MedPAC members continue to debate whether equalizing the payments for outpatient services delivered in physicians’ offices and in hospital outpatient facilities and departments makes for good public policy.  Currently, hospitals receive additional payments for outpatient evaluation and management (E&M).
Some commissioners and advocates argued at MedPAC’s November 2 meeting that the federal government should pay for Medicare services based on the services themselves, not on where they are provided.  Others maintained that hospitals have inherently greater costs because of the additional service capacity they bring and that it is appropriate for Medicare to help pay for that capacity because it enables hospitals to meet the needs of many Medicare patients.
This is an important issue for many Pennsylvania safety-net hospitals.  In recent years, many of these hospitals have invested heavily in developing their capacity to serve more patients on an outpatient basis.
MedPAC (Medicare Payment Advisory Commission) advises Congress on Medicare reimbursement issues.  Its recommendations, while considered influential, are not binding on Congress.
Learn more about this issue in this article from CQ HealthBeat as presented by the Commonwealth Fund.  In addition, the presentation that MedPAC’s staff made to commission members can be downloaded here, from MedPAC’s web site.