spending on LTC hospitals rose 25% annually between 2001 and 2004, reaching $3.3 billion, MedPAC reported. Also, payments per case leaped to $30,000 in 2004 from $22,000 in 2001.

The number of facilities rose from 90 in 1990 to 357 in 2004, MedPAC said. Such growth reflects high Medicare payments. Two large chains account for 40% of LTC hospitals. In addition, the number of IRFs, which provide intensive rehabilitation services, rose 100 -- to 1,227 -- from 2000 to 2004.

But the so-called "75% Rule" could hurt access to IRFs, some organizations say. The Centers for Medicaid & Medicare Services issued the rule last year, requiring IRFs have 75% of patients with one of 13 qualifying conditions to receive higher Medicare payments. The rule is likely to shift more care to skilled nursing facilities.

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