A majority of hospitals will see increased Medicare Part B reimbursement, despite cuts to payments under the 340B Drug Pricing Program, according to new research from Avalere Health.
For the analysis, Avalere examined CMS data on Medicare Outpatient Prospective Payment System payments for 2017 and 2018 as well as 2016 Part B drug spending. The analysis involved 3,814 hospitals paid under OPPS.
Here are six things to know.
1. CMS cut payments to hospitals under the 340B program as part of its final OPPS rule for 2018.
2. But the agency is offsetting the projected $1.6 billion drug payment cut by redistributing an equal amount for non-drug items and services within the OPPS.
3. Avalere's analysis found 85 percent of hospitals will experience an increase in Part B reimbursement in 2018 due to changes in the final OPPS rule.
4. Urban hospitals will see an average 1.4 percent increase in their Part B payments, while rural hospitals will see an average 2.7 percent increase, according to Avalere. The total projected average increase for all hospitals is 1.5 percent.
5. Avalere's analysis also found a majority (76 percent) of the 15 percent of all hospitals that will see reduced Part B reimbursement this year will experience cuts less than 5 percent of their overall outpatient reimbursement.
6. Additionally, 55 percent of total disproportionate share hospitals — which provide care to a large number of poor and uninsured patients — will experience Part B reimbursement increases that offset the 340B drug reimbursement cuts, according to Avalere.
In response to the analysis, Tom Nickels, executive vice president of the American Hospital Association, said Avalere "focuses on only selective measures to conclude that CMS' policy reduces patients’ costs, when in actuality, it has increased copayments for 97 percent of Medicare patients being treated at 340B hospitals."
Mr. Nickels added, "Avalere also fails to mention that one of the main drivers of increases in patients' costs are the skyrocketing cost of pharmaceuticals. In addition, in determining the number of hospitals that will see net payment increases, the study absurdly conflates the hospital inflation adjustment required by law with the 340B payment changes."
He went on to say the AHA will continue to challenge the Medicare payment cuts under the 340B program.
Ayla Ellison contributed to this report.
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