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Hospitals keep guard up on site-neutral plans

illustration of a hospital surrounded by circles overlaid with the capitol building and legal text

Illustration: Tiffany Herring/Axios

The hospital industry's biggest lobbying group is bracing for a revived push for site-neutral payment policies, even after the idea was left out of this spring's government spending deal.

Why it matters: The vigilance from the American Hospital Association reflects an awareness that the effort to address hospital costs has enough bipartisan support to resurface in a lame duck session, even if it faces tough odds.

What they're saying: "We will be continuing very much our efforts to educate Congress on the issues around site-neutral," Stacey Hughes, AHA's executive vice president of government relations and public policy, said in an interview with Axios.

  • The push to have Medicare pay hospital outpatient departments the same amount for the same service as independent physician offices has backing from experts on the left and right who say it would save patients and the government money.
  • Even after it was drastically scaled down to only apply to physician-administered drugs, it faced a tough road in the Senate, where lawmakers raised concerns about the impact on rural hospitals.
  • Hughes argued hospitals only get paid 82 cents on the dollar in Medicare already, and have higher costs treating patients with more conditions. "You can't use a bumper sticker slogan to evaluate reimbursement policy," she said.

Yes, but: A related proposal might have a better chance this fall. That measure would require hospital outpatient departments to have unique identifier numbers for billing purposes, to crack down on what critics call "dishonest billing."

  • Hughes acknowledged the idea has legs but called it an "additional burden, regulatory burden, from a Republican Congress, in terms of the House side."
  • Another obstacle, as we previously reported, is that Senate Majority Leader Chuck Schumer objects to the idea.

What's next: As a health care package shapes up for the lame duck session, hospitals will not just be playing defense against cost-cutting measures, but also advocating in favor of extending programs like hospital at home and telehealth flexibilities.

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