The Centers for Medicare & Medicaid Services (CMS) has increased payments to 121 hospitals in 25 states for patients who are discharged on or after April 1.
The hikes are due to the geographic reclassification of these hospitals under a special one-time-only provision in the recent Medicare modernization law.
As part of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), Congress directed CMS to create a one-time-only appeals procedure for certain hospitals that fell outside Medicare's existing criteria for reclassification from their current geographic areas into an adjoining area with higher payment rates. Nearly 550 hospitals had appealed based on one or more of eight criteria established by CMS.
To fund the increased payments, Congress allocated up to $900 million dollars over three years.