References for Two Op-Eds on The Rising Cost of Healthcare:

"Costs soar when doctors work for hospitals" Lexington Herald Leacer. March 22, 2012. http://www.kentucky.com/2013/04/22/2610324/costs-soar-when-doctors-work-for.html

"Hospital Facility Fees Raise Out-of-Pocket Costs for Medicare Patients." US News and World Report. Jan 11, 2013 http://www.usnews.com/opinion/articles/2013/01/28/hospital-facility-fees-raise-out-of-pocket-costs-for-medicare-patients

(1) The Organisation for Economic Co-operation and Development (OECD) http://www.oecd.org/a>

(2) Hogan MC, Foreman KJ, Naghavi M, Ahn SY, Wang M, Makela SM, Lopez AD, Lozano R, Murray CJ. Maternal mortality for 181 countries, 1980-2008: a systematic analysis of progress towards Millennium Development Goal 5. Lancet. 2010 May 8;375(9726):1609-23. doi: 10.1016/S0140-6736(10)60518-1. Epub 2010 Apr 9. PMID: 20382417
http://www.lancet.com/journals/lancet/article/PIIS0140-6736(10)60518-1/fulltext?_eventId=login

'World News' Wants Your Stories About Difficult or Tragic Pregnancies. ABC News. March 4. 2010. http://abcnews.go.com/WN/world-news-hear-thoughts-maternal-mortality/story?id=10012018#.UOXAnSMo6TM

(3) Gunts Ed. Md. Sees hospital building boom. In the face of downturn, expansions in central part of state exceed $2 billion. The Baltimore Sun. March 28, 2012. http://articles.baltimoresun.com/2010-03-28/business/bal-bz.hospitals28mar28_1_pam-barclay-center-for-hospital-services-maryland-health-care-commission

Blackford LB. Goal for University of Kentucky medical complex: Regional Powerhouse. Lexington Herald Leader. Sept. 15, 2012
http://www.kentucky.com/2012/09/15/2338582/goal-for-university-of-kentucky.html

(4) Torres C. Health Spending Will Climb To Nearly One-Fifth Of GDP. Kaiser Healthcare News. June 12, 2012.
http://capsules.kaiserhealthnews.org/index.php/2012/06/report-health-spending-will-climb-to-nearly-one-fifth-of-gdp/

Keehan SP, Cuckler GA, Sisko AM, Madison AJ, Smith SD, Lizonitz JM, Poisal JA, Wolfe CJ. National health expenditure projections: modest annual growth until coverage expands and economic growth accelerates. Health Aff (Millwood). 2012 Jul;31(7):1600-12. doi: 10.1377/hlthaff.2012.0404. Epub 2012 Jun 12.
http://content.healthaffairs.org/content/early/2012/06/11/hlthaff.2012.0404
http://www.ncbi.nlm.nih.gov/pubmed/22692089

(5) Study: Three in four doctors hired in 2014 will work for hospitals. The advisory board company. The daily briefing. July 10, 2012. http://www.advisory.com/Daily-Briefing/2012/07/10/More-than-75-percent-of-newly-hired-physicians-will-work-for-hospitals

(6) Davis D. Medical billing, a world of hurt: Patients confused about hospital charges for doctors visits. Cleveland.com Sept. 22, 2012 http://www.cleveland.com/healthfit/index.ssf/2012/09/medical_billing_a_world_of_hur_4.html

Neff J. Doctors join hospitals, and prices soar. Newsobserver.com Dec. 16, 2012
http://www.newsobserver.com/2012/12/15/2547121/doctors-join-hospitals-and-prices.html

Ostrom CM. Why you might pay twice for one visit to doctor. Seattle times. Nov. 3, 2012.
http://seattletimes.com/html/localnews/2019600338_facilityfees04m.html

(7) Medicare Payment Advisory Commission, Report to Congress. March 2012, p. xiv. http://www.medpac.gov/documents/Mar12_EntireReport.pdf .

Oct 4, 2012 Med PAC presentation “Addressing payment differences across settings: Ambulatory care services.”
http://www.medpac.gov/transcripts/1012_presentation_amcareservices.pdf

(8) Barclay L. Surgeons Choose Hospital Employment Over Private Practice. Medscape Medical News. Dec. 17, 2012. http://www.medscape.com/viewarticle/776305

(9) Centers for Medicare & Medicaid Services (CMS), HHS. Medicare and Medicaid Programs: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Electronic Reporting Pilot; Inpatient Rehabilitation Facilities Quality Reporting Program; Revision to Quality Improvement Organization Regulations Federal Register / Vol. 77, No. 221 / Thursday, November 15, 2012 / pages 86466, 86535, 68549, 68557

Page 258

After consideration of the public comments we received, we are applying our established methodology for determining the final CY 2013 ASC conversion factor. Using more complete CY 2011 data for this final rule with comment period than was available for the proposed rule, we calculated a wage index budget neutrality adjustment of 1.0008. Based on updated data, the CPI– U for the 12-month period ending with the midpoint of CY 2013 is now projected to be 1.4 percent, while the MFP adjustment (using the revised IGI series to proxy the labor index used in the MFP forecast calculation as discussed and finalized in the CY 2012 MPFS final rule with comment period) is 0.8 percent, resulting in an MFP adjusted CPI–U update factor of 0.6 percent.

