Policy: Entitlements

One day could make $600 million in difference for Medicare

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News,Watchdog Blog,Health Care,Entitlements

More than $600 million in Medicare costs could be saved by adopting a different payment policy on the government's share of costs when a patient transfers from a hospital to hospice care, according to the Department of Health and Human Services Inspector General.

The savings would come by a new payment policy that would transfer costs for patients' that discharge early from the hospital in order to go into hospice. About 30 percent of all such discharges should become "per diem" payments - or per day payments, according to the IG.

As things presently stand, although the patients are no longer in the hospital, Medicare continues making payments as though they were. As a result, Medicare missed out on saving $602,519,187 in 2009 and 2010.

An early discharge is defined as a patient leaving a day earlier than expected under Medicare guidelines.

The IG's audit also found that there would be no significant financial consequences for hospitals if Medicare adopted this new policy. The report did not discuss potential economic impacts on hospice care providers.

Go here to read the full report.

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