Copyright 1999 The National Journal, Inc.
The National Journal
View Related Topics
SEPTEMBER 4, 1999
SECTION: LOBBYING; Pg. 2506; Vol. 31, No. 36
LENGTH: 1268 words
Getting a Second Opinion on Medicare
coalition of hospital trade associations anticipates
$ 7 million during the next several months
in an effort to persuade Congress
to restore billions of dollars
in Medicare cuts. The hospital groups, as
well as nursing homes
and rehabilitation centers, are gearing up for Capitol
combat over two-year-old reductions in Medicare reimbursements
they contend have forced many health care providers to
close key facilities, and discontinue some
health care programs.
At the center of the debate are provisions in the
Balanced Budget Act that lowered federal spending on health care
cutting Medicare reimbursements to hospitals and other medical
Hospitals rely heavily on the reimbursements to cover
the costs of providing
services to Medicare beneficiaries. Nearly
40 percent of hospitals' revenue
comes from Medicare.
Hospital officials maintain that the two-year-old law
unintended, budget-wrecking consequences. From 1998-2002, the
Balanced Budget Act cuts were supposed to reduce federal Medicare
spending by $ 116 billion, but the reductions are now expected to
nearly $ 190 billion. Hospitals were projected to receive $51 billion less in
reimbursements; however, an American Hospital
Association study estimates
that the five-year hit to hospitals
nationwide will be $ 71 billion. The
study also predicts that
Medicare costs will put seven out of 10 hospitals
in the red.
For the first time in Medicare's 34-year
spending on Medicare will fall from one year to the next. A
Congressional Budget Office study released in July estimates that
Medicare spending will decline from $ 211 billion in 1998 to $ 210
billion in 1999.
''This is the worst year for
hospitals in 20 years,''
said Thomas A. Scully, the Federation of American
president. ''CEOs are having a brutal time. They're laying
people, and they're in a financial squeeze.''
To press Congress for changes in the reimbursement rules,
groups have formed the Coalition to Protect Access
to Medicare and Medicaid.
Members of the coalition include the
AHA, Scully's federation, the Catholic
Health Association of the
United States, and the Association of American
whose members are worried about the impact that Medicare
have had on teaching hospitals.
members meet every Friday to coordinate
lobbying and grass-roots strategies.
The trade associations have
distributed wallet-sized cards to hospital
employees in Iowa and
New Hampshire to help them when questioning
candidates. Moreover, the hospital trade groups are encouraging
hospital employees to send members of Congress postcards that
to change the provisions of the budget act this year.
The coalition's goal
is to blanket Capitol Hill with one million
letters and postcards by early
September. Meanwhile, the
coalition has started flying hospital executives
and employees to
Washington for meetings on Capitol Hill.
The coalition is also bankrolling a radio and print
campaign, mostly with money from the AHA and the
federation. And the AHA is
calling on outside lobbying and media
consultants as reinforcements.
''Everyone we (regularly) used is
being turned loose on this,'' said AHA
Schadelbauer. Policy Impact Communications Inc., the
relations arm of the Barbour Griffith & Rogers lobbying
helped design and produce many of the ads that have already run.
Policy Impact's Ed Gillespie, a former top aide to House Majority
Dick Armey, R-Texas, is directing the PR effort.
Radio and print ads have run inside the Beltway and in
congressional districts. The ads warn that the
Balanced Budget Act is
causing ''real pain for real people.'' For
example, a spot that aired in
Seattle discusses the impact that
the reductions in Medicare reimbursements
had on the Virginia
Mason Medical Center, a major city hospital. The medical
Bailey-Boushay House, the ad stated, ''serves patients with AIDS.
But the Balanced Budget Act's reductions for skilled nursing
like Bailey-Boushay could force it to close.'' The
budget law contributed to
the health system's decision to close
satellite clinics in Seattle and two
rural communities, the ad
The coalition is
considering a ''significant escalation''
of its advertising efforts, Scully
said. The AHA and the
federation have spent approximately $ 3 million on
grass roots, and lobbying activities.
Scully and other hospital industry lobbyists want
overturn--or at least to delay--the budget act's
changes in the Medicare
reimbursements. But hospital lobbyists
must also play some defense.
President Clinton has proposed that
some changes in Medicare reimbursements
be made permanent. ''The
No. 1 priority for us is trying to prevent further
said AHA Executive Vice President Richard J. Pollack.
The White House proposal would also help hospitals
boosting Medicare reimbursements by $ 7.5 billion between 2000 and
2004. But Clinton's initiative would finance a new prescription
benefit for the elderly by extending some Medicare cuts to
provision, Scully said, will cost hospitals
approximately $ 36 billion from
2002-2007. ''They want to give us
back a crumb now, but kill us in the
future,'' he complained.
Meanwhile, key members of
Congress are preparing
legislation that would help hospitals. Rep. Bill
Calif., chairman of the Ways and Means Health Subcommittee, and
Senate Finance Committee Chairman William V. Roth Jr., R-Del.,
to introduce a bill sometime in September. Their
proposals are expected to
aid hospitals by increasing Medicare
reimbursement by as much as $ 10
billion, according to
congressional aides. Some hospital lobbyists say that
Lawmakers and lobbyists
want to attach the Thomas and
Roth proposals to other legislation, such as
the budget bill.
Because many members of Congress are eager to help health
facilities in their states or districts, the Medicare
changes could be added to legislation that needs a
sweetener to get passed.
The Medicare fix also could be attached
to the continuing resolution, which
gives Congress more time to
pass the remaining 12 appropriations bills.
Another option involves the Republican health care
legislation. House Speaker J. Dennis Hastert, R-Ill., could add
Medicare reimbursement changes to the patients' bill of
rights legislation that is being drafted by Reps. Tom Coburn, R-
Okla., and John Shadegg, R-Ariz. The bill is expected to reach
floor shortly after lawmakers return from their August
recess. Hastert will
need every vote he can get to pass the GOP
plan, and some strategists
maintain that attaching the hospital
relief provisions would boost support
for the Coburn-Shadegg
hospital groups are preparing for an
offensive. The AHA and the
federation face a conundrum. The groups want to
spend more money
on the hospitals' ad campaign, but the cuts in Medicare
reimbursements mean their members have less money to throw into
LOAD-DATE: September 09, 1999