Maryland hospitals and insurance carriers are preparing for a showdown Wednesday with the state’s Health Services Cost Review Commission over what rates hospitals will get paid for certain services. But regardless of the outcome, they’ll be back for a rematch before the year is up.
The HSCRC, which sets hospital rates, is set to take up the annual issue at its meeting June 5. The commission’s staff is recommending a 1.65 percent increase to rates, which they say is a balance between the need to protect the state from breaking the terms of its Medicare waiver and being cognizant of hospitals’ concerns about their financial condition. Hospitals would like a higher rate increase and insurance carriers are arguing the rate increase should be lower.
Maryland has come dangerously close to breaking a key condition of its Medicare waiver — that growth in Medicare rates stay below national growth. Increasing hospital rates here will push the state closer to that line.
“In deciding how to proceed in this challenging environment, preserving the waiver is the primary goal,” the staff report says. “However, as staff is forecasting some waiver cushion this year, in this year’s update, we are also reflecting upon hospitals’ financial conditions, as well as the affordability of care to the patients in Maryland hospitals.”
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Hospitals say the HSCRC also needs to consider hospitals’ financial condition, which has been declining in part because of a low rate update last year and lower than expected admissions. The Maryland Hospital Association has proposed a rate increase of 2.43 percent.
Date: Jun 3, 2013