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Rural hospitals’ lucrative rehab business


The Associated Press reports that federal investigators have found that a law lets rural hospitals bill Medicare for rehabilitation services for seniors at higher rates than nursing homes and other facilities and cost billions of dollars in extra government spending.

Yet more reasons why Medicare spending is out of control.

Most patients could have been moved to a skilled-nursing facility within 35 miles of the hospital at about one-fourth the cost, the U.S. Department of Health and Human Services’ inspector general said.

The AP reported that hospitals ”juggling tough balance sheets have come to view such ‘swing-bed’ patients as lucrative, fueling a steady rise in the number of people getting such care and costing Medicare an additional $4.1 billion over six years.”

”Legislation passed by Congress in 1997 created the designation of ‘critical-access hospitals’ to help small facilities in remote areas survive. Rather than paying set rates for services as throughout the rest of the Medicare system, the federal government reimburses the hospitals for 101 percent of their costs. They also often receive state funding and grants.”

Congress, as now, was controlled by Republicans in 1997. Many represent rural areas in the South and West with many such “critical-access hospitals.”

The AP said that Alan Morgan,  chief executive of the National Rural Health Association, agreed  that Medicare could save money by modifying the system. But he told the AP that  dozens of rural hospitals have closed in the past five years, and nearly 300 others are very financially fragile. The Obama administration has already proposed  cutting all reimbursements  to critical-access hospitals, which  Morgan said would further accelerate the closures.

”Some hospitals received critical access designation under old rules and were grandfathered in. A previous report from the inspector general’s office found the vast majority would not meet the requirements if forced to requalify,” the news service reported.



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