Becker's Hospital Review

8 CFO / FINANCE rates by 3.8 percent for ASCs that meet applicable quality reporting requirements. 7. CMS is finalizing a general payment rate of average sale price plus 6 percent for drugs and biologicals acquired through the 340B drug pricing program. 8. e agency is finalizing separate payment in ASCs for five non- opioid pain management drugs that function as surgical supplies, including certain local anesthetics and ocular drugs. Rural Emergency Hospitals rule 9. e agency established a new Medicare provider type called rural emergency hospitals, effective Jan. 1, to address concerns that rural and critical access hospital closures are reducing access to care for people in rural areas. 10. e final rule broadly defines "REH services" to include all covered outpatient department services when provided by rural emergency hospitals, which will be paid for at a rate equal to the OPPS payment rate — for the equivalent covered outpatient department service — increased by 5 percent, according to the agency. Beneficiaries will not be charged coinsurance on the additional 5 percent payment. 11. In 2023, rural emergency hospitals will receive a monthly facility payment that will increase in subsequent years by the hospital market basket percentage increase. Home Health Prospective Payment System rule 12. Home health agencies will receive a 0.7 percent Medicare payment boost, translating to an extra $125 million next year, according to the agency. 13. CMS said the increase reflects a 4 percent home health payment percentage, which will add $725 million, and a 0.2 percent increase because of an update to the fixed-dollar loss ratio used in calculating outlier payments, which will add $35 million. 14. CMS payments to home health agencies will drop 3.5 percent next year aer the agency found it has paid far more under the new patient-driven groupings model. An estimated $635 million will be docked from home health agency payments in 2023 and more cuts may be coming in the coming years. 15. To make home health payments more predictable, the agency is finalizing a budget-neutral 5 percent cap on negative wage index changes for home health agencies to facilitate yearly changes in the pre-floor, pre-reclassified hospital wage index. n For hospitals, 'difficult decisions' loom after 9 months of negative margins By Molly Gamble T he third quarter brought little relief to hospitals in what is shaping up to be one of their worst financial years. Kaufman Hall's October National Hospital Flash Report — based on data from more than 900 hospitals — found slightly lower hospital expenses in September did not outweigh lower revenue across the board, with decreases in discharges, inpatient minutes and operating minutes. The median year-to-date operating margin index for hospitals was -0.1 percent in September, marking a ninth straight month of negative operating margins and a dimmer outlook for their climb back into the black by year's end. Kaufman Hall noted that expense pressures and volume and revenue declines could force hospitals to make "difficult decisions" about service reductions and cuts. "Health systems are starting to get a clear picture of what service lines have a positive effect on their margins and which ones are weighing them down," said Matthew Bates, managing director and Physician Enterprise service line lead with Kaufman Hall. "Without a positive margin there is no mission. Health systems must think carefully and strategically about what areas of care they invest in for the future." n Kaiser Permanente reports $1.5B Q3 loss By Nathan Tucker O akland, Calif.-based Kaiser Foundation Health Plan, Kaiser Foundation Hospitals and their subsidiaries reported a net loss of $1.5 billion for the quarter ending Sept. 30, according to a Nov. 4 financial report. The company posted total operating revenues of $24.3 billion and total operating expenses of $24.3 billion for the quarter. Total operating revenues of $23.2 billion and total operating expenses of $23.1 billion for the same period in 2021. Additionally, there was an operating loss of $75 million in the third quarter compared to an operating income of $38 million in the third quarter of 2021, according to a Nov. 4 news release. "I am proud of our ability to navigate the challenges of the past few years, including a global economic crisis, the high cost of goods and services, supply chain issues, labor shortages, and the pandemic while serving our 12.6 million members," said Greg Adams, chair and CEO of Kaiser Permanente. The net loss of $1.5 billion in the third quarter of 2022 compares to a $1.6 billion net income in the third quarter of 2021. Capital spending totaled $2.5 billion year-to-date. "We are grateful to our extraordinary people whose commitment and compassion allow us to continue to fulfill our mission of providing high-quality and affordable care and improving the health of our communities," said Tom Meier, corporate treasurer of Kaiser Permanente. n

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