MedPAC to Congress: Freeze Medicare pay to facilities in '06

The Medicare Payment Advisory Commission (MedPAC) is recommending Congress freeze payments to nursing homes in 2006.

MedPAC, Congress' advisory panel on Medicare issues, this week crystallized its recently announced recommendations to Congress. It said the pay freeze would save $1 billion to $5 billion over five years, without hurting patients. The agency's recommendations are non-binding.

An independent 17-member commission that is composed of health policy experts, economists and providers of care, MedPAC also is proposing that Congress reduce the increase in Medicare payments to hospitals by four-tenths of a percentage point (to 2.8%), thus saving Medicare as much as $6 billion over five years.

Commission members said last month they were leaning toward giving hospitals a full allowance for inflation in 2006. But last week the panel changed course and recommended the smaller increase, causing howls of protests from hospital advocates this week.