Gem of the Week: Overhauling the Medicare Payment Model

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In this blog post I highlight an illuminating or groundbreaking news article or report on the environment or health from the past 5 days. This week’s gem goes to… the National Academy of Science’s Institute of Medicine for revealing deep weaknesses in the way Medicare determines how much to pay doctors and hospitals for covered expenses. The report also outlined ways to fix these weaknesses.

For example, as found in the NAS report, Medicare uses geographical market areas to help determine how much a kidney transplant will cost a hospital to perform. However, Medicare divides the US into only 89 geographic markets, and some of those markets are an entire state or a large city. So even though an independent hospital in rural Nebraska incurs more costs to provide an organ transplant, it would be reimbursed the same as a better-funded, corporate-owned hospital in downtown Omaha. The authors recommend revising how these geographical areas are determined, and integrating them other parts of the Medicare payment model.

Another large flaw the report found was the wage index Medicare uses to help determine how much it should pay doctors and staff for procedures. Instead of using survey data from the Centers for Medicare and Medicaid Services, the report’s authors recommend using the Bureau of Labor Statistics’s data because it’s independent and more accurate.

The report is just phase I in a two-part investigation: the final report will be released in 2012. Amid discussions of cutting Medicare entitlements and aging Baby Boomers, the report’s recommendations are vital information. Currently Medicare covers 47 million seniors and 8 million people with permanent disabilities. With so many subscribers, making payments more accurate could go a long way toward cutting waste (where it occurs), and making sure all hospitals and staff are fairly compensated Medicare services.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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