Fee Cuts Research Articles

Evaluation of US Hospital Episode Spending for Acute Inpatient Conditions After the Patient Protection and Affordable Care Act

Under the Patient Protection and Affordable Care Act (ACA), US hospitals were exposed to a number of reforms intended to reduce spending, many of which, beginning in 2012, targeted acute care hospitals and often focused on specific diagnoses (eg, acute myocardial infarction, heart failure, and pneumonia) for Medicare patients. Other provisions enacted in the ACA and under budget sequestration (beginning in 2013) mandated Medicare fee cuts. To evaluate the association between the enactment of ACA reforms and 30-day price-standardized hospital episode spending. This policy evaluation included index discharges between January 1, 2008, and August 31, 2015, from a national random 20% sample of Medicare beneficiaries. Data analysis was performed from February 1, 2019 to July 8, 2020. Payment reforms after passage of the ACA. 30-day price-standardized episode payments. Three alternative estimation approaches were used to evaluate the association between reforms following the ACA and episode spending: (1) a difference-in-difference (DID) analysis among acute care hospitals, comparing spending for diagnoses commonly targeted by ACA programs with nontargeted diagnoses; (2) a DID analysis comparing acute care hospitals and critical access hospitals (not exposed to reforms); and (3) a generalized synthetic control analysis, comparing acute care and critical access hospitals. Supplemental analysis examined the degree to which Medicare fee cuts contributed to spending reductions. A total of 7 634 242 index discharges (4 525 630 [59.2%] female patients; mean [SD] age, 79.31 [8.02] years) were included. All 3 approaches found that reforms following the ACA were associated with a significant reduction in episode spending. The DID estimate comparing targeted and untargeted diagnoses suggested that reforms following the ACA were associated with a -$431 (95% CI, -$492 to -$369; -2.87%) change in total spending, while the generalized synthetic control analysis suggested that reforms were associated with a -$1232 (95% CI, -$1488 to -$965; -10.12%) change in total episode spending, amounting in a total annual savings of $5.68 billion. Cuts to Medicare fees accounted for most of these savings. In this policy evaluation, the ACA was associated with large reductions in US hospital episode spending.

The relation between audit fee cuts during the global financial crisis and earnings quality and audit quality

The Global Financial Crisis (GFC) presents a unique opportunity to study how auditors respond to an exogenous shock to the clients' operating environment. Also, due to the GFC, auditors were under pressure from clients to cut audit fees during the crisis. Regulators were concerned that lower audit fees could result in lower audit effort, and more importantly, impair audit quality. We conduct a comprehensive analysis of multiple attributes of client firms' earnings quality and audit quality. Collectively, our findings indicate that there is no significant difference in earnings quality between client firms that received a fee cut during the GFC and control firms consisting of firms that did not receive a fee cut and firms that received a fee cut before the GFC. Further, there is no significant difference in the likelihood of a going concern opinion or a financial restatement, our proxies for audit quality, between client firms that received a fee cut during the GFC and control firms. Our findings contribute to understanding the role of auditors during the GFC.

MACRA: Big Fix or Big Problem?

Ideas and Opinions18 July 2017MACRA: Big Fix or Big Problem?J. Michael McWilliams, MD, PhDJ. Michael McWilliams, MD, PhDFrom Harvard Medical School and Brigham and Women's Hospital, Boston, Massachusetts.Search for more papers by this authorAuthor, Article, and Disclosure Informationhttps://doi.org/10.7326/M17-0230 SectionsAboutFull TextPDF ToolsAdd to favoritesDownload CitationsTrack CitationsPermissions ShareFacebookTwitterLinkedInRedditEmail In January 2017, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) took effect, ushering in a new system for physician payment in Medicare. With MACRA, policymakers ended the Sustainable Growth Rate (SGR) method for updating physician fees in Medicare and provided a permanent “doc fix,” relieving Congress of its annual duty to override substantial fee cuts that the SGR would have imposed. In place of the SGR, MACRA instituted the Merit-based Incentive Payment System (MIPS), which intends to reward clinicians for providing higher-quality and lower-cost care. Under the MIPS, the performance of providers (individuals or groups) is assessed ...

