2008 Medicare Package
Congress passes key rural Medicare legislation
On July 15th, the Congress overrode President Bush's veto of H.R. 6331 to make the Medicare Improvements for Providers and Patients Act of 2008 effectively law. The page below explains what would have happened had Congress not acted and provides additional information about the legislation and its provisions. Further information about implementation will be provided as we work with the Administration and the Congress. This is a huge victory for rural America!
What we were facing...
The ability to provide quality health care to rural Americans is once again in jeopardy unless Congress acts quickly to extend critical Medicare provisions that are set to expire on June 30. For more information about NRHA's efforts download the Medicare Package 1-Pager. Below are a summary of some of the provisions and requests that NRHA is making to Congress, beyond our strong support for halting the scheduled 10.6 percent payment cut to physicians, to improve the Medicare system for rural America.
Links:
- Updates
- MMA Rural Extenders
- Tweener Hospital Provisions
- Rural Health Clinic Cap
- Critical Access Hospital Flexibility
Updates
Congress overrides President's veto; vital rural Medicare package becomes law - July 15, 2008
On the same day that President Bush vetoed H.R. 6331, the Congress overwhelmingly overrode that veto. The House of Representatives voted 383-41 and the Senate voted 70-26. Both the House and Senate had more votes to override the veto than were originally cast to send the bill to the President. The NRHA had strongly supported passage of the bill which provides nearly $2 billion critical dollars to rural America and eliminates the pending 10.6 percent cut in Medicare payments to physicians through December 2009.
President vetoes Medicare package - July 15, 2008
President Bush vetoed H.R. 6331, the Medicare Improvements for Patients and Providers Act of 2008. The legislation had previously passed both the Senate and the House with overwhelming support. H.R. 6331 would provide $2 billion in needed rural health care dollars and temporarily eliminate the 10.6 percent cut to Medicare reimbursement rates for physicians. Overriding the veto will require a two-thirds majority in both the House and Senate. The NRHA needs your immediate help to ensure that this bill will become law.
$2 billion rural Medicare package passes Senate - July 9, 2008
On July 9, the Senate overwhelmingly voted to clear a procedural hurdle on critical legislation to protect access to health care in rural America by a vote of 69 to 30 and then passed the bill by unanimous consent. In an unexpected turn of events, Sen. Edward Kennedy (D-MA) joined in this historic vote and, as a long-time champion of vulnerable populations; his influence was a catalyst for the vote. This was Sen. Kennedy's first appearance in the Senate since having brain surgery. The legislation earlier passed the House, 355 to 59, and will now go to the White House to await the President's signature. Both votes were sufficient to override a threatened presidential veto. However we need NRHA members to continue to remind their legislators of the importance of the bill and to urge them to support the bill in the event of a veto. View our press release here.
Medicare cuts will be delayed until at least July 15 - June 27, 2008
Department of Health and Human Services Secretary Mike Leavitt said that the agency will maintain current Medicare payment levels, delaying the fee cuts until "July 15, at the earliest," allowing Congress the opportunity to pass a Medicare package after returning from recess. Senate Majority Leader Harry Reid (D-NV) has stated that the Senate will vote again on H.R. 6331 immediately upon their return. If the legislative dispute lasts beyond the new deadline, Leavitt said he hopes to retroactively pay doctors once the dispute is resolved.
Senate fails to take up Medicare package - June 26, 2008
The Senate failed to act on H.R. 6331, the Medicare Improvements for Patients and Providers Act of 2008, which would have halted the scheduled 10.6 percent payment cut and extended a number of vital rural provisions that approximately totaled $2 billion over 18 months. The vote to close debate failed by a single vote. The NRHA endorsed this bill and was deeply disappointed by the Senate's inability to pass Medicare legislation before the July 1 deadline. The Medicare cuts will go into effect on July 1, while Congress is on recess for Independence Day, but the NRHA will continue to work to see that these massive cuts are not permanent when Congress returns.
House passes Medicare package - June 24, 2008
The House of Representatives passed H.R. 6331, the Medicare Improvements for Patients and Providers Act of 2008, by a vote of 355 to 59. The NRHA endorsed this bill as it provides a number of improvements for rural seniors and providers as documented in the previous update. The Senate is still working on compromise legislation, we encourage you to contact your Senators and ask them to support a strong rural Medicare package.
For more information about H.R. 6331, please see the following documents:
House introduces Medicare package - June 20, 2008
NRHA staff met today with House Speaker Nancy Pelosi's office and Democratic committee staff of the Committee on Ways and Means and Committee on Energy and Commerce to discuss a Medicare package. The package that the House Democratic leadership is proposing, H.R. 6631 "Medicare Improvements for Patients and Providers Act of 2008," is expected to be brought to the House floor on Tuesday under a suspension of the rules, which requires a two-thirds vote in the House. The bill contains a number of provisions that are important to rural advocates including (basic summary available):
- MMA rural extenders to continue current a number of current payment policies
- Improvements for tweener hospitals
- Medicare rural hospital flexibility (FLEX) program reauthorization
- Telehealth service site expansion
- Prompt pay for physicians
For more information, visit our June 20th new article.
