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Hospitals sue over new Medicare cuts to clinics

A patient receives a checkup from a doctor.
A patient getting a medical checkup. Photo: Joe Raedle/Getty Images

The nation's primary hospital lobbying groups are suing the federal government to stop a new regulation that will cut Medicare payments for routine checkups in doctors' offices owned by hospitals.

The bottom line: This lawsuit was expected after the Centers for Medicare & Medicaid Services finalized the rule in November. CMS said the policy, which would cut payments by $760 million in 2019, "will control unnecessary volume increases," but hospitals are arguing the government overstepped its legal authority by "making draconian payment reductions targeting only specific services."