Instead of its standard pilgrimage to Capitol Hill with lengthy wish list in hand, the American Hospital Association will spend much of its annual meeting this week in Washington educating lawmakers on the value its members provide to their communities.
Last year, hospitals' aggressive lobbying tactics paid off in the form of a Medicare reform law that included increased reimbursement to rural providers and a temporary ban on new specialty hospitals, among other favorable measures. Now, as they prepare to face possible congressional scrutiny of allegedly aggressive billing practices, hospitals are bending over backward to prove they are valuable contributors to society.
To avoid appearing ungrateful for what it has already received, the AHA is making education a centerpiece of its three-day meeting at the Washington Hilton. To kick things off, the association will unveil a study-the second of its kind in recent months-demonstrating how hospitals bring value to their communities and the nation.
The study, parts of which were obtained last week by Modern Healthcare, will show "the economic value hospitals bring in terms of not only being an economic engine in their communities but also the positive return on investment they bring in terms of a healthier society," said Rick Pollack, the AHA's executive vice president. The AHA declined to release the study to Modern Healthcare last week.
The AHA's meeting comes as the House Energy and Commerce Committee continues preparations for a hearing on hospital billing practices involving the uninsured, an issue that heated up earlier this year when HHS Secretary Tommy Thompson told the AHA in a harshly worded letter that there are no federal prohibitions against discounting rates for the uninsured. While no date had been set for the hearing as of last week, lobbyists expect it to take place sometime this month.
Meanwhile, the House Ways and Means Committee is examining 501(c) organizations-including hospitals-and whether they deserve exemptions from federal taxes.
Tax exemptions for charitable or community-based organizations are "not a constitutional right," Ways and Means Chairman Bill Thomas (R-Calif.) said last week, adding that such organizations should be able to prove why it is they qualify for preferential treatment.
On May 3, the AHA's Pollack will join West Virginia Gov. Bob Wise and Joe Krier, president and chief executive officer of the Greater San Antonio Chamber of Commerce, in a press conference to release the new AHA study, which was conducted by the Lewin Group.
A portion of the study contains a chart showing the effect hospital expenditures have on the total output of each state's economy. California hospitals, according to the chart, generated some $103 billion for the state's economy in 2002. California's gross state product exceeded $1.3 trillion that year, according to the state legislative analyst's office.
In New York, the study said, 377,136 people work in hospitals, and they support 9.4% of total nonfarm employment in the state. New York's hospitals generated $76.1 billion for that state's economy in 2002, according to the chart.
In January the AHA and several industry partners collectively known as the Value Group released a similar study finding that although per-capita healthcare costs have increased by $2,254 since 1980, average life expectancy has risen 3.2 years and total annual hospital days have declined 56%. Valuing each one-year gain in life expectancy at $100,000, researchers said every $1 investment in healthcare produces "health gains" of $2.40 to $3 (Feb. 2, p. 6).
"I don't think anybody doubts that," said Tim Rice, president of Lakewood Health System, Staples, Minn., who declined to comment further because he hadn't seen the study.
Health industry lobbyists said the AHA's strategy might well pay off. "Because of Congress' focus right now on jobs on a macro level, the AHA's study is not a bad idea," said Dan Boston, senior public policy adviser for Baker, Donelson, Bearman, Caldwell & Berkowitz, a Washington law firm.
Capitol Hill health policy aides last week said the AHA's strategy makes sense, and that now is a good time to talk with lawmakers about what hospitals provide rather than what they want.
"If hospitals came to the Hill right now and said, `Give us this much more,' they'd get laughed at pretty quickly," a Democratic aide to the Senate Finance Committee said. "But if they say, `Look, these are the good things hospitals do for your district,' that's probably not a bad strategy."
While their emphasis may not be on lobbying, hospital executives will have some requests, among them is that Congress address the growing uninsured problem and restore the temporary Medicaid relief that expires June 30.
The AHA expects roughly 2,000 people to attend its meeting, which will feature addresses by CMS Administrator Mark McClellan and Sens. Rick Santorum (R-Pa.), Hillary Rodham Clinton (D-N.Y.) and John Breaux (D-La.). Breaux, who will receive the Honorary Lifetime Membership Award, was the driving force behind the moratorium on new specialty hospital construction that became part of the Medicare reform law.