As Congress pushes forward with its effort to use more than $10 billion in federal surplus for extra Medicare payments to healthcare providers over the next five years, individual hospitals also are cutting their own deals to evade HCFA rules and boost their payments.
"The reality is that you're always going to have that occur," said Richard Pollack, executive vice president and director of government and public affairs at the American Hospital Association. "We're (only) against the fixes that are done in a redistributive way."
Tucked away in Senate legislation to roll back payment policies imposed by the Balanced Budget Act of 1997 are provisions that help two hospitals in Mississippi, home of Republican Majority Leader Trent Lott, who also sits on the Senate Finance Committee, which has authority over Medicare.
Lott's office did not return telephone calls seeking comment.
Forrest General Hospital in Hattiesburg, Miss., would avert the loss of some $1.6 million in federal fiscal 2000 under the bill the Senate Finance Committee passed.
The legislation calls for the urban-labor-cost data of 211-bed Wesley Medical Center, the only other hospital in Hattiesburg, to be factored into the inpatient reimbursement calculations for Hattiesburg, which would benefit Forrest General.
HCFA has reclassified Wesley Memorial, owned by Quorum Health Group of Brentwood, Tenn., into the Biloxi, Miss., metropolitan area for purposes of Medicare reimbursement.
The absence of its labor-cost data in calculating reimbursement for 537-bed Forrest General caused its payment rates to drop to the floor for rural Mississippi hospitals effective Oct. 1.
Under the budget law, Forrest General already stood to lose $10 million per year during the next four years, said Jeffrey Moore, a lawyer who represents Forrest General and is in the Tupelo, Miss., office of Phelps Dunbar.
"It's their way of making us whole," Moore said. "We can't absorb another $1.6 million (cut)."
Another Mississippi hospital protecting itself from losses is 195-bed Northwest Mississippi Regional Medical Center in Clarksdale. The Health Management Associates-leased facility was on the verge of losing its status as a "rural referral center," which allows big hospitals in rural areas to appeal for more-lucrative payments in nearby cities.
Because it lost an ear, nose and throat specialist, Northwest Mississippi saw a decline last year in the average complexity of the patients it treated, which is one criterion hospitals use to qualify as rural referral centers.
Keeping the rural referral center status is worth $3 million per year to the facility, said John Faulkner, the hospital's executive director.
The Senate bill would exempt Northwest Mississippi from the requirements of the budget law for a year. Faulkner said patient complexity has risen again to exceed the threshold necessary to qualify. The one-year exemption will eliminate the need for the hospital to reapply.
The Senate provision also would provide higher Medicare inpatient payments to hospitals in two counties-Iredell County, N.C., and Orange County, N.Y.
Orange County's six hospitals would be paid the rate to facilities in New York, and Iredell County's three hospitals would be paid the same as facilities in Charlotte, N.C.
Hospitals in both counties argue that they're competing for employees with hospitals in the neighboring urban areas and need the higher payments to attract qualified workers.
Meanwhile, the Senate has passed spending legislation for HHS urging HCFA to fund several hospital-based research projects.
Among them are a congestive heart failure project being proposed by the University of Pennsylvania, the University of Louisville and Saint Vincent Hospital and Health Center in Billings, Mont.