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Hill hears call to protect hospital care

March 21, 2014

With Congress looking for ways to pay for a physician payment fix by the end of the month, the AHA and hospital leaders stepped up their efforts to persuade lawmakers to reject further reductions to hospital payments that would hurt patients’ access to care.

As part of those advocacy efforts, hospital leaders met with lawmakers on Capitol Hill, and the Coalition to Protect America’s Health Care launched a new TV ad highlighting concerns about cutting funding for hospital services.

The AHA hosted a March 11 Advocacy Day briefing that
brought hospital leaders from across the country to the nation’s capital. After a briefing on the latest legislative developments around hospital issues, hospital leaders took their concerns directly to legislators and staff on Capitol Hill.

Hospitals’ legislative agenda.


Hospitals leaders are pushing Congress to support an agenda that protects hospital payments – always at risk for cuts as an offset for fixing physician payments.

They also urge legislators to extend expiring Medicare provisions that are important to rural hospitals; and to provide relief from the Centers for Medicare & Medicaid Services' "twomidnight” admissions policy, the 96-hour physician certification requirement for critical access hospitals, and the direct supervision policy for outpatient therapies, as well as the growing number of recovery audit contractors' audits and denial of payments on Medicare claims submitted by hospitals. Support for hospitals' advocacy message came by way of a new coalition TV ad launched March 17. The ad shows public reaction to the idea of additional cuts to hospital services, and features people sharing their opinion about how cuts to Medicare and Medicaid payments for hospital services would affect patients. The AHA is a founding member and strong sup- porter of the 14-year-old coalition.

The ad is part of the coalition's major new "Stop Hospital Cuts" campaign launched earlier this month that includes print ads at two Metro stations near Capitol Hill. The campaign is intended to "remind Congress that there is never a right time to cut funding for patient care,” said coalition chairman Jim Skogsbergh, president and CEO of Advocate Health Care in Downers Grove, Ill., and an AHA board member.

Deadline for action on SGR. This month's advocacy push leads up to the March 31 deadline for Congress to pass legislation to avert a 24.4% payment cut in physician's Medicare payments. Flaws in Medicare's sustainable growth rate (SGR) formula for reimbursing physicians, enacted as part of the 1997 Balanced Budget Act, have led Congress through the years to adopt a series of short-term patches so it could avoid cutting physicians' payments.

Through a series of complicated calculations, the SGR formula in effect means that if spending due to increased use of services by Medicare patients rises faster than the nation's gross domestic product (GDP), Medicare must compensate by cutting reimbursement rates for physicians enough to bring spending back in line with GDP growth.

Overhauling the SGR formula has been a long-standing priority for Congress. The House March 14 voted 238-181 to approve legislation, the SGR Repeal and Medicare Provider Payment Modernization Act, H.R. 4015, that would repeal and replace the SGR formula for Medicare physician payment updates, and offset the $138 billion cost of the policy changes by suspending for five years the Affordable Care Act's tax penalty on individuals who go without health insurance.

The proposed offset drew sharp criticism from House Democrats.

The president promised to veto the bill if it reaches his desk. The Senate could vote on a different version of the bill later this month. With the exception of the payment offset, the House-passed bill is similar to the SGR replacement bill unveiled by congressional leaders last month. It would provide a 0.5% payment update for five years under the fee-forservice model as a transition and allow further updates if needed.

The Congressional Budget Office projects the House bill would increase by 2018 the number of uninsured Americans by about 13 million and premiums by 10%-20%.

The AHA has urged Congress to fix the physician payment formula, but not by reducing payments for hospitals services.

Health care spending growth at record low. Meanwhile, an AHA infographic, released during last week's Advocacy Day meeting, depicts the record low growth in health care spending over the past four years, driven in part by low growth in hospital prices.

"These trends are leading to an improved long-term federal budget outlook,” the infographic notes. "The Congressional Budget Office projections of future Medicare spending from 2014 through 2020 are down by more than a half a trillion dollars. Health care cost growth typically slows during recessions, but the continuation of this trend well into the recovery suggests more factors at hand. A growing body of recent research points to the impact of structural changes in how health care is delivered and financed." See the infographic below.