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Advising the Congress on Medicare issues
MedPAC > News > General announcements > Payment Basics: A Traveler’s Guide to Medicare’s Payment Systems

Payment Basics: A Traveler’s Guide to Medicare’s Payment Systems

MedPAC’s mission is to advise the Congress on Medicare issues. Part of this role is making recommendations to the Congress and the Secretary of HHS, but another key piece is providing clear and accessible information about how Medicare works.

Medicare has more than 20 distinct systems for paying health care providers who serve Medicare beneficiaries. Even we’d admit that it’s a lot to keep up with. Have you ever mixed up the Practice Expense RVU with the Work RVU in the physician fee schedule? Wondering what causes a nursing facility case to be classified in a given RUG? Can’t remember how the add-on payments to the inpatient hospital DRGs work? Are you completely overwhelmed by the payment system alphabet soup?

MedPAC has the cure for what ails you: Payment Basics.

Payment Basics is a series of explainers on how Medicare’s payment systems function. These “basics” are typically no more than 5 pages long and feature handy diagrams that visually depict how the payment systems calculate providers’ payments. 

MedPAC produces “basics” for all the major payment systems and updates the series once a year in the fall – and the updated versions are now posted.

Check them out here.