MedPAC Unanimously Votes to Recommend Site-Neutral Payments

January 16, 2015, Tim Mullaney, McKnights - The Medicare Payment Advisory Commission has unanimously voted to recommend site-neutral payments for certain post-acute services. Skilled nursing interests have championed the policy, but opponents also have been vocal and blasted the vote that took place Thursday in Washington.

"The Congress should direct the Secretary of Health and Human Services to eliminate differences in payments between inpatient rehabilitation facilities and skilled nursing facilities for selected conditions," the draft recommendation read in part. For months, MedPAC has been discussing which conditions are the best candidates, and the panelalready has recommended certain orthopedic conditions in a report to Congress. However, at a meeting in December, commissioners agreed that providers should be able to weigh in on what other services would be affected.

The site-neutral policy likely would increase patient volume in SNFs and certainly would reduce payments to IRFs. These reductions should be phased in over three years, according to the draft recommendation. Equalizing payments would save Medicare $1 billion to $5 billion over five years, according to estimates presented at Thursday's meeting.

MedPAC does not anticipate that patients would be negatively affected because analysts have not observed significant differences in outcomes between the two provider types. However, inpatient rehabilitation facility stakeholders strenuously object to this finding.

"Seemingly ignored is research that shows patients have better survival rates and outcomes when treated in rehabilitation hospitals rather than nursing homes," stated Bruce M. Gans, M.D., chairman of the American Medical Rehabilitation Providers Association. "In fact, not only do patients live longer, they go home sooner and have fewer hospital readmissions."

Gans was referring to the results of a study commissioned by AMRPA and conducted by Dobson DeVanzo & Associates.

The Coalition to Preserve Rehabilitation — an alliance of consumer, disability and clinician organizations — called MedPAC's decision an "overreach." The commission failed to consider the effects of comorbidities and complications when it was reviewing 22 possible conditions for inclusion, and so failed to understand how amputees and other patients with complex needs could suffer from being "diverted" to SNFs rather than inpatient rehab, stated coalition member Sue Stout, executive director of the Amputee Coalition.

The vote means that MedPAC now will formally recommend this policy to Congress, but lawmakers are not obligated to take action.