The American Hospital Association last week presented to the National Bipartisan Commission on the Future of Medicare a proposal that would combine Medicare's two parts into one. Not surprisingly, the proposal includes a number of the association's lobbying priorities.
The AHA proposal came in a closed-door session with commission staff, three months after other healthcare organizations presented their plans to the panel at a public hearing.
The commission's administrative chairman, Rep. William Thomas (R-Calif.), publicly singled out the AHA and the American Association of Retired Persons for not presenting plans to the commission at the time other special interest groups did. AHA executives said the nation's largest hospital trade group had not completed a proposal it was working on.
"It was very difficult to achieve a consensus position on what people believe the Medicare program should look like in the future," said Carmela Coyle, senior vice president of advocacy and representation at the AHA.
The AHA's board of trustees approved its proposal for the commission at a Chicago meeting earlier this month. The commission is considering long-term solutions to Medicare's solvency problem. Projections say Medicare will be depleted by 2007.
AHA short-term proposals include:
* Combine Medicare Part A and Medicare Part B to encourage "the coordination of care delivery." Medicare Part A pays primarily for hospital care whereas Part B pays mainly for physician services.
* Increase Medicare managed-care payment rates by infusing new money into the Medicare+Choice program.
* Carve Medicare disproportionate-share payments out of Medicare managed-care reimbursements and funnel the money directly to hospitals.
* Repeal a provision in the federal Balanced Budget Act of 1997 that reduces hospital inpatient payments when a patient is transferred to a post-acute facility before the time has run on an average length of stay for a diagnosis.
* Change the new prospective payment systems for home health, skilled-nursing facilities and rehabilitation services.
* Make graduate medical education funding stable.
The AHA also released a series of "principles" to be included in any long-term Medicare reform plan (See chart).
The most controversial principle calls for revenue increases as part of the formula to increase the financial health of the Medicare trust fund.
"We want to be clear that you can't solve the trust fund's problems solely by reducing payments to providers," Coyle said. "You have to use a multifaceted approach."
The AHA proposes tapping the budget surplus, raising premiums for financially well-off seniors and increasing the Medicare payroll tax.