AHA Comments to MedPAC Re: Topics to be Discussed at the Commissioner’s September Meeting

September 26, 2022

Michael Chernew, Ph.D.
Chairman
Medicare Payment Advisory Commission
425 I Street, N.W., Suite 701
Washington, D.C. 20001

Dear Dr. Chernew:

On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations; our clinician partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the American Hospital Association (AHA) appreciates the Medicare Payment Advisory Commission’s (MedPAC) continued discussions on the Medicare hospital wage index, the prices of pharmaceutical products and the Medicare Advantage (MA) program. As the Commission continues its deliberations, we would like to share our thoughts, suggestions and concerns related to these issues.

Regarding the discussions during the September meeting on the hospital wage index, high drug costs and MA, the AHA:

• agrees that the current wage index system is flawed, but continues to have concerns about using non-hospital data to calculate the wage index;
• presents recommendations to address the skyrocketing cost of drugs, such as a cap on ASP inflation; and
• strongly supports the Commission’s work to monitor the accuracy and completeness of data on MA encounters.

Our detailed comments on these issues follow.