MedPAC: Medicare Spending Must Be Checked

WASHINGTON–If Medicare spending growth is left unchecked, the
program will absorb “unprecedented shares” of the gross national
product and federal spending, the Medicare Payment Advisory
Commission warned last week.

In its semiannual report to Congress, MedPAC said that changes
to the program should include better calibration of provider
payments and the rewarding of efficiencies.

“The last strategy–increasing efficiency–is the most desirable
because it would enable the Medicare program to do more with its
resources,” the report said. Medicare should “pay no more than what
is required to obtain quality services and good access to
care.”

The report said efficient providers are those that “use fewer
inputs to produce quality outputs.”

One of MedPAC’s recommendations included freezing Medicare
payment rates in 2007 for home health agencies, which the American
Association for Homecare called “unwarranted, unjust and unsound”
in a formal response last week.

“For MedPAC to suggest anything that continues to undercut the
financial underpinnings of the home health benefit is simply beyond
the pale at a time when the first wave of the baby boomers will
begin retiring in the next 18 months and will be depending on
Medicare,” said AAHomecare COO Sue Mairena.

To view the report, visit www.medpac.gov.

To view AAHomecare’s response, visit www.aahomecare.org.