Congress gave providers an October treat last week as top Republicans began work on plans to boost Medicare payments trimmed under the federal Balanced Budget Act of 1997.
After months of provider lobbying and a rash of studies and postcards, the House Ways and Means health subcommittee on Friday passed a package of adjustments worth $9.4 billion to providers between 2000 and 2004.
The Senate Finance Committee, meanwhile, drafted a bill that offers $9.7 billion in relief to providers. The packages differ in the mechanisms by which they aid providers.
The Finance Committee, expected to vote this week on its package, was meeting resistance from the Senate GOP leadership.
Throughout the year, providers have pushed Congress and the administration to revise the budget act. They argue that the law's payment policies will result in cumulative savings between 1998 and 2002 that are nearly twice as great as the $112 billion originally estimated.
The Congressional Budget Office now estimates savings will be $95 billion more than that as a result of increased compliance with Medicare payment rules and lagging claims processing.
The House bill, which passed the Ways and Means subcommittee, limits hospitals' losses under a prospective payment system for hospital outpatient departments. It also orders HCFA to adjust the qualifying standards for programs to aid rural hospitals, and it delays scheduled decreases in teaching hospitals' graduate medical education adjustments.
The bill designates federal surplus revenues to finance its payment increases. Use of the surplus made the bill a target of Democrats, who tried unsuccessfully to amend the bill so it would pay for Medicare spending increases.
"We will propose that future provider updates be shaved by an amount necessary to offset, with interest, the cost of this bill," said Rep. Fortney "Pete" Stark (R-Calif.). "If we cannot pay for this bill now, before we face the crisis of the baby boomers retiring, it calls into serious question our ability to govern."
In introducing the bill, subcommittee Chairman William Thomas (R-Calif.) pressed the Clinton administration to make regulatory changes to ease the burden of budget-law spending reductions.
Thomas characterized his bill as a $15 billion package because he assumes the administration will make regulatory adjustments worth about $5.6 billion as part of a bargain to improve providers' financial outlook.
"We assume there was a shared responsibility," Thomas said.
White House healthcare adviser Christopher Jennings could not be reached for comment.
