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GAO-13-667R 1 (2013-06-27)

handle is hein.gao/gaobaahbl0001 and id is 1 raw text is: G A U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 June 27, 2013 The Honorable Tom Coburn, M.D. Ranking Member Committee on Homeland Security and Governmental Affairs United States Senate The Honorable Richard Burr Ranking Member Subcommittee on Primary Health and Aging Committee on Health, Education, Labor and Pensions United States Senate Subject: Medicare: Ownership Status of Inpatient Prospective Payment System Hospitals That Qualify for Payment Adjustments In 1983, Congress created the inpatient prospective payment system (IPPS) to help control the growth of hospital spending and give hospitals a strong incentive to provide care efficiently.1 Under this system, Medicare pays hospitals a flat fee per stay, set in advance, with different amounts for each type of condition. Payment rates are also influenced by such factors as the relative hourly wage in the area where the hospital is located and whether the hospital qualifies for additional payments. Congress can enhance Medicare payments to certain hospitals by changing the qualifying criteria for IPPS payment categories, creating and extending exceptions to I PPS rules, or exempting certain types of hospitals from the IPPS. Often such efforts are intended to help ensure beneficiary access to care or to help hospitals recruit and retain physicians and other medical professionals. In April 2013, we reported that numerous statutory provisions have been enacted from 1998 through 2012 to increase Medicare payments to a subset of hospitals.2 We also reported that nearly all hospitals in our review qualified for an IPPS payment adjustment or were excluded from the IPPS entirely in 2012. In response to these findings, you asked us to provide information about the ownership status of the I PPS hospitals included in our review, particularly those hospitals qualifying for payment adjustments in 2012. To address this issue, we analyzed two datasets from the Centers for Medicare & Medicaid Services (CMS): the fiscal year 2013 impact file and the 2013 Hospital Compare database. We used the impact file to identify hospitals paid under the IPPS as of July 2012, those hospitals that received payment adjustments, the category of adjustments for which 1See Social Security Amendments of 1983, Pub. L. No. 98-21, § 601, 97 Stat. 65 (1983) (codified, as amended, at 42 U.S.C. § 1395ww). 2GAO, Medicare: Legislative Modifications Have Resulted in Payment Adjustments for Most Hospitals, GAO-1 3-334 (Washington, D.C.: Apr. 17, 2013). GAO-13-667R Hospital Ownership Page 1

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