FierceHealthcare reports that the Medicare Payment Advisory Commission (MedPAC) will recommend  that Congress cut by 30 percent the payment rates for standalone emergency departments within six miles of an on-campus hospital emergency room.  Modern Healthcare has reported that  the proposal could save Medicare up to $250 million a year if adopted.

The creation of standalone emergency departments have been exploding the last several years; that has  driven up health costs in some states.

Fierce reported that, “According to a MedPAC report,  most of the 566 standalone emergency departments in 2016 were  in metropolitan areas with existing capacity in more affluent areas with higher rates of privately insured patients. The growth of standalone emergency departments, they said, has been driven by “payment systems that reward treating lower severity cases in the higher paying ED setting” as well as competition for patient market share.

MedPAC last week also voted to  allow rural hospitals more than 35 miles from another emergency department to convert to a standalone ED that could bill under the outpatient prospective payment system. “It would also allow for annual payments to assist with their fixed costs.”

To read the Fierce article, please hit this link.