MedPAC tells Congress to hasten post-acute pay overhaul

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The Medicare Payment Advisory Committee has submitted its June 2017 report to Congress, and with it request that lawmakers implement a unified post-acute care payment system beginning in 2021 — earlier than previously proposed.

The Improving Medicare Post-Acute Care Transformation Act of 2014 outlined a timeline where a proposal for a new payment system would likely not be proposed before 2024, with implementation coming after that, MedPAC said.

The group's report, issued Thursday, recommends that the Centers for Medicare & Medicaid Services begin implementation of the new unified system in 2021, followed by a three-year transition period. The switch is crucial, MedPAC said, since its research found that Medicare payments overshoot providers' costs by 14% across PAC settings.

The June report also recommends that payments be lowered by 5% “to more closely align payments with the cost of care,” and have setting-specific regulations aligned to allow all providers to “compete on a level playing field.”

MedPAC also suggested allowing providers the option to bypass the transition period and be paid full payments.

“While this option would raise program spending during the transition, it would more quickly base payments on patient characteristics and make them more equitable,” MedPAC said.

The group's full June report to Congress also includes recommendations on long-stay nursing home residents' hospital use, Medicare Part B drug payment policy issues, and the relationship between physicians and other Medicare services.