An American Hospital Association study released last week asserts that Republican budget-cutting plans will hurt providers without doing much to save the Medicare program.
The report was issued as lawmakers were finishing their July 4 recess and returning to Capitol Hill to work out the details of their spending blueprint. The AHA contends the GOP budget passed in late June might help reduce the budget deficit but won't achieve the party's stated goal of rescuing the financially strapped Medicare trust fund.
If Medicare hospital spending were increased enough to cover both enrollment growth and general inflation, Medicare would save only $24 billion over seven years-far short of what's needed, the AHA said.
The study also found that if hospital growth were held to an average annual rate of 1.4%-barely enough to cover the expected growth in Medicare enrollment but not inflation-$110 billion would be saved.
The release of the AHA study came as Democrats and Republicans spent the holiday recess in their home districts holding town meetings on Medicare and lobbing bombs at one another.
Democrats settled on a strategy of calling the GOP budget plans extreme and radical. A recent House Democratic Leadership document urges members to call the GOP Medicare cuts a "stealth attack on Social Security benefits."
Meanwhile, GOP leaders spent the week pushing their message that the $270 billion in Medicare spending reductions in their seven-year budget were needed to save the Medicare trust fund.
The Congressional Budget Office projects that without any changes by lawmakers, Medicare spending will increase at an average annual rate of more than 10%, to more than $325 billion by 2002 from $175 billion this year.
The GOP plan would hold the yearly increases to about 6%.
But AHA officials argue that their study debunks the GOP assertion that the Medicare spending reductions will extend the life of the trust fund.
"The spin that (Republican leaders) are putting on this, that they are saving the trust fund, has worked very well but you have to dig deeper," said Richard Pollack, AHA executive vice president for federal relations.