U.S. Department of Health and Human Services Secretary Alex Azar criticized the current Medicare area wage index system during a hearing of the Senate Finance Committee last week.
Reminding senators that he told them last year that they need to revise the system and warning that HHS’s ability to change it is limited without legislation, Azar referred to the system as an “absurdity” as individual senators pointed out what they view to be inequities in the system that hurt hospitals in their own states.
Medicare’s area wage index system adjusts Medicare payments to hospitals based on geographic differences in the cost of labor.
Learn more about the criticisms that Azar and Senate Finance Committee members registered about Medicare’s area wage index system in the Modern Healthcare article “Azar calls out ‘absurdity’ in Medicare wage index.”