Before the introduction of President Clinton's healthcare reform plan last year, hospital lobbying groups said the worst possible outcome of the reform effort would be huge Medicare cuts without the universal coverage needed to reduce uncompensated care and increase revenues.
Now, after months of debate and untold ups and downs, hospital groups are mounting a fourth-quarter push to avert what American Hospital Association President Richard Davidson called "the worst of all worlds."
Provider groups are kicking themselves after watching the situation get to its current state. One lobbyist who asked not to be identified said provider groups "sort of dropped the ball on this one. We should have been fighting the Medicare cuts more strongly from the beginning."
What happened to get them so worried? It boils down to four things:
The Senate Finance Committee. It passed a bill that includes $55 billion in Medicare cuts over five years without universal coverage.
Senate Minority Leader Robert Dole (R-Kan.). He introduced his own plan that garnered the support of 40 of the Senate's 44 Republicans. It doesn't include universal coverage and is paid for with more than $62 billion in Medicare cuts in the period from 1996 to 2000.
The re-emergence of the moderate coalition in the House. Supporters of the managed-competition act sponsored by Rep. Jim Cooper (D-Tenn.) and supporters of the incremental bill sponsored by Reps. J. Roy Rowland (D-Ga.) and Michael Bilirakis (R-Fla.) have been meeting regularly and sent a letter to Majority Leader Richard Gephardt (D-Mo.) calling for a House vote on a market-based reform plan. Each of those plans has significant Medicare cuts without universal coverage.
The House Ways and Means Committee. While the plan passed by the Ways and Means Committee includes an employer mandate, and is considered to provide universal coverage, it also includes $110 billion in Medicare reductions over a five-year period, a level of cuts Mr. Davidson called "so big they have become bizarre."
None of these measures is by any means a sure thing, but with conservatives and moderates banding together in both the House and Senate, employer mandates-and with them universal coverage-become more difficult to pass.
What most concerns providers is the perception that the link between Medicare cuts and universal coverage-which were interdependent in early proposals such as the Clinton plan-is being severed in Congress. The battle over universal coverage continues to rage, but huge Medicare reductions seem to be a given.
"We are very concerned about the direction Congress is moving," said Daniel Bourque, senior vice president of VHA, the alliance of not-for-profit hospitals. "It's a nightmare for hospitals if we end up with a small reform plan, meaning one that does not include universal coverage, financed with Medicare cuts. At least under universal coverage the money stayed in the system. Without universal coverage, it is just lost."