Medicare Looks to Cut Spending on Post-Acute Care

Researchers have discovered huge discrepancies in how much Medicare spends on nursing homes, home health services, and other post-acute services around the country.  For example, in Louisiana, Medicare spends $8,800 per patient for home health care as opposed to $3,300 per patient in New Jersey.  Because of discrepancies like these, Medicare is seeking to gain more control over what it spends on services patients receive after leaving the hospital.

Medicare spent $62 billion last year- one out of every six dollars on traditional fee-for-service programs.  Experts agree that this “hodgepodge of payment methods” encourage “unnecessary and disjointed” care which wastes taxpayer money and makes fraud easier.  They also agree that hospitals usually don’t take costs into account when discharging patients.

Medicare is now experimenting with new payment methods such as bundled payments where hospitals and post acute providers work together to treat patients for a fixed sum (rather than getting paid for each service). Also, President Obama has proposed reducing payments for certain conditions to post-acute providers and paying the same rates for similar patients. Experts warn that the transition to a new payment method will not be an easy one.

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One thought on “Medicare Looks to Cut Spending on Post-Acute Care

  1. Pingback: Monday Morning Recap | hmsabc

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