How will site neutral payment impact employed MD enterprise value?

[drusso]

Site Neutral Payment, 340B Payment Cuts Raise Hospitals' Hackles

"For example, under current rules the payment rate for a clinic visit at an off-campus PBD is about $116, with a $23 copayment. In shifting to the PFS-equivalent rate, the same off-campus PBD visit would cost about $81, with the patient copay falling to $16, after a 2-year transition period. Under this realignment, CMS estimated Medicare would save $380 million in 2019."

Site-Neutral Payments Finalized Despite Hospitals' Objections | HealthLeaders Media

"Today's rule advances competition by creating a level playing field for providers so they can compete for patients on the basis of quality and care," CMS Administrator Seema Verma said in a statement Friday. "The final policies remove unnecessary and inefficient payment differences so patients can have more affordable choices and options."

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[nvrsumr]

Will this affect office procedural reimbursement as well or just clinic visits?

Will this drive some pcps to go back into private practice? If so should eventually increase my referrals which is great

Looks like ASC owners are big winners. If stim implants and perhaps other procedures paid at hospital rates may drastically change the math on office procedure suites

From Drusso article:

• Expand the number of surgical procedures payable at ASCs to include additional procedures that can safely be performed in that setting;
• Ensure ASC payment for procedures involving certain high-cost devices generally parallels the payment amount provided to hospital outpatient departments for these devices; and
• Help ensure that ASCs remain competitive by addressing the differential between how ASC payment rates and hospital outpatient department payment rates are updated for inflation.

 

[jettavr6]

This is excellent news --

 

[callmeanesthesia]

Perhaps I’m missing something but how is this good for private practice? Seems like it hurts hospitals but doesn’t help PP. I get that site of service differential is unfair but I don’t see the benefit in a big pay cut for medical services for our specialty on average. Seems like it will just force hospitals to reorganize, and presumably hire and train more mid-levels to do our jobs. (I’m in private practice)

 

[Dr. Ice]

Perhaps I’m missing something but how is this good for private practice? Seems like it hurts hospitals but doesn’t help PP. I get that site of service differential is unfair but I don’t see the benefit in a big pay cut for medical services for our specialty on average. Seems like it will just force hospitals to reorganize, and presumably hire and train more mid-levels to do our jobs. (I’m in private practice)

I can see the influx of mid levels in primary care roles if/when this happens. I think we may also see the formation of larger multi specialty groups if primary care docs choose to enter the private sphere again.

 

[jettavr6]

Perhaps I’m missing something but how is this good for private practice? Seems like it hurts hospitals but doesn’t help PP. I get that site of service differential is unfair but I don’t see the benefit in a big pay cut for medical services for our specialty on average. Seems like it will just force hospitals to reorganize, and presumably hire and train more mid-levels to do our jobs. (I’m in private practice)

It is a first step in ending the market consolidation movement by the hospitals. And this isn't to say that the hospitals shouldn't make more on many of the services that they offer in the hospital. It simply eliminates the excess cost which the hospital acquired office down the hall adds to the system for doing the "exact" same service that the non-hospital owned office performs. In many cases, the offices are literally next door to each other with one getting 40% more than the other for the same service - and at higher cost to the patient.

 

[Ducttape]

I wouldn’t see much change. Fact of the matter is that most hospitals own ASCs. They will just move procedures to the ASC.

when CMS targets ASCs, that’s when the hospitals will close the clinics.



After that, why not cut in office costs, save even more money?

 

[drusso]

Hospitals Chafe Under Medicare’s New Payment Rule For Off-Campus Clinics - KFF Health News

Under the rule that took effect this year, Medicare will lower payments for clinic visits performed at hospital-owned facilities to a rate that is equivalent to what it pays an independent doctor. Federal officials expect the move will save the government $380 million this year.

khn.org

"When a nonprofit hospital acquires an independent clinic, it effectively removes a tax-paying business from the area. That’s because nonprofit hospitals are exempt from paying certain federal, state and local taxes in exchange for providing community benefits.
“So not only do they [hospitals] get the facility fee,” Jameson Carey said, but also, “they don’t have to pay taxes.”

 

[Ferrismonk]

So they won't open up a primary care clinic in the rural area because they'll be paid the same as an independent doctor for the same service. What a terrible argument.