A Single-Payer System Can Save Primary Care

A Single-Payer System Can Save Primary Care

The Relation between Audit Fee Cuts during the Global Financial Crisis and Earnings Quality and Audit Quality

The Global Financial Crisis (GFC) presents a unique opportunity to study how auditors respond to an exogenous shock to the clients’ operating environment. Also, due to the GFC, auditors were under pressure from clients to cut audit fees during the crisis. Regulators were concerned that lower audit fees could result in lower audit effort, and more importantly, impair audit quality. We conduct a comprehensive analysis of multiple attributes of client firms’ earnings quality and audit quality. Collectively, our findings indicate that there is no significant difference in earnings quality between client firms that received a fee cut during the GFC and control firms consisting of firms that did not receive a fee cut and firms that received a fee cut before the GFC. Further, there is no significant difference in the likelihood of a going concern opinion or a financial restatement, our proxies for audit quality, between client firms that received a fee cut during the GFC and control firms. Our findings contribute to understanding the role of auditors during the GFC.

Medicare Fee Cuts and Cardiologist-Hospital Integration.

Physician practices are increasingly integrating with hospitals.1 For physicians, the expansion of accountable care organization contracts centered on providers taking responsibility for population spending and quality makes independent practice more challenging. For hospitals and health systems, acquiring practices helps them control referral patterns, coordinate care, and improve their bargaining power with payers. In 2010, based on recommendations from the American Medical Association and a national practice expense survey of physicians, the Centers for Medicare and Medicaid Services reduced fees for cardiology services, focusing on those delivered in the office setting.2 For example, payment for a myocardial perfusion image in the office was cut 26%, compared to 5% in the hospital outpatient department (HOPD). That for an echocardiogram was cut 16% in the office, compared to a 3% increase in the HOPD setting. This widened the already existing payment gap favoring HOPDs—by 2013, an echocardiogram cost Medicare 141% more in HOPDs than in the office.3 The American College of Cardiology (ACC) projected a surge of integration in response to physician office fee reductions, with cardiologists exchanging practice ownership for more predictable salaries as hospital employees.4 We analyzed trends in cardiologist-hospital integration.

Medicare Fee Cuts and Hospital- vs Office-Based Cardiovascular Imaging Services.

Medicare Fee Cuts and Hospital- vs Office-Based Cardiovascular Imaging Services.

Solving the Sustainable Growth Rate formula conundrum continues steps toward cost savings and care improvements.

Congress is again attempting to repeal the Sustainable Growth Rate (SGR) formula. The formula is a failed mechanism intended to constrain Medicare Part B physician spending by adjusting annual physician fee updates. Congress has averted formula-driven physician fee cuts each year beginning in 2003 by overriding the SGR, usually accompanied with last-minute disputes about how these overrides should be paid for. Last year Congress achieved bipartisan and bicameral agreement on legislation to replace the SGR—the SGR Repeal and Medicare Provider Payment Modernization Act of 2014, which we refer to as the "2014 SGR fix"—but was unable to find a way to pay for the legislation under current budget rules. Current congressional deliberations appear focused on how to pay for the fix, with wide consensus that the 2014 legislation should remain the basic model for reform. We describe key features of the 2014 SGR fix, place it in the context of both past and ongoing Medicare health policy, assess its strengths and weaknesses as a mechanism to foster improved care and lower costs in Medicare, and suggest further actions to ensure success in meeting these goals.

Association's Policy Focus Is on New Quality Measures

Association's Policy Focus Is on New Quality Measures

Is there a relation between audit fee cuts during the global financial crisis and banks’ financial reporting quality?

