The Medicare Payment Advisory Commission (MedPAC) met on Jan. 11 and 12 to discuss and vote on recommendations for payment adequacy and updates for physician and other health professional services and hospital inpatient and outpatient services. The commission also reviewed its annual update on the status of the Medicare Advantage (MA) program.
The commissioners voted on a draft recommendation related to Medicare hospital payments that asked Congress for fiscal year 2025 to update the 2024 Medicare base payment rates for acute care hospitals by the amount specified in current law plus 1.5%. The recommendation went on to ask Congress to add $4 billion to the Medicare Safety-Net Index (MSNI) pool and begin a transition to redistribute disproportionate share hospital and uncompensated care payments through the MSNI. The recommendation asks to do this by scaling fee-for-service MSNI payments in proportion to each hospital’s MSNI and to distribute the funds through a percentage add-on to payments for the Inpatient Prospective Payments System and the Outpatient Prospective Payment System. For MA plans, the recommendation asks to pay commensurate MSNI amounts for services furnished to MA enrollees directly to hospitals and then exclude them from MA benchmarks. In the final vote for the draft recommendation, the majority of commissioners voted in support, but two abstained.
Commissioners unanimously approved a recommendation to Congress to update the 2024 Medicare base payment rate under the physician fee schedule (PFS) by the 0% increase in current law plus 50% of the projected increase in the Medicare Economic Index and establish additional payments under the PFS to support safety-net clinicians [refer to Washington Highlights, March 17, 2023]. Based on recent Medicare projections, MedPAC staff stated this would result in a 1.3% increase over current law for 2025, as well as a 5.7% increase for primary care physicians who are safety-net clinicians, and 2.5% for nonprimary care safety-net clinicians.