Action Alert:Federal Cuts to Medicare and Medicaid Hospital Payments

Congress has returned to Washington and we need your help to urge them not to cut payments for hospital services. Before the end of 2011, the House and Senate passed a two-month extension of the current Medicare physician payment rates. Their action prevented a 27.4 percent cut to Medicare physician payments that had been scheduled to take effect Jan. 1. The bill also included an extension of the health care “extenders” set to expire and the Social Security payroll tax holiday and emergency unemployment insurance benefits. This bill did not include any cuts to hospital payments.

The two-month extension will expire Feb. 29, forcing Congress to identify offsets to finance these programs. Hospital payments will again be on the chopping block. During the December negotiations, issues of serious concern to hospitals included:

• Reductions in payments to hospitals for assistance to low-income Medicare beneficiaries (bad debt);
• Reductions in payments for evaluation and management (E/M) services provided in hospital outpatient departments;
• Extending the current cap on therapy services - and the exceptions process to it - to those services provided in hospital outpatient departments (this currently applies only to services provided in nursing homes and other freestanding settings);
• Significantly weakening the prohibition on the establishment of new physician-owned specialty hospitals, and relaxing the restrictions for growth on those that exist; and
• Providing the Centers for Medicare & Medicaid Services with new authority to make additional across-the-board cuts to Medicare inpatient hospital rates through the use of retrospective coding adjustments for fiscal years 2010, 2011 and 2012.

In addition, the Middle Class Tax Relief and Job Creation Act of 2011 (HR 3630) approved by the House of Representatives includes $20 billion in cuts to hospital payments with an estimated impact of $187 million over the next 10 years for South Carolina hospitals.  This proposal remains on the table as the House and Senate work out their differences before Feb 29.

How can you help?

Please contact your legislator and ask them to oppose any cuts to payments for hospital services. Hospitals support eliminating the scheduled reduction in Medicare payments to physicians, but not by reducing payments to hospitals. The American Hospital Association has provided a list of alternative options to reducing hospital payments for consideration. Please share these ideas as well with your legislators. Over the next decade, hospitals in South Carolina anticipate more than $5 billion in Medicare and Medicaid payment reductions. Hospitals are making great strides to control costs, improve quality, and reengineer the way we deliver care in this state. Additional Medicare and Medicaid payment reductions will hamper these efforts that will lead to greater quality improvements and lower costs.

Please follow the instructions below to contact your legislator and feel free to add any hospital specific information. We also encourage you to put the name of your hospital in the first line of the letter. We thank you for your actions and ask you to let us know if you receive any feedback from your legislators.

Click the link below to log in and send your message:
http://www.votervoice.net/groups/scha/default.aspx?issueid=27023&atid=20691