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Medicare to pay acute care hospitals $2B more for inpatients in 2018

Medicare will pay acute care hospitals 1.3% more in fiscal year 2018 on inpatient operating payments, while long-term care hospitals will also receive an update in reimbursements from the U.S. health insurance program, according to a final rule published Aug. 2.

The Centers for Medicare and Medicaid Services projects total payments to acute care hospitals for inpatient services will increase by $2.4 billion from fiscal year 2017 due to changes in the final rule.

Uncompensated care payment updates will also boost inpatient operating payments by an additional 0.7%. The agency will distribute about $6.8 billion in uncompensated care payments in fiscal year 2018, or $800 million more than in fiscal year 2017.

Acute care operators that may be affected include HCA Healthcare Inc., Community Health Systems Inc., LifePoint Health Inc., Tenet Healthcare Corp. and Universal Health Services Inc.

The long-term care hospitals prospective payment rate was updated by 1% for fiscal year 2018 in accordance with the Medicare Access and CHIP Reauthorization Act of 2015. Factoring other changes in reimbursement policy, such as the continued phase-in of the dual payment rate system, payments for these facilities are projected to decrease by 2.4%, or $110 million, in fiscal year 2018.

Long-term care operators that may be affected include Select Medical Holdings Corp. and Kindred Healthcare Inc.