Hospitals see their Medicaid rates cut


Oregon’s largest hospitals are feeling the effects of having their Medicaid payments reduced by 15% due to budget cuts.

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Oregon’s largest hospitals are feeling the effects of having their Medicaid payments reduced by 15% due to budget cuts.

Because of the lagging economy, the decision to lower hospital rates was unavoidable, said Dr. Bruce Goldberg, director of the Oregon Health Authority.

“I know that hospitals need to stay in business; so do the managed care plans,” he said. “We need to create a climate where the hospitals and the health plans can work together.”

Currently, urban hospitals receive Medicaid payments based on a person’s medical condition, known as a Diagnostic Related Group (DRG). If hospitals could work alongside health plans to lower admission rates for people with asthma or heart failure, for example, ultimately they could share in those savings, Goldberg said.

“Hospitals make their finances work by admitting people so they need some incentives to keep people out of the hospital,” he added. “We have to move away from managing care by reducing rates or reducing benefits to create a more efficient healthcare system, and we hope that we can continue getting support from the federal government to move forward.”

Read more at The Lund Report.

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