Hospitals and other healthcare providers won considerable Medicare givebacks from Congress this year, and many of them say they will come back for more next year.
That may be a tougher sell during an election year, given the amount of relief in the budget legislation for fiscal 2000 that President Clinton expects to sign into law this week, as well as the number of pork-barrel projects hospitals received this year.
The legislation includes $18.1 billion over five years in Medicare payment relief for providers and health plans.
The package of five budget bills, which the Senate passed Nov. 19, reverses or postpones Medicare payment reductions imposed by the Balanced Budget Act of 1997. The House approved the same legislation Nov. 18 (Nov. 22, p. 3).
The anticipated signing will end one of healthcare's most arduous lobbying campaigns in the past two decades.
The American Hospital Association spearheaded an aggressive and public lobbying campaign called "Real Pain for Real People," which consisted of flooding media and politicians' offices with anecdotes about struggling facilities.
The AHA also brought hospital executives to Washington to speak with lawmakers about how the budget law was affecting hospital operations.
For its part, the American Medical Association quietly but persistently lobbied all year for changes in the formula that determines the increase in Medicare spending on physician services. The AMA and other physician groups won a victory by getting the changes put into this year's budget package.
The American Association of Health Plans, while dueling with the AMA over managed-care reform legislation, also held numerous press briefings about withdrawals from the Medicare managed-care program, Medicare+Choice. The AAHP also brought seniors enrolled in Medicare HMOs to Washington for a rally to financially bolster Medicare+Choice.
Some payment increases in the bill read almost verbatim from healthcare lobbyists' wish lists, and include:
* The elimination of the 5.7% across-the-board reduction in Medicare payments for hospital outpatient services, worth $3.6 billion.
* A freeze in scheduled reductions in payments to teaching hospitals for the indirect costs of medical education, which means the 1999 payment rates will be used for 2000. The payment rates will drop slightly in 2001 before falling in 2002 to the rates prescribed by the budget law. The freeze will save teaching hospitals $600 million.
* A grant program through which rural hospitals can receive up to $50,000 from HHS to help them comply with requirements of the budget law. Other rural hospital relief totaled $800 million.
* Bonus payments to Medicare managed-care plans that move into markets that have not offered a plan since 1997. That's part of a $4 billion package for Medicare HMOs.
* A one-year delay in the scheduled 15% reduction in home health payments. The bill also requires the Medicare Payment Advisory Commission to study whether to exclude rural home health agencies from the prospective payment system. The delay saves home health providers $1.3 billion.
* A 20% increase in payments for skilled-nursing patients who require more intensive services. The increase will stay in place for at least six months until HCFA refines the payment system. That relief, plus special payments to homes that care for a large number of AIDS patients, are worth $1.4 billion.
* Modifications to the formula used to update physician payments, which will result in more stable and accurate payments. Physicians say they lost $3 billion last year from flaws in the formula.
"All hospitals did OK," said Thomas Scully, president of the Federation of American Health Systems, which represents for-profit chains. "The teaching hospitals did really well. You could say the money was a little light on the rural side, because there were some fixes that didn't happen this year."
The bill also lays the groundwork for Medicare-risk plans that want HCFA to make changes in the so-called "risk adjuster," which is supposed to direct more Medicare dollars to plans with sicker members.
The changes could funnel up to $9 billion, which HCFA initially counted as a savings for Medicare, back to the HMOs.
The AHA lauded Congress and the White House for their work on the relief package but said the generous provisions still won't satisfy their members.
"With many hospitals still facing financial disaster, the fixes aren't complete," said Richard Davidson, AHA president, in a written statement. "We continue to view this only as a first step, and will work with Congress and the administration to further restore the necessary Medicare funds so that hospitals can continue providing quality patient care."
The Catholic Health Association echoed that sentiment.
"Given that our entire healthcare system is in deep financial trouble, which threatens access to fundamental patient care, we strongly urge Congress to revisit this issue in January," said the Rev. Michael Place, the CHA's president and chief executive officer, in a written statement.
"I am grateful for what Congress did," said the federation's Scully. "I would love to have more, but I'm going to wait to hear from my members before I do anything (further)."
