Site-neutral payment cuts hit our communities hard

November 28, 2018

The Centers for Medicare and Medicaid Services (CMS) recently finalized a plan to cut its payment rate for office visits at off-campus, hospital-based clinics. The cuts are scheduled to phase in over the next two years, ultimately cutting the payment rate by 60 percent. We are very disappointed with this outcome.

These cuts would hit our state hard, cutting Medicare payments to our state by about $15 million in 2019, expanding to $30 million per year or more by 2020. After 10 years, we estimate our state would suffer an estimated $424 million in payment cuts.

These cuts are more than just numbers; they represent reduced access to care for many of our state’s most vulnerable residents. Many private practices have closed or severely limited access for Medicare patients because of low payment rates and the challenges of operating in an intensely regulated environment. Also, specialized care, like cancer care and wound care, is increasingly unsuitable in a non-hospital context. In many cases, the hospital-based clinics these cuts target are the only source of Medicare services in a community. These cuts threaten the ability of hospitals to provide the services their residents need.

WSHA commented in a letter to CMS about our strong concerns and lobbied our congressional delegation to sign onto a letter that urged CMS to not move forward with the cuts. The American Hospital Association intends to challenge the legal basis of the cuts. By the end of this week, WSHA will send finance leaders at our member hospitals a summary of the ruling and an analysis of the impact of the proposed cuts.


Chelene Whiteaker
WSHA Senior VP, Government Affairs


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