Senate works to avert Medicare cuts - June 12, 2008
The Senate attempted to close debate today on a bill that was introduced on June 6th by Senate Finance Committee Chairman Max Baucus (D-MT), S. 3101, the “Medicare Improvements for Patients and Providers Act of 2008.” The attempt failed by a vote of 54 to 39 (it needed 60). It is expected that Chairman Baucus will now need to negotiate with the leading Republican on that Committee, Ranking Member Charles Grassley (R-IA), who introduced a similar bill, “Preserving Access to Medicare Act of 2008” on June 11. Both bills contain provisions to prevent rural providers from receiving the cuts in Medicare reimbursements scheduled for July 1. Several other provisions critical to rural America are also contained, but Congress must do more.
For more information about the bills:
- S. 3101 (Baucus Bill) Staff Summary
- S. 3101 (Baucus Bill) NRHA Summary
- S. 3101 (Baucus Bill) Full Text
- Grassley Bill Staff Summary
- Grassley Bill NRHA Summary
- Grassley Bill Full Text
MMA Rural Extenders
The Medicare Modernization Act (MMA) of 2003 included a number of important provisions for rural providers that have helped correct a historic imbalance in Medicare payments to urban providers. By implementing these provisions in the MMA, Congress was helping to protect the fragile rural health safety net by paying providers in rural areas a more equitable rate. These provisions include:
- Work GPCI 1.0 Floor for Rural Physician Payments
- Outpatient Hold Harmless
- Payment of Reasonable Lab Costs for Certain Small Rural Hospitals as Part of Outpatient Services
- Treatment of Certain Technical Component Physician Pathology Services Under Medicare
- Incentive Payment for Physicians in Physician Scarcity Areas
- Two Percent Bonus Payment for Ambulance Trips in Rural Areas
- Five Percent Add-On Payment for Home Health Services
Each of the above, which have been extended in past Medicare bills, is once again set to expire on June 30th. The NRHA is strongly encourages Congress to include extensions of these vital provisions in any health package that is considered this year.
Tweener Hopsital Package
Rural hospitals paid under the prospective payment systems have struggled. In 1997, Congress created the Critical Access Hospital (CAH) program for hospitals under 25 beds. But for other small rural hospitals, there has not been a lot of help at the federal level. NRHA has worked with Congress to provide assistance for these hospitals that are collectively known as Tweener hospitals. Earlier this year, Senator Chuck Grassley introduced S. 2786, "Medicare Rural Health Access Improvement Act of 2008," which the NRHA strongly supports. We hope that Congress will include a few of the following provisions from that bill and others in the final Medicare package:
- Rebasing for Sole Community Hospitals (SCHs) - SCHs receive an add-on payment based on their historic cost to make up for low PPS payments. Unfortunately the last base year for this historic payment is over ten years old. The NRHA supports an updated base year to allow SCHs to receive a fairer payment.
- Elimination of the Disportionate Share Hospital (DSH) Cap - For hospitals that have a high Medicare and Medicaid population, Medicare pays an add-on payment known as a DSH payment. These payments are capped for rural hospitals but not most urban hospitals. This is inheriently unfair. Congress must eliminate this cap or at a minimum raise it above its current 12 percent.
- Improvements to the Medicare Dependent Hospital (MDH) Program - This hospital designation is slated to go away after 2011. As part of this, the law is supposed to reduce their payments beginning this year. Congress should keep this reduced payment from taking place and make other improvements to work towards making this designation permanently.
- Improve Low Volume Hospital Payments - Hospitals with low volumes of less than 800 discharges annually receive a bonus payment. Unfortunately this program misses most of the hospitals in need, especially after the creation of the CAH program. Congress should allow hospitals with more dischages to benefit from the Low Volume payments.
Rural Health Clinic Cap
Stand-alone or free-standing Rural Health Clinic (RHC) Medicare payments are a capped cost-based payment. That cap is currently at about $75, which is a capped rate well below other providers that receive a cost based payment. This is also well below what is needed to pay the full costs of serving a Medicare beneficiary. Congress needs to rectify this by raising the RHC payment cap to at least $92 an encounter.
Critical Access Hospital Flexibility
The CAH program has been existence for ten years. It has been successful in allowing small, rural hospitals with less than 25 beds keep their doors open. Prior to the program, hundreds of hospitals had closed their doors and hundreds more were threatened to do so. After ten years, it is clear that the program has worked. This section refers to two ways Congress can help CAHs with "flexibility":
- Extension of the Medicare Rural Hospital Flex Grants - The Flex program has been essential in the conversion and improvement of CAHs. The Flex program is increasingly being used for more than just CAHs, as State Offices of Rural Health are building further efforts to help all rural hospitals and providers. Congress must extend the program and grants.
- CAH Flexibility on Bed Count - Currently CAHs are capped at 25 beds. For most rural CAHs this limit is appropriate. However, some communities, especially those with large seasonal tourist or worker populations could use a larger census during a small portion of the year. Instead of an inflexible cap, hospitals should have an annual average of approximately 20 beds a day, allowing a hospital to respond to the needs of its community throughout the year.
Additionally, the Medicare package could include other provisions to guard the rural health care safety net, including ensuring rural representation on the Medicare Payment Advisory Commission, providing some help to rural pharmacists, raising the Federally Qualified Health Center payment cap, and adding rural providers to the 340 B Discount Drug Program. The NRHA strongly urges Congress to protect rural providers by passing these other equitable reimbursement adjustments.
