February 04, 2005

Crapo: Financial Relief Coming To Rural Hospitals

Payment rates increased as part of Medicare modernization

Washington, DC â?? Patients and medical providers in Idahoâ??s rural areas stand to benefit from a new rule finalized this week by the Centers for Medicaid and Medicare Services (CMS). Idaho Senator Mike Crapo today praised a rule change that will increase Medicare payments to Idahoâ??s rural hospitals by more than six percent. The new rule, which takes effect October 1, 2004, implements payment and policy changes as required by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). â??Traditionally, health care providers in rural states like Idaho have received less compensation from Medicare than those in urban areas," said Crapo, a member of Senate Rural Health Caucus. â??Accordingly, access to care in these areas has suffered. The new rule, while improving the payment rates of all hospitals, provides additional relief to rural hospitals. The end result of the changes in this rule will be increased access to quality care for Idaho seniors and families.â?? CMS projects that the combined impact of an inflation update and other proposed changes in the rule will yield an average payment rate increase of 6.2 percent for rural hospitals. The rule includes payments to hospitals in remote areas to compensate for the higher costs associated with having a low volume of total discharges. It also clarifies Medicareâ??s hospital classifications to ensure that rural hospitals are classified into areas with higher payment rates. The final rule also implements a number of provisions in the MMA designed to help critical access hospitals (CAHs), as CAHs serve rural beneficiaries. The goal of the rule change, according to CMS Administrator Mark B. McClellan, M.D., Ph.D, is to â??provide Medicare beneficiaries with increased access to high quality inpatient hospital care. It all adds up to good news for beneficiaries, and, particularly for rural hospitals, it represents a significant increase in hospital payment rates.â?? For more information on the rule, visit the CMS Website at www.cms.hhs.gov. # # #