fah hospital policy blog

Perspectives on health policy affecting America’s hospitals and the patients we serve.

FAH Supports Responsible Approaches to PAC Policies

September 06, 2013 | FAH Hospital Policy Blog

Category: Medicare, Rehabilitation Care

Last week, the Federation of American Hospitals submitted comments to the leadership of the House Ways and Means Committee and its Health Subcommittee on the President’s proposed post-acute care (PAC) policies in its Fiscal Year 2014 budget.

In this letter FAH advocates for responsible approaches that not only preserve current PAC capacity, but also support continuing improvements in patient care through close collaboration between providers and lawmakers.  The core policies outlined in the FAH letter include:

No further cuts. When cuts are made to PAC providers’ already limited resources it inhibits access to PAC services at the same time as demand is increasing with an aging Medicare population. Specialized PAC providers like inpatient rehabilitation facilities (IRFs) and long-term care hospitals (LTCHs) treat patients with severe and medically complex cases whose medical and therapy care result in higher costs. Because of already existing financial pressures on PAC facilities, it is crucial that they are not further impacted by arbitrary cuts.

Right care, right place, right time. One of the goals of the FAH is ensuring patients receive the right care at the right time and in the right setting. The proposed site-neutral payment policies would significantly underestimate the differences between patient populations served in IRF and skilled nursing facilities (SNF) settings. These policies would jeopardize patients’ access to medical rehabilitation and provide a disservice to the most severely compromised patients by ignoring the differential cost structures and regulatory requirements between different types of PAC facilities.

Maintain the 60% rule. In order to be considered an IRF for Medicare reimbursement purposes, 60% of a facility’s patients must have a qualifying condition. The proposal to increase this threshold to 75% would impose further restrictions on the number and types of patients that can be admitted to IRFs.  This in turn jeopardizes patients’ access to the care they need and will instead shift patients to facilities that do not meet their needs.

Handle (bundling) with Care. If carefully planned, payment bundling could empower providers to further integrate delivery of care. However, there are significant challenges in implementation, and the bundling options have not been fully evaluated. A premature transition to bundled payments would force providers and policymakers to implement a policy without the information necessary to create a well-designed plan. FAH is grateful for the opportunity to weigh in on this critical care issue and advocate on behalf of patients and patient access to quality care.  In addition to this most recent letter, FAH has previously commented on this subject to other committees in the House and Senate. Last week FAH President and CEO Chip Kahn submitted a letter to the Senate Finance and House Ways and Means Committee Leadership and, earlier in August, The Federation of American Hospitals submitted a letter to Congressman Dave Camp.