Urban Hospitals Win Challenge to Medicare Payment Formula Change

A change in Medicare’s payment formula that resulted in lower reimbursements for some urban hospitals violated the Medicare statute, a federal district court ruled.

The change, released for fiscal 2020, was designed to to prevent hospitals from manipulating the mechanism by which payments are adjusted to reflect wage differences between rural and urban areas. But the law didn’t license the Department of Health and Human Services to fix anomalies rooted in statutory provisions, the U.S. District Court for the District of Columbia said April 8.

“A court cannot ‘set aside a statute’s plain language simply because the agency thinks it ...