Medicare Payment Policy

7-7
8–5
FIguRe
25
20
15
10
Medicare margin (in percent) FIGURE
5
0
2003
Freestanding snF Medicare margins continue to increase
Note: SNF (skilled nursing facility). Range of estimates for 2011 incorporate different assumptions about days, revenues, and costs.
Source: MedPAC analysis of freestanding SNF cost reports from 2003 to 2011.
Note: Note and Source are in InDesign.
2004
2005
2006
2007
Freestanding Medicare margins....
Source:
2011 using 2011 claims matched to freestanding facilities’ 10 percent and the 4th year in a row it was above 15
cost reporting periods and we adjusted the revenues for percent. Margins spiked in 2011 because of Medicare’s
differences between claims and cost reports. To estimate overpayments in implementing the new case-mix groups.
2011 costs, we calculated cost per day in 2010 and This spike aside, Medicare payments per day have
modeled three cost growth assumptions: the market basket increased faster than costs per day since 2006, resulting in
Notes about this graph:
for 2011, the most recent cost increase between 2009 and growing SNF margins.
2010, and • the Data middle is in point the datasheet. between the Make two. We updates used in the datasheet.
claims to
In 2011, hospital-based facilities (3 percent of facilities)
• estimate WATCH the FOR days GLITCHY in 2011 but RESETS adjusted WHEN the count YOU UPDATE DATA!!!!
for historical differences between the day counts in the
continued to have negative Medicare margins (–60
• The column totals were added manually.
claims and cost reports. We did not estimate margins by
percent). However, administrators consider the SNF
ownership • I or had location. to manually draw tick marks and axis lines units because in the context they of kept the resetting hospital’s when overall I financial changed any data.
performance. Hospitals with SNFs can lower their
• I can’t delete the legend, so I’ll just have to crop it out in InDesign.
SNF aggregate Medicare margins have steadily increased inpatient length of stay and make inpatient beds available
since 2005 • Use (Figure direct 8-5). selection The revised tool case-mix to select groups items for modification. to treat additional Otherwise admissions. if you As use a result, the black SNFs selection contribute tool, they
implemented default in 2006 when led you to even change higher the Medicare data.
to the bottom line financial performance of the hospitals.
margins,
•
reflecting
Use paragraph
the continued
styles
concentration
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days
to format.
Hospitals with SNFs had lower inpatient costs per case
in the highest paying case-mix groups. Estimates of the and higher inpatient Medicare margins than hospitals
Medicare • margin Data was for freestanding from: R:\Groups\MGA\data SNFs in 2011 range book without 2007\data SNFs. Given book the 2007 mix of chp1 patients that hospital-
from 22 percent to 24 percent. This year is the 11th based facilities treat and their therapy practices, the
consecutive year that the average SNF margin exceeded Commission’s changes to the SNF PPS would increase
2008
Range of estimated margin
2009
2010
2011
Report to the Congress: Medicare Payment Policy | March 2013
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