Editor's note: This is an expanded version of the story that appears in the Jan. 12 issue of Modern Healthcare magazine.
Hospitals can expect another year of increased pressure to improve accountability and quality despite the many question marks that surround the new administrations approach to regulatory policy.
The industry for the most part has high hopes for President-elect Barack Obama and the new team of health regulators hell be bringing to his administration. While no one really knows how Obama will approach all hospital issues on the regulatory front, the industry is banking on a kinder, gentler administration to meet it halfway on Medicare payment issues and other concerns.
Something that was inconsistent in the Bush administration was the level of communication related to direction on regulatory policy, says Blair Childs, a spokesman for group purchasing organization Premier. The financial pressures on healthcare are so huge, its imperative that we increase the drive toward improving quality, which we have learned can also reduce costs.
The Federation of American Hospitals in particular is encouraged by the nomination of Tom Daschle as HHS secretary and the fact that hes also heading the new White House Office on Health Reform. Hes a thoughtful leader whos long been supportive of hospitals and the need to address the crisis of the uninsured, says Steven Speil, the federations senior vice president of health finance and policy.
The industry is banking on that type of insight with a number of issues that could affect their livelihood. One of the most urgent issues of concern for 2009 is a moratorium thats set to expire March 31 on a series of Medicaid regulations that hospitals believe could potentially jeopardize care and trim billions of dollars from the program.
Last year, Congress approved a law that put a hold on the regulations, which among other things would limit payments to safety net facilities, cut funding for graduate education programs, and refigure provider taxes that are used to help offset Medicaid expenses. They would also limit funding for rehabilitation services, certain case-management programs and school-based transportation.
Its unclear, however, how Obamas new administration will handle these rules, says Don May, vice president of policy with the American Hospital Association. The question is: Will Obamas administration withdraw the rules, withdraw and reissue new rules, or let the rules go into effect after the moratorium ends? With no action from the new administration, a legislative fix would be needed. I should note that Congress has been supportive of blocking these regulations, he says.
A report from Rep. Henry Waxman (D-Calif.), now chairman of the House Energy and Commerce Committee, has estimated that the five-year cuts to the Medicaid program for implementing these rules could be more than $30 billion. The AHA estimates the regulations could significantly affect hospitals.
One way or another, wed like to see those regulations disappear, Speil says.