MEDICARE MONITOR
What Entitlement Reform Might Mean for ASCs Medicare reform seems likely, but the form it will take is anything but certain. What do some of the leading ideas about how to fix Medicare mean for ASCs? BY JONATHAN BEAL
A
s the debate over how to address US budgetary concerns contin-
ues, many policy makers are exam- ining ways to decrease the costs of Medicare. What effect would Medicare reform
have on ASCs? That answer depends on what shape the reform takes. There are many competing ideas on how best to reduce what the Medicare program spends while continuing to provide se- niors with a high level of care. One potential strategy to reduce Medicare expenditures is to limit what the program pays either by raising the eligibility age or by paying future Medi- care beneficiaries a defined amount that could be used to purchase coverage in the private market. This is the approach championed by former vice presidential candidate Paul Ryan as well as others across the political aisle. The effect of reducing Medicare
expenditures in either of these ways would be to shift more patients to the private market. This means that ASCs and other providers would see an in- crease in the percent of their volume paid for by other payers. Curtailing benefits, however, is unpopular with Medicare beneficiaries and, conse- quently, few members of Congress are interested in championing the idea. Another strategy to reduce Medi-
care expenditures is to require cuts in rates or services if expenditures rise above a certain level. The Sustainable Growth Rate (SGR) and the Indepen- dent Payment Advisory Board (IPAB) are examples of this strategy. The SGR is a congressionally mandated formula that results in automatic cuts to physi- cian rates if expenditures rise above a certain level. The IPAB is a group cre- ated by the Affordable Care Act (ACA) that is tasked with recommending cuts
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in services if Medicare expenditures exceed certain thresholds.
The political feasibility of this ap-
proach seems questionable. Congress has repeatedly taken steps to postpone the cuts to physician rates that were scheduled to occur based on the SGR formula, and the IPAB faces grow- ing opposition. The potential for cuts in rates or covered services, however, means that ASCs must be ready to make the argument that they must be paid ad- equately to remain a viable choice for low cost care and that the services they provide are necessary for the long-term health of Medicare beneficiaries. A third way to save money that has caught the attention of policy makers is to focus on preventive care. The idea is that diagnosing and treating diseases early is less costly than treating them after they
have become more serious. For ex- ample, the ACA eliminates patient cost sharing for certain preventive services such as mammograms and colonoscopies. As more patients are encouraged to obtain colonoscopies, ASCs that provide the service could stand to benefit. Another way for the Medicare system to save money is to reduce er- roneous payments due to mistake or fraud. While cracking down on erro- neous payments is likely insufficient to solve the problem of skyrocketing Medicare spending, it is a politically feasible strategy because it is some- thing that everyone can get behind. ASCs and other providers have al- ready seen the effects of increased oversight in the form of Recovery Audit Contractors and should expect greater scrutiny in the future.
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