The federal agency that advises Congress on Medicare payment issues has submitted to Congress its annual recommendations for changes in how Medicare pays providers for the services they deliver to the nation’s seniors.

medpagAmong the recommendations offered by the Medicare Payment Advisory Commission (MedPAC) for FY 2016 are:

  • The reduction or elimination of differences in rates between physician offices and hospital outpatient departments for selected services.
  • A new prospective per beneficiary payment to replace the Primary Care Incentive Payment that expires at the end of 2015.
  • The repeal and replacement of the sustainable growth rate formula (SGR).
  • An increase in the degree to which accountable care organizations (ACOs) may share in the savings they generate.
  • The elimination of differences in payments between skilled nursing facilities and inpatient rehabilitation facilities for selected conditions, to be phased in over three years.

MedPAC also offered specific recommendations on rates, including:

  • A 3.25 percent increase in inpatient and outpatient rates.
  • No updates for ambulatory surgical centers, outpatient dialysis, skilled nursing facilities, inpatient rehabilitation facilities, long-term-care hospitals, home health agencies, and hospices.
  • Rebasing the payment system for skilled nursing facilities, and home health agencies.

For a closer look at MedPAC’s recommendations, see this MedPAC fact sheet or the complete MedPAC report to Congress.