We beg to differ with David Burdas take on Sen. Chuck Grassleys (R-Iowa) efforts to improve the Medicare system (The senator will see you now, Aug. 4, p. 23). As the chief executive officer and chief financial officer of one of Americas rural tweener hospitals, we believe that creating a new Medicare Part A category is essential to the health of Medicare-dependent hospitals such as Grinnell (Iowa) Regional Medical Center.
We are paid by Medicare at only 67% of our cost to take care of two-thirds of our patients. Considering the national average Medicare reimbursement rate is about 95% and our care is consistently recognized as some of the highest quality in the nation, it is discouraging at best to read that we are somehow asking for more than our fair share by wanting to be paid closer to the national average.
When Medicare is paying hospitals in the most expensive states up to 70% more than Iowa hospitals, you have to believe that Medicare needs to be questioning its payment process. Our economy cannot support inefficient and ineffective care. This years Dartmouth Institute for Health Policy and Clinical Practice study proves that here at Grinnell Regional we have the cost-quality formula rightand its where healthcare needs to go in the future.
In a recent Commonwealth Fund study, Iowa ranked second best in the nation for highest quality, lowest cost and best access. Grinnell Regionals costs are 30% below the national average, and we are only paid at 67% of our costs to care for Medicare patients. We have had to make do with less, but we certainly cant continue to be the hospital we are at this rate. We would be the first to sign up for a Medicare payment system that rewards best outcomes and efficiency.
With fewer medical students going into primary care, and even fewer wanting to practice in rural areas, Medicare underpayment affects physician recruitment in addition to a hospitals fiscal health. Medicare underpayment received by middle-sized rural healthcare providers compels physicians to be efficient and judicial in usage of diagnostic tests, services and experimental treatments.
It would take money to pay tweener hospitals more, and in Washington that means offsets. The Congressional Budget Office indicates physician-owned specialty hospitals cost Medicare more than community-owned hospitals and are therefore a reasonable target for reducing Medicare spending and making payment to tweeners more equitable.
Burda asks whom we trust more: physicians, hospital administrators or Grassley? He needs to be more precise with his question. Do we trust the physician at a community hospital governed by local citizens seeking the best for their area or a physician who owns the hospital with obvious financial incentives, rewarded for self-referral with little checks or balance?
As for Grassley, who led the charge to clean up the defense industry more than two decades ago, he simply wants to be certain the taxpayers get the best value for care they receive, something more legislators should be striving to do.
We suggest to Burda that part of the reason why the financial demise of Medicare is looming in the very near future is the fact that Medicare is still paying for unnecessary procedures, medical errors, and vendor contracts written to keep payers in the dark. Burda indicates it is only politicians and hospitals complaining about physicians. In reality, Americans are complaining about cost, quality and access. They are blaming all of us. We all have work to do and need to work together for better payment systems, appropriate incentives, level playing fields, greater transparency and a focus on value.
President and chief executive officer
Vice president, chief financial officer
Grinnell (Iowa) Regional Medical Center