WASHINGTON – The Alliance for Site Neutral Payment Reform – a coalition of healthcare providers, insurers, employers and patient advocacy groups established to address growing access to care issues driven by disparities in payment rates for identical clinical services provided in different healthcare settings – today commended provisions in President Trump’s FY2020 Budget to expand site neutral payments for all off-campus hospital-owned physician practices.
Under the proposal, Medicare would pay all hospital-owned physician offices located off-campus at the physician office rate, which the Administration estimates would save approximately $28.7 billion over ten years. The budget also proposes to further eliminate payment disparities in outpatient care by applying site neutral payments for certain services performed at on-campus HOPDs which would result in $131.4 billion in savings.
Current policies allow “grandfathered” HOPDs to charge significantly higher rates than physician offices for performing the exact same services, resulting in unnecessary costs to taxpayers and Medicare beneficiaries. According to a November 2017 report by Avalere, Medicare paid an additional $2.7 billion on services and patients spent $411 million more in out-of-pocket costs when certain services were delivered in a hospital-owned setting.
The Alliance commends the proposal as a pro-patient policy that would lower out-of-pocket costs and preserve both patient access and choice. Data show disparities in Medicare payments across care settings drive up patient costs through consolidation in the healthcare marketplace resulting in higher premiums and copayments.
The Alliance supports payment parity across site of service in order to decrease Medicare and commercial spending, ensure patients receive the right care in the right setting, lower taxpayer and beneficiary costs and increase patient access. While patients need to access various outpatient services in hospital and non-hospital settings, often simultaneously, the Alliance encourages site neutral payment policies that are fiscally wise and enhance patients’ healthcare options.