President Clinton and Republican leaders were close to an agreement last week that would give $1 billion to $2 billion more in new Medicare payments to rural hospitals and other providers in the next five years.
The efforts, made as Congress tried to adjourn for the holidays, could push the total tab of federal healthcare legislation to more than $34 billion, with as much as $13 billion designated for hospitals.
Clinton last week pushed for as much as $800 million in additional Medicare spending for rural hospitals and an undetermined amount for hospices and rural home health agencies. In addition, Clinton asked that Medicare HMOs be prohibited from pulling out of service areas for at least two years.
After nearly two months of stalemate, Clinton and Republican congressional leaders moved closer to an agreement on legislation that would ease Medicare and Medicaid spending restrictions imposed by the Balanced Budget Act of 1997. It's expected to be part of legislation setting annual spending for HHS.
The measure had been contained in tax-cut legislation that passed the House but never faced a Senate vote. Clinton had threatened to veto that bill in part because he said the $10.1 billion it earmarked for Medicare HMOs was too high.
The two Oval Office meetings with Senate Majority Leader Trent Lott (R-Miss.) and House Speaker J. Dennis Hastert (R-Ill.) broke the logjam. Provider group lobbyists said last week that White House and congressional aides were expecting to work all weekend to seal a deal as soon as this week.
"The process continues to be slow, but we're inching closer," said Herb Kuhn, vice president of advocacy at the Premier hospital alliance. "Congress does seem absolutely committed to resolving the (Medicare) issue this year."
"They're knocking down a lot of barriers," said Richard Pollack, executive vice president of the American Hospital Association. "Things seem to be coming together, and things appear to be on track for an agreement."
Hospital executives helped to spur the talks. The AHA brought in at least 100 to meet with lawmakers in their last-ditch effort to get the legislation passed.
In addition, executives of hospitals, home health agencies and nursing homes appeared at a bipartisan forum in a Senate office building to press their case.
"Faced with a gigantic budget deficit . . . we're cutting site services," Peter Levine, M.D., president and chief executive officer of UMass Memorial Health Care in Worcester, Mass., told senators at the forum. So much so the hospital is even laying off chaplains (See story, p. 28).
The added Medicare spending for hospitals discussed last week would come on top of the $12.3 billion in a bill to increase total Medicare, Medicaid and State Children's Health Insurance Program spending by some $32.6 billion between now and 2005.
The legislation follows on the heels of a law passed last year that increased spending for Medicare, Medicaid and SCHIP by $16.1 billion between 2000 and 2004. Of that, hospitals received about $7 billion.