Hospitals, long-term-care facilities and other providers emerged as winners from an otherwise thin Medicare bill, while physicians were left to grouse over a short-term pay fix that Congress granted them as it raced to a close last week before the holidays.
First and foremost, the $4.6 billion bill, which by midweek had cleared all congressional hurdles en route to the White House, temporarily reverses what would have been about a 10% Medicare pay cut to doctors and provides an extension of the State Childrens Health Insurance Program through early 2009. President Bush is expected to sign the bill into law.
Hospitals won a hard-fought measure that will allow them to recoup more dollars for their inpatient rehabilitation patients and the industry was able to stave off pay reductions that were slated for 2008. The bill also extends several rural health provisions meant to aid small, out-of-the-way hospitals. And long-term, acute-care hospitals, which were expecting to see their payments on the chopping block, dodged that bullet after lawmakers gave them a reprieve.
Yet while both of those initiatives headlined the broader legislative package, industry veterans said that the final product left them feeling jaded, not jubilant. Doctors, who for years have sought a long-term fix to their outdated payment form-ula, instead saw only a six-month patch. Hospitals, too, didnt win on all fronts. For instance, lawmakers didnt include a provision that would have put a moratorium on physician-owned specialty hospitals.
Though the bill replaces what would have been a steep cut to doctors reimbursement with a 0.5% pay increase through June 30, 2008, several physicians groups registered complaints. Edward Langston, board chairman for the American Medical Association, called the physician pay patch extremely disappointing, saying that the six-month fix, creates uncertainty for both Medicare patients and physicians. Earlier legislative blueprints called for a one- to two-year pay fix, but party-line haggling and tight budget restrictions ultimately made that impossible.
As is, fixing the Medicare physician payments for the short term will cost the agency $2.7 billion. Longer-term fixes would have come with a much bigger price tag.
The move also forces lawmakers to once again take on the issue of physician payment almost immediately when they return to Capitol Hill next month.
CMS acting Administrator Kerry Weems during a news briefing chided members of Congress for making only nips and tucks to what he said should be an overhaul to the sustainable growth rate formula, which dictates what Medicare pays doctors.
I encourage Congress to step back from it all and not just tweak this or tweak that, Weems said.
Even members of Congress struggled to put a happy face on the billwhile others didnt even try. What we have before us gives the lowest-common denominator a bad name, said Rep. Pete Stark (D-Calif.), chairman of the House Ways and Means Health Subcommittee.
The House originally passed a thicker Medicare reform package that rode along with an expansion and reauthorization of SCHIP, but watched as it got whittled down over tough negotiations with Republicans and White House aides.
The bill is a far cry from earlier blueprints that would have cost tens of millions of dollars. Lawmakers plan to pay for the legislative package, in part, by drawing $1.5 billion out of the Medicare Advantage stabilization fund.
Hospitals emerged from the bill with some clear gains. The bill rolls back to 60% the compliance threshold for inpatient rehabilitation services. The current percentage was 65%, but set to go to 75% next year. The number represents the minimum percentage of a hospitals patients that must have one of 13 medical conditions requiring intensive multidisciplinary inpatient rehabilitation. If the percentage is met, the facility would then qualify for higher reimbursement.
It also extends several rural hospital and physician provisions that were set to expire but that also proved important to the Senate leaders who crafted the bill. One provision, for instance, would extend funding for bonus payments to doctors who practice in shortage areas.
But the bill doesnt put a block on physician-owned, limited-service hospitals that the American Hospital Association lobbied for, nor does it extend a program that gives public hospitals a higher reimbursement rate.
Richard Pollack, the AHAs executive vice president, called the bill a mixed bag, adding that several hospital-friendly provisions would be kicked over until next year. Next years agenda is sort of this years agenda, he said. A lot of the issues carry forward.
Other provider groups also dodged bullets. LTACs got what one healthcare lobbyist called a complete rescue package after seeing that Congress would not cut its reimbursement rates. Home health providers, nursing homes and home oxygen suppliers can also claim victories since their base rates avoided the scalpel as well. Previous versions of the bill that made its way through the House would have cut payments to them.
The provision to extend SCHIP through March 31, 2009, however, earned groans from lawmakers, who pledged to more fully fund the program for a longer period.
Senate Finance Committee Chairman Max Baucus (D-Mont.), who sponsored the bill, lauded many of the extenders, but added that the legislative package is unfinished. The committee will move aggressively on broader Medicare reform in the next session of Congress, he said in a written statement. Changes that make every part of Medicare better for seniors are sorely needed.