Should Medicare compensate hospitals for administratively necessary days?

Days that a patient remains in a hospital due to inability to secure nursing home placement are termed administratively necessary days (ANDs). Some hospitals under Medicare's prospective payment system have incurred discharge delays of this kind. Nursing home bed supply is one major problematic factor; others include adequacy of Medicare nursing home reimbursement rates relative to nursing home costs in an area, the willingness of facilities in an area to serve those needing skilled care, and stringency of relevant Medicaid reimbursement policy. Two promising approaches for dealing with ANDs are increasing nursing home reimbursement rates, and adjusting Medicare payments for exceptionally long-staying patients or those requiring exceptionally intensive care in hospitals.