Earlier this month, CMS issued its final rule on hospital inpatient reimbursement rates for fiscal year 2013, and according to a recent Moody's Investors Service report, the net 2.8 percent increase in Medicare rates is a "credit positive" for non-profit hospitals in the short term.
CMS' proposed rule recommended a much lower increase at 0.9 percent. With the higher reimbursement rate, roughly $2 billion in extra payments will be doled out to hospitals.
However, all is not rosy for hospitals in the long term, according to Moody's. Lower Medicare payments to fund the avoidable hospital readmission program and the automatic 2 percent sequestration cuts from the failure of last year's supercommittee are still to come.
"Beyond 2013, we expect much lower annual increases, given the scope of the federal budget deficit and hardwired rate cuts included in healthcare reform," according to the report.
CMS' proposed rule recommended a much lower increase at 0.9 percent. With the higher reimbursement rate, roughly $2 billion in extra payments will be doled out to hospitals.
However, all is not rosy for hospitals in the long term, according to Moody's. Lower Medicare payments to fund the avoidable hospital readmission program and the automatic 2 percent sequestration cuts from the failure of last year's supercommittee are still to come.
"Beyond 2013, we expect much lower annual increases, given the scope of the federal budget deficit and hardwired rate cuts included in healthcare reform," according to the report.
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