Although it's using the financial woes of rural hospitals to campaign for increased Medicare payments, the American Hospital Association is not fully embracing a rural hospital relief package.
Saying the legislation needs to be altered, the AHA is supporting only select provisions of rural Medicare-relief measures sponsored in the House by Jim Nussle (R-Iowa) and in the Senate by Max Baucus (D-Mont.).
Those bills are backed by the National Rural Health Association, which represents about 800 rural hospitals, as well as clinics, physicians and academicians.
NRHA executives declined to comment on the AHA's position, but sources said the NRHA is miffed at the AHA's actions, calling them hypocritical given that group's lobbying theme.
But AHA officials argue that their organization is fighting for urban and rural hospitals alike when it pursues its broader agenda to change federal reimbursement policies, so it's fair to cite the specific problems of rural hospitals when campaigning for such changes.
The AHA opposes one provision in the House bill that AHA officials said would further subsidize rural hospitals by billions of dollars per year.
The provision would make it easier for hospitals to qualify as "Medicare-dependent, small, rural" facilities (See chart).
"That's not the best policy," said Diane Major, the AHA's senior associate director for federal relations. "You could have the whole state of Kansas declared Medicare-dependent hospitals."
The AHA, meanwhile, objects to the Senate bill because it doesn't contain a repeal of cutbacks in hospital payments for patients in 10 DRG classifications who are transferred to post-acute-care settings. The AHA has made the repeal a top legislative priority.
"There are lots of good provisions in each of these bills, but for some reason they were not adopted by one (sponsor) or another," Major said. As a result, she said, "We haven't been able to offer umbrella support" to the rural bills.
The AHA and the NRHA may be fighting for the same dollars. Like the proposed change in the rural hospital subsidies, the proposed repeal of the payment cuts for post-acute transfers could increase Medicare costs by billions of dollars per year. When the Balanced Budget Act of 1997 was enacted, the Congressional Budget Office projected the provision AHA wants repealed would save $3.7 billion over five years.