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Moratorium to become permanent ban?

Ambulatory Surgery Reimbursement Update, December 21, 2004

The specialty hospital industry took another hit last week, as the Medicare Payment Advisory Commission (MedPAC) moved forward with plans to make the current 18-month moratorium on physician referrals to specialty hospitals a permanent measure.

According to a release by the American Association of Ambulatory Surgery Centers (AAASC), MedPAC met with representatives from the Centers for Medicare and Medicaid Services (CMS) on Thursday, December 16, to recommend that the current moratorium (which runs through June 2005) become a permanent ban forbidding physicians to refer patients to specialty hospitals in which they have an ownership interest.

Observers of MedPAC's public commentary on this subject were somewhat shocked by the group's push for a permanent ban, according to the AAASC. This is because research conducted by MedPAC over the last several months had seemed to indicate the panel would simply recommend changes to the Medicare payment system in order to balance out inequities derived from physicians choosing patients on a financial profit basis. MedPAC did offer that recommendation, but also called for the moratorium to become permanent, effective immediately at its June 2005 expiration. MedPAC Commissioners plan to meet again in January to further discuss these recommendations.

To this point, the AAASC says that MedPAC has made no recommendations concerning physician ownership of ambulatory surgery centers (ASCs), but that the subject is being scrutinized by the AAASC and other ambulatory care regulators and advocacy groups because of MedPAC's hard stance on the concept of physician ownership as a whole.

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