Page 327

We estimate that the update to the conversion factor and other adjustments (not including the effects of outlier payments, the pass-through estimates, and the application of the frontier State wage adjustment for CY 2013) will increase total OPPS payments by 1.8 percent in CY 2013. The changes to the APC weights, the changes to the wage indices, the continuation of a payment adjustment for rural SCHs, including EACHs, and the payment adjustment for cancer hospitals will not increase OPPS payments because these changes to the OPPS will be budget neutral. However, these updates will change the distribution of payments within the budget neutral system. We estimate that the total change in payments between CY 2012 and CY 2013, considering all payments, including changes in estimated total outlier payments, pass through payments, and the application of the frontier State wage adjustment outside of budget neutrality, in addition to the application of the OPD fee schedule increase factor after all adjustments required by sections 1833(t)(3)(F), 1833(t)(3)(G) and 1833(t)(17) of the Act, will increase total estimated OPPS payments by 1.9 percent.

Page 341

We calculated the CY 2013 ASC conversion factor by adjusting the CY 2012 ASC conversion factor by 1.0008 to account for changes in the prefloor and pre-reclassified hospital wage indices between CY 2012 and CY 2013 and by applying the CY 2013 MFP adjusted CPI–U update factor of 0.6 percent (projected CPI–U update of 1.4 percent minus a projected productivity adjustment of 0.8 percent). The CY 2013ASC conversion factor is $42.917.

Page 349

D. Conclusion

The changes we are making in this final rule with comment period will affect all classes of hospitals paid under the OPPS and will affect both CMHCs and ASCs. We estimate that most classes of hospitals paid under the OPPS will experience a modest increase or a minimal decrease in payment for services furnished under the OPPS in CY 2013. Table 57 demonstrates the estimated distributional impact of the OPPS budget neutrality requirements that will result in a 1.9 percent increase in payments for all services paid under the OPPS in CY 2013, after considering all changes to APC reconfiguration and recalibration, as well as the OPD fee schedule increase factor, wage index changes, including the frontier State wage index adjustment, estimated payment for outliers, and changes to the pass-through payment estimate. However, some classes of providers that are paid under the OPPS will experience more significant gains and others will experience modest losses in OPPS payments in CY 2013. We estimate that hospitals for whom DSH data are not available (non-IPPS, largely urban hospitals) will experience an increase of 8.3 percent due to increased payments for partial hospitalization, group psychotherapy and hemodialysis services. CMHCs will see an overall decrease in payment of 4.4 percent as a result of a decrease in their estimated costs.

The updates to the ASC payment system for CY 2013 will affect each of the approximately 5,300 ASCs currently approved for participation in the Medicare program. The effect on an individual ASC will depend on its mix of patients, the proportion of the ASC’s patients who are Medicare beneficiaries, the degree to which the payments for the procedures offered by the ASC are changed under the ASC payment system, and the extent to which the ASC provides a different set of procedures in the coming year. Table 58 demonstrates the estimated distributional impact among ASC surgical specialties of the MFP-adjusted CPI–U update factor of 0.6 percent for CY 2013.

(10) Caramenico A. 7-figure paychecks here to stay at nonprofit hospitals. FierceHealthcare. Dec. 13, 2012 http://www.fiercehealthcare.com/story/7-figure-paychecks-here-stay-nonprofits/2012-12-13

(11) Letter from Senator Bernard Sanders to Richard Umbdenstock, President and Chief Executive Officer from the American Hospital Association. Oct. 3, 2011. http://www.sanders.senate.gov/imo/media/doc/Document%20(2).pdf

Presentation by Rosemary Gibson: http://www.healthwatchusa.org/conference2012/videos-gibson/20121107-rosemary-gibson.htm

Other Websites Which Have Covered Senator Bernard Sanders' Letter. http://www.sanders.senate.gov/newsroom/news/?id=0645f503-2e5e-4f83-8568-cb454a57bf09
http://www.politico.com/politicopulse/1011/politicopulse596.html
http://www.highbeam.com/doc/1G1-268815464.html
http://www.motherjones.com/mojo/2011/09/raising-retirement-age-back-table