Skip to Content

Filter by:

Washington Highlights

AAMC Urges CMS Not to Implement Policy Changes that Reduce IME Payments, to Consider SES Factors in Determining Readmissions

June 29, 2012—In its June 25 comment letter on the Medicare fiscal year (FY) 2013 hospital inpatient proposed rule, the AAMC urged the Centers for Medicare and Medicaid Services (CMS) not to implement a proposed policy change with respect to how labor and delivery (L&D) beds are counted that would decrease indirect medical education (IME) payments to teaching hospitals.  The AAMC emphasized that CMS’s proposed policy to include L&D bed days for IME and Disproportionate Share Hospital (DSH) payment purposes is inconsistent with longstanding CMS policy regarding services that typically are not covered by the Medicare program.  

The AAMC submitted comments in response to CMS’s readmissions payment reduction program, which will reduce Medicare payments to hospitals with high readmission rates starting in Oct. 2012.  The AAMC cited an analysis that the association performed with KNG Health Consulting to show how current readmissions measures do not properly account for social economic status (SES) variables.

In its analysis, the AAMC conducted a patient-level stratification of hospital readmissions according to dual-eligible status, which was used as a proxy for SES. Hospitals with a higher proportion of dual-eligibles are the most at risk for receiving the maximum payment reduction under the readmissions program. The association also conducted a hospital-level analysis of readmissions based on DSH patient percentage (DPP), which showed the same result: high DPP hospitals will be disproportionately affected by the program as currently structured. In its comments, the AAMC urged CMS to include a readmissions stratification that incorporates dual-eligible status or an adjustment for high performing DPP hospitals.   

The AAMC also submitted comments on the inpatient quality reporting (IQR), value-based purchasing (VBP), and the hospital-acquired condition (HAC) programs. The association strongly supports CMS’s proposal to remove 17 quality measures from the IQR program. Regarding the VBP program, the AAMC expressed concerns with the proposed inclusion of the Medicare spending per beneficiary, CLABSI, and AHRQ PSI measures, along with CMS’s proposed methodology for weighting these measures. 

With respect to proposals affecting graduate medical education (GME) policies, the AAMC applauded CMS for the agency’s proposal to increase to increase the amount of time from 3 years to 5 years that new teaching hospitals may have to build their residency training programs before CMS establishes their residency caps.  Rather than applying this policy only to hospitals that begin training residents for the first time on or after Oct. 1, 2012, however, the AAMC encouraged CMS to apply the new policy to all hospitals that are currently in their cap-building period as of Oct. 1, 2012. 

In response to proposals related to unused resident slots redistributed under Section 5503 of the Affordable Care Act (ACA, P.L. 111-148 and P.L. 111-152), the AAMC strongly urged CMS not to implement proposals that would require awardees to use half of their awarded slots in three years and all of their awarded slots in the fifth year after the date of the award announcement or risk losing all of their awarded slots.  The AAMC emphasized that given the late timing of CMS’s announcement of these new requirements, the fact that hospitals starting new programs often phase in those new programs over a period of years, and the lengthy accreditation and site visit processes new programs must go through, the timeframes CMS proposed will be impossible for many awardees to meet. 

The AAMC also responded to several proposals related to the Section 5506 closed hospital slot redistribution program and encouraged CMS not to terminate the agency’s current temporary slot redistribution program for displaced resident trainees.

In other areas, the AAMC urged CMS to reduce proposed “documentation and coding” reductions relating to CMS analyses that show increased payments due to coding changes that occurred when CMS moved from diagnosis-related groups (DRGs) to Medicare-severity DRGs in 2009.  The AAMC’s comment letter identifies flaws in the CMS methodology and encourages CMS to reduce the size of the cuts accordingly.


Jennifer Faerberg, MHSA
Director, Clinical Transformation Unit
Telephone: 202-862-6221


envelope on a green background

Subscribe to Washington Highlights

RSS icon

Subscribe to RSS

Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

Past Issues

For More Information

Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806