Over the past couple months, the PDN has published a few stories regarding the recent decision by Medicare (CMS, HHS) to reduce the payments to Olympic Medical Center (OMC) for visits to its off-site physician clinics.
I believe a bit more explanation is required.
First, a little background.
Since Virginia Mason left our town and OMC saved primary care, I had been involved in developing systems that would allow for payment levels that would allow the clinic on Eighth Street to remain viable.
Simply put, Medicare is no longer going to subsidize the cost of providing physician care at a hospital campus facility.
Medicare essentially expects private insurance companies to subsidize the care provided to our Medicare population.
Clearly a broken system.
To help hospitals provide such care, Medicare developed what’s called “provider-based reimbursement.”
This is government speak for a system that provides separate compensation to the physician, or other providers, and to the facility, in this case OMC, for the service they each separately provide.
This total payment is greater than that which Medicare will provide an independent physician for similar service.
And of course the nation’s taxpayers are burdened with this greater payment.
However, the patient is being seen by a facility that meets much greater administrative, clinical and life safety requirements than those of an independent physician.
Under the new system, Medicare — the taxpayers — will pay the same regardless if the service is provided at an independent physician office or at Olympic Medical Center.
Some will argue this makes good sense.
Others will argue that a hospital such as OMC has much greater operating expenses and deserves the greater payment from our nation’s taxpayers.
I’ll leave that for each person to decide.
Mic Sager,
Port Angeles