New Medicare Policy May Save Money for Government But Cost Patients More

A new Medicare policy expected to save money for the federal government may end up doing so at the expense of Medicare beneficiaries who may find themselves faced with costs that Medicare previously paid.

Under the new policy, selected procedures that Medicare once authorized only when performed on an inpatient basis can now be performed on an outpatient basis.  The underlying rationale for the policy, which took effect on January 1 and will be phased in over the next three years, is that such an approach should foster competition and possibly lower Medicare costs.

But some of those procedures still require meaningful after-care that can range from prescription drugs to post-surgical monitoring to facility fees to home care and more – costs included in Medicare reimbursement for inpatient surgery but not included in the price of outpatient surgery.  Thus, while patients generally face the same maximum deductible for inpatient and outpatient procedures, they may be more likely to be forced to spend that full deductible if they choose to have the surgery performed on an outpatient basis.

This also could pose a challenge for private safety-net hospitals, which serve especially large numbers of low-income patients.  Many of those patients already have difficulty paying their Medicare co-payments, and this could leave safety-net hospitals with additional uncompensated care costs.

Learn more about how this situation came about, its implications for Medicare beneficiaries, and the possibility of this unusual situation being corrected in the Washington Post article “New cost-cutting Medicare rule may add costs to patients.”