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HRD-82-109 1 (1982-08-06)

handle is hein.gao/gaobabmoz0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE mWASHINGTON, D.C. 20548 HUMAN RESOURCES D$vISION August 6, 1982 B-208447 The Honorable Max Baucus United States Senate Dear Senator Baucus: Subject: Impact of Medicare Reimbursement Limits on Small Rural Hospitals (GAO/HRD-82-109) This is in response to. your March 23, 1982, request that we review the impact on small rural hospitals of Medicare's routine inpatient hospital operating cost reimbursement limits, which are established under section 223 of the Social Security Amendments of 1972 (Public Law 92-603). You also asked that we review the Health Care Financinq Administration's (HCFA's) implementation of these limits and the program to exempt sole community providers (SCPs) from the limits. We discussed your request with your office and agreed to review (1) the legislative and regulatory basis for the SCP exemption, (2) the effect of SCP exemptions on small rural hospitals, (3) the administration of the SCP exemp- tion program, and (4) a sample of Montana hospital SCP cases to see if all the relevant factors were considered. Our analysis of the reimbursement limits' impact on rural hospitals indicates that those with fewer than 50 beds are being affected comparatively more than larger hospitals. If a separate reimbursement limit were established for rural hospitals with fewer than 50 beds, the impact on them would be reduced while Medicare could save an estimated $3.7 million because of the resulting revised limits on other hospitals. Regarding the SCP exemption program, HCFA needs to better define the important terms and criteria related to it. HCFA should also assure that the program is implemented uniformly across the Nation. (106229) 119483

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