Money took center stage in the national healthcare reform debate as battle lines continued to form over how much reform would cost and who would pay for it.
Arguing over money
Reform debate turns to costs, reimbursement cuts
At the behest of the American Hospital Association, the AHAs state hospital counterparts last week began a targeted campaign to squelch what could amount to hundreds of billions of dollars in White House-proposed reimbursement cuts. On June 13, the Obama administration proposed trimming $313 billion from Medicare and Medicaid over 10 years to help fund healthcare reform. About $220 billion of that is projected to come from payments to hospitals.
The proposed savings would break down in three ways: $110 billion from incorporating productivity adjustments into the way Medicare pays providers; $106 billion by cutting how much the government subsidizes hospitals for treating uninsured patients; and $75 billion by refiguring prices within the Part D program. Another $22 billion would come from implementing payment adjustments recommended by the Medicare Payment Advisory Commission.
Three days later, on June 16, the AHA sent a memo to all of its state associations urging them to ramp up efforts to fight the proposal. The association included specific state-level data on the impact it would have on the local healthcare infrastructure.
This is part of an effort to make sure hospitals understand the impact of these proposals, AHA spokeswoman Alicia Mitchell said.
Its totally counterproductive to what the president wants us to do, said Kenneth Raske, president and CEO of the Greater New York Hospital Association, which represents about 300 hospitals. Raske said the GNYHA would vigorously fight
The Kentucky Hospital Association, meanwhile, sent its members a memo urging them to contact their government representatives and direct them to fight the cuts.
The cost of uncompensated care provided by Kentucky hospitals far outstrips payments they receive under Medicare and Medicaid DSH, the memo states, referring to the disproportionate-share hospital program. The average Kentucky hospital Medicare margin has remained negative for the last five years and has been consistently declining since 2004.
But even at a time when healthcare reform is at the top of the agenda for almost every lawmaker on Capitol Hill, some have hinted that they are less than enthused with the proposal.
Rep. Allyson Schwartz (D-Pa.), a former healthcare administrator who is now helping to shape health reform legislation in the House, said that the White House likely wont get all of their proposed cuts.
Were not going to agree on all of those suggestions, she said. We believe that hospitals should be paid fairly and adequately. We also believe that there are innovative ways we can create financial incentives for improving care.
Meanwhile, leading Democrats continued to try to garner Republican support for separate health reform bills, with mixed results.
Senate Finance Committee Chairman Max Baucus (D-Mont.), who is spearheading what many consider the leading health reform package, met with a handful of GOP members in an effort to shape some proposals that both sides could support.
Emerging from a meeting with a handful of Republicansa group he calls the coalition of the willingBaucus expressed optimism over a compromise. Theres no doubt in my mind were going to have a bipartisan bill, he said.
But in a sign of how difficult the task has so far proven, Sen. Chuck Grassley of Iowa, the leading Republican on the Finance Committee and a close confidant of the chairmans, was less optimistic. Its a work in progress, he said. Im still at the table. I wouldnt be at the table if I didnt think there was some hope for it. But tomorrow could be an entirely different story.
With time running short on a deadline to pass a bill by mid-October, several main sticking points remain. Republicans are still opposed to a public-option insurance plan that would be set up to compete with private payers. A draft Finance Committee report that circulated late last week indicates that lawmakers are working on an effort that could scrap the public option in favor of other proposals that would have greatly limited government backing.
The Senate Health, Education, Pensions and Labor Committee drafted legislation before the Finance Committee, although the plan in the Senate is to merge the two bills.
Republican lawmakers bashed the bill, written by committee Democrats, as being overly expensive and ultimately ineffective.
The committee, chaired by Sen. Christopher Dodd (D-Conn.) in the absence of Sen. Edward Kennedy (D-Mass.), entered into full legislative negotiations with Republicans, who looked to slow the process by offering dozens of amendments.
At issue are debates over cost and coverage. The Congressional Budget Office said that portions of the HELP bill would cost more than $1 trillion while covering only a third of the uninsurednumbers GOP lawmakers seized on in their knocking of the bill.
Additionally, the HELP Committee has yet to release major parts of its bill, including sections that would shape a public health plan and another that would dictate employer participation. The top ranking Republican member, Sen. Mike Enzi (R-Wyo.), called the legislation a partisan bill, adding that if passed, it could lead to rationing in healthcare.
Baucus, who is trying to limit partisan rancor in his committee, said the process is inherently difficult.
This affects every individual American; it affects every business, he said. Congress has never attempted anything as comprehensive as this. I mean, it is just incredibly complex.
This week, the HELP Committee is expected to continue its negotiations on a bill as Republican members plan even more amendments, in part meant to slow the process. After having pushed back a previous timeline in the Finance Committee, Baucus has been more cautious announcing his next steps. That said, a draft version of the bill could come by weeks end.
Democratic members of the Ways and Means, Energy and Commerce, and Education and Labor committees released a draft of reform legislation. The draft includes provisions for a public-option health insurance plan, a requirement that with only few exceptions every American have coverage; and a mandate that employers either offer health insurance or pay a penalty.
Additionally, health insurance companies would be required to accept all comers. The draft includes measures that would bundle payments, try to reduce re-hospitalizations, and replace the sustainable growth-rate formula. Overpayments to private plans that participate in the Medicare Advantage program would also be eliminated, according to the preliminary draft.
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