As a result of the global financial crisis (GFC), several audit clients were able to negotiate lower audit fees for the years 2008 and 2009. However, the PCAOB has expressed concern that lower audit fees might lead to lower audit effort and lower audit quality and financial reporting quality. This study examines the relation between audit fee cuts and banks’ financial reporting quality. Specifically, we focus on earnings management via loan loss provisions (LLP), the relation between current period LLP and future loan charge-offs, i.e., LLP validity, and the timely recognition of loan losses. For banks audited by Big 4 auditors, we find that income-increasing abnormal LLP are decreasing in audit fee cuts and LLP validity is increasing in audit fee cuts. For banks audited by non-Big 4 auditors, LLP validity is higher for banks that received a fee cut of more than 25% relative to other banks audited by non-Big 4 auditors. We do not observe an association between timely loan loss recognition and cuts in audit fees except for banks audited by non-Big 4 auditors and exempt from internal control audits where a fee cut of more than 25% is associated with less timely loan loss recognition. Overall, the findings suggest that Big 4 auditors constrained earnings management via LLP in banks that received cuts in audit fees. Our findings have important implications for regulators, investors, and others.

The Evolution of Private Equity Fund Terms Beyond 2 and 20

With the remarkable increases in the assets under management of private equity firms, the standard compensation arrangement of a 2% management fee plus 20% carried interest has raised concerns of a misalignment of interests between limited partners (LPs) and general partners (GPs). Using a proprietary data set that includes detailed fund terms of 210 PE buyout funds with vintage years between 1989 and 2012, the authors summarize the findings of their recent study of the evolution of fund terms.The authors report that PE fund terms have been remarkable mainly for their resistance to change, and that the only important force for bringing about reductions in percentage management fees has been the recent increase in fund sizes. But the modest cuts in management fees that have accompanied the increase in fund sizes have done little to address what appears to be a conflict of interest between LPs and GPs over the optimal PE fund size.As one possible solution to this conflict, the authors analyze a recent innovation by Bain Capital that involves considerably smaller management fees (say, 1%) and larger carried interest (as high as 30%). According to the authors, such terms have a good chance of becoming the new industry standard for two reasons: First, LPs have become increasingly “professionalized,” which has led to greater focus on GP compensation and ways of realigning their interests with LPs'. Second, the “signaling” benefits for those GPs willing to distinguish themselves by offering terms like “1 and 30” could encourage more GPs to move in this direction. In the authors' words, “For all but the most reputable and established PE firms, those GPs that do not offer the new terms may well be seen as signaling little confidence in their ability to do what they're being paid to do: namely, produce above‐market returns.”

Government Accepts Higher Work Values for Psychiatry Codes

Government Accepts Higher Work Values for Psychiatry Codes

Is There a Relation between Audit Fee Cuts During the Global Financial Crisis and Banks’ Financial Reporting Quality?

As a result of the global financial crisis (GFC), several audit clients were able to negotiate lower audit fees for the years 2008 and 2009. However, the PCAOB has expressed concern that lower audit fees might lead to lower audit effort and lower audit quality and financial reporting quality. This study examines the relation between audit fee cuts and banks’ financial reporting quality. Specifically, we focus on earnings management via loan loss provisions (LLP), the relation between current period LLP and future loan charge-offs, i.e., LLP validity, and the timely recognition of loan losses. For banks audited by Big 4 auditors, we find that income-increasing abnormal LLP are decreasing in audit fee cuts and LLP validity is increasing in audit fee cuts. For banks audited by non-Big 4 auditors, LLP validity is higher for banks that received a fee cut of more than 25 percent relative to other banks audited by non-Big 4 auditors. We do not observe an association between timely loan loss recognition and cuts in audit fees except for banks audited by non-Big 4 auditors and exempt from internal control audits where a fee cut of more than 25 percent is associated with less timely loan loss recognition. Overall, the findings suggest that Big 4 auditors constrained earnings management via LLP in banks that received cuts in audit fees. Our findings have important implications for regulators, investors, and others.

