In June of 1993, as Congress debated the Clinton administration's budget package, the Senate Finance Committee proposed a plan that included nearly $100 billion in Medicare spending cuts over a five-year period.
As it had in the past, a coalition of provider groups, seniors advocates and labor groups fought the reductions.
Arguing that cuts of that magnitude would not only exacerbate cost-shifting but also make it impossible to achieve healthcare reform, the groups eventually got the reductions whittled down to $56 billion-almost half the original level. But it was one of the toughest budget fights in recent memory.
In 1995, Congress is likely to be more conservative and more deficit-
conscious. With hopes for comprehensive healthcare reform now a distant memory, it's more difficult to argue that Medicare spending should not be reduced to hold the savings for healthcare reform. Furthermore, the traditional coalition that fought Medicare reductions was frayed during the reform debate.
Those problems, coupled with a recognition that the universe of potential avenues for cost-shifting are drying up, have the American Hospital Association and other provider associations searching for new strategies to combat Medicare and Medicaid spending reductions.
"I agree that it is probably not going to be enough to just say to a member (of Congress), `Don't cut Medicare,' like we have in the past," said Brent Miller, director of government relations at the American Group Practice Association. "We are going to have to find a much better argument than that because (Congress) is going to be under pressure to cut the deficit."
For years, providers have argued that Medicare reductions will result in reduced access for beneficiaries. However, the Physician Payment Review Commission annually reviews beneficiary access and has yet to find anything more than isolated incidents of providers not accepting Medicare patients.
"Until the hospital industry begins shuttering (hospitals) or we really begin to see access being denied, Congress is going to continue to believe providers can absorb more cuts," said a healthcare industry lobbyist who asked not to be identified.
New game plan.The AHA is actively considering several new lobbying strategies, according to its president, Richard Davidson.
"We have to get the message across (to Congress) that it is no longer acceptable to get in a back room and invent a (Medicare reduction) number that has no relationship to rational healthcare policy," Mr. Davidson said.
One strategy under consideration is to convince Congress that the Medicare issue should be separated from other budget issues.
"If we can narrow the focus to just Medicare, we might have a better chance than we would have otherwise," Mr. Davidson said.
One way to do that, according to Richard Pollack, executive vice president of federal relations for the AHA, would be through the creation of a quasi-governmental commission with authority to structure the Medicare benefits package.
Under the plan, Congress would determine a budget for the Medicare program. The commission would take that budget and recommend a Medicare benefits package that would not exceed the budget but still give providers a reasonable reimbursement.
Trust fund focus.Another strategy under consideration by the AHA would be to focus on the solvency of Medicare's financial underpinning, the Health Insurance Trust Fund.
"If we can get Congress to look at keeping the trust fund viable for our children and grandchildren, then maybe we can get them to look at long-term issues rather than short-term deficit reduction," Mr. Pollack said.
Other groups say they'll push for some increase in Medicare benefits, such as an outpatient prescription drug benefit, to divert money into the system in other ways.
The American Association of Retired Persons endorsed several healthcare reform plans that included long-term-care or prescription drug benefits in exchange for Medicare cuts, according to Martin Corry, AARP director of federal affairs.
Mr. Corry said that while AARP will continue to oppose any cuts, it also will make it clear to Congress that cuts in the context of systemwide cost containment and increased benefits are more acceptable than cuts that go for deficit reduction.
According to William Cox, vice president of governmental services for the Catholic Health Association, providers also are looking to re-establish some of the traditional anti-Medicare cut coalitions.
However, many of those alliances were strained over the past year during the healthcare reform debate.
"The normal coalitions against Medicare cuts have kind of dried up," Mr. Pollack said.
That may lead to the formation of new coalitions with employers or other organizations.
"I think we need to bring our friends from business along next year to argue that Medicare cuts are just shifting costs and not really saving the overall system any money," Mr. Miller said.