KHN Morning Briefing

Summaries of health policy coverage from major news organizations

CMS Settles Medicare Reimbursement Dispute With Hospitals

With a price tag of about $3 billion, the agreement ends a decade-long dispute between an estimated 2,200 hospitals and the Centers for Medicare & Medicaid Services over the calculation of pay rate cuts and offsets for rural hospitals.  

Los Angeles Times: Medicare To Settle Hospital Reimbursement Dispute
Medicare agreed to settle a dispute with about 2,200 hospitals nationwide over a decade-long error in reimbursement rates, offering what could amount to a $3-billion infusion to hospitals already bracing for funding cuts under the federal healthcare law. More than 200 California hospitals are included in three similar agreements reached April 5, and they stand to share a total of more than $310 million (Terhune, 4/12).

Modern Healthcare: CMS' Hospital Settlements Seen Costing At Least $3 Billion
Ongoing CMS settlement negotiations with about 2,200 hospitals are expected to cost the federal government at least $3 billion, according to parties involved in the deal. The payments to hospitals will settle several similar years-long federal lawsuits in which those providers alleged CMS officials erred in calculating pay rate cuts needed to offset an increase for rural hospitals required by a 15-year-old law. The settlement process began when a federal appeals court struck down a lower court ruling that sided with the CMS (Daly, 4/12).

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