Reforming Medicare Through ‘Version 2.0’ Of Accountable Care

Medicare needs fundamental reform to achieve fiscal sustainability, improve value and quality, and preserve beneficiaries' access to physicians. Physician fees will fall by one-quarter in 2014 under current law, and the dire federal budget outlook virtually precludes increasing Medicare spending. There is a growing consensus among policy makers that reforming fee-for-service payment, which has long served as the backbone of Medicare, is unavoidable. Accountable care organizations (ACOs) provide a new payment alternative but currently have limited tools to control cost growth or engage and reward beneficiaries and providers. To fundamentally reform Medicare, this article proposes an enhanced version of ACOs that would eliminate the scheduled physician fee cuts, allow fees to increase with inflation, and enhance ACOs' ability to manage care. In exchange, the proposal would require modest reductions in overall Medicare spending and require ACOs to accept increased accountability and financial risk. It would cause per beneficiary Medicare spending by 2023 to fall 4.2 percent below current Congressional Budget Office projections and help the program achieve fiscal sustainability.

Nmc will consider part-timers’ fee cut

Nmc will consider part-timers’ fee cut

Fee Cuts, Eligibility Changes for International Affiliates

You have accessThe ASHA LeaderASHA News1 Oct 2012Fee Cuts, Eligibility Changes for International Affiliates Lily Schuermann Lily Schuermann Google Scholar More articles by this author https://doi.org/10.1044/leader.AN3.17122012.20 SectionsAbout ToolsAdd to favorites ShareFacebookTwitterLinked In Two changes to ASHA’s International Affiliates Program related to fees and credentials took effect Sept. 1, 2012. The International Affiliates Program recognizes the many professionals outside the United States who conduct research, provide services, and teach in training programs in communication sci¬ences and disorders (CSD). Evolving technology allows CSD professionals to share ideas, learn, and solve problems collaboratively with their counter-parts throughout the world, and ASHA welcomes the connection with international colleagues through this program. In an effort to expand the number of international affiliates—and, in turn, increase ASHA members” understanding of CSD challenges in other countries and world regions—the ASHA Board of Directors approved a proposal by the International Issues Board to modify eligibüity requirements. Under the new requirements: The annual fee for international affiliates has been reduced to $75, with an additional $15 fee for processing the new application. Each international affiliate must hold the degree or credential (certification or license) required to practice in the country in which he or she resides. If that country has no such degree or credential requirement, the applicant must provide documen¬tation of at least three years of work experience as a practitioner in audiology or speech-language pathology and a letter of support from the country’s minister of health (or other person of authority) who can verify the individual’s works. Affiliates receive a number of ASHA benefits: Subscription to The ASHA Leader and The ASHA Leader Live. Unlimited access to ASHA’s four online journals. Access to the ASHA website (www.asha.org). Convention discounts. Networking opportunities. Product and service discounts. Eligibility to join any of ASHA’s 18 Special Interest Groups (SIGs). Opportunities to earn professional development hours. Eligibility for nomination as an ASHA Fellow and for the Certificate of Recognition for Outstanding Contributions in International Achievement. ASHA SIG 17, Global Issues in Communication Sciences and Related Disorders (www.asha.org/ SIG/17), is playing an important role in reaching out to SLPs, audiologists, and students worldwide. For more information and updates about the International Affiliates Program, visit www.asha.org/ia. Author Notes Lily Schuermann, Lily Schuermann, director of international programs, can be reached at [email protected]. Advertising Disclaimer | Advertise With Us Advertising Disclaimer | Advertise With Us Additional Resources FiguresSourcesRelatedDetails Volume 17Issue 12October 2012 Get Permissions Add to your Mendeley library History Published in print: Oct 1, 2012 Metrics Current downloads: 71 Topicsasha-topicsleader_do_tagasha-article-typesleader-topicsCopyright & Permissions© 2012 American Speech-Language-Hearing AssociationLoading ...

