Hospitals singled out to get incentives if they sign up for Medicare quality initiative

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Urban hospitals that voluntarily participate in the Centers for Medicare & Medicaid Services' quality reporting initiative will receive an average 4.7% total Medicare payment increase in 2005 under inpatient prospective payment regulations. This is significantly more than the 1.2% increase for urban hospitals in 2004. Nursing homes, the first healthcare sector to be subject to a quality initiative, receive no extra reimbursement from CMS for taking part in their quality initiative.

Rural hospitals, which were singled out for greater financial assistance, will see an average 6% total increase, compared with 5.8% in 2004.
CMS estimated that Medicare payments to 3,900 acute-care hospitals would total $105 billion in 2005, up from a projected $100 billion this year.