CBO: market-basket freeze for skilled nursing could add up to billions in savings

Share this content:
The federal government can expect to save roughly $26 billion in Medicare costs over 10 years in part by freezing the market-basket update for skilled nursing facilities in fiscal year 2010, according to a new analysis from the Congressional Budget Office.

The CBO report, which was released Wednesday, details some of the cost-saving measures proposed in the current draft of House healthcare reform legislation. The proposal to freeze the market-basket update for SNFs in the second, third and fourth quarters of FY 2010 and incorporate productivity improvements into future market-basket updates could result in $26 billion in savings from the SNFs, the CBO concluded. An additional $5 billion would be saved through similar reforms to inpatient rehabilitation facilities.

Besides the market-basket freeze, the current form of the House legislation also includes a physician payment fix, a plan to close the Medicare Part D prescription drug coverage gap, improved Medicare access for low-income beneficiaries and preventive health measures. All told, the CBO calculates $155 billion in Medicare savings over the next 10 years should these proposals take effect.