Return migration of foreign students and non-resident tuition fees

This paper challenges the notion that optimal non-resident tuition fees should necessarily be raised if the return rate of foreign students after graduation increases. The analysis of a host country’s optimal pricing behavior therefore incorporates a specific student migration model. Students usually are aware of the fact that they might return to their home countries after being educated abroad, even if they initially intended to stay on in the host country. With rational expectations, a change in students’ perceptions of the return probability after graduation can affect their first-round decisions whether to study abroad. The optimal adjustment of non-resident tuition fees in the host country has to take this behavioral response into account. Under certain conditions, the behavioral effect is dominant, and a decline in stay rates of students actually requires tuition fee cuts.

Medicare Fee Cut Delayed, but at What Price?

Back to table of contents Previous article Next article Government NewsFull AccessMedicare Fee Cut Delayed, but at What Price?Jonathan WolfeJonathan WolfeSearch for more papers by this authorPublished Online:16 Mar 2012https://doi.org/10.1176/pn.47.6.psychnews_47_6_5-aAbstractThere’s always next year. Brooke Becker/ShutterstockThis seems to be Congress’s mantra when it comes to addressing the sustainable growth rate (SGR) formula that each year calls for larger and larger cuts in Medicare reimbursement to physicians. With Congress’s latest SGR-related vote on February 17, the 27 percent payment reduction scheduled for March 1 is now postponed until January 1, 2013. By that time, however, the mandated cut is likely to be about 32 percent.While the latest in a string of annual delays may be good news for physicians in the short term, the only solution to the problems caused by this long-troublesome formula—and the failure to fix it—according to APA and other medical groups, is a permanent repeal of the SGR formula.“Every year that Congress puts off repealing the SGR just adds to the final cost,” said APA Medical Director James H. Scully Jr., M.D., in a statement following the recent congressional maneuver. “We are also deeply concerned that the ‘doc fix’ is paid for by cutting bad debt and disproportionate-share payments to those hospitals that are caring for the nation’s indigent patients.”Specifically, the latest SGR postponement would be financed by the following health care offsets:$6.9 billion from reimbursing hospitals and skilled nursing facilities that incur debt from treating beneficiaries who do not or cannot pay their share of services.$5 billion from a program created by the Affordable Care Act (ACA) to support prevention and public-health initiatives.$4.1 billion from the Medicaid Disproportionate Share Hospital allotment program.$2.7 billion from clinical laboratory service payments.$2.5 billion from elimination of a fund established under the ACA to support Louisiana’s loss of Medicaid dollars resulting from federal support for Hurricane Katrina recovery efforts.Additionally, Congress has approved discontinuation of the 5 percent “bump” in payment for Medicare psychotherapy services, which was extended several times over the past four years.So, how can the government pay for a permanent fix? Last October, APA joined Reps. Michael Burgess (R-Texas) and Gene Green (D-Texas) in rejecting the Medicare Payment Advisory Commission’s proposal to replace the SGR with a payment structure that would separate primary care clinicians from clinicians providing specialty care.Under that plan, primary care professionals would have seen their reimbursement rates frozen from 2012 to 2022, while specialty care providers’ rates would have declined by 5.9 percent each year from 2012 to 2014 before being frozen from 2015 to 2022.The recommendation of APA, the AMA, and more than 100 cosigning medical groups in a January 23 letter to House Ways and Means Committee Chair Dave Camp (R-Mich.) was that Congress offset the cost of a full SGR repeal with excess funds that had been planned for overseas operations like the wars in Afghanistan and Iraq, which would otherwise go unused.“We agree that our nation faces significant fiscal challenges, and that Medicare is not immune,” wrote APA and its cosigners. “However, it is impossible to implement commonsense programmatic reforms while an immediate and constant threat of massive cuts hangs over the program.”The text of APA’s cosigned letter to Rep. Camp is posted at www.ama-assn.org/resources/doc/washington/medicare-sgr-sign-on-letter-23jan2012.pdf. ISSUES NewArchived

Medicare Agency, Providers Face Challenges This Year

Medicare Agency, Providers Face Challenges This Year

Congress Kicks 27% Fee Cut to March 1

Congress Kicks 27% Fee Cut to March 1