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Word on Washington


Mike McIntyre

              7TH DISTRICT             NORTH CAROLINA



November 15, 1999


Fighting For Quality Health Care

As we approach the dawn of a new millennium, we do so with great optimism and hope for the future. We are truly fortunate to live in a time of great progress and advances, especially in the fields of science and technology. Indeed, this century has witnessed dramatic changes in the delivery of health care in America. In 1900, the average life expectancy at birth was only 47 years. Fortunately for us, that figure has risen dramatically throughout the century, and by 1995, the average American was living to be almost 76 years old. We are living longer. Not only can we hope to live well into our seventies, but also we can expect to enjoy a better quality of life thanks to the vast improvements in health care.

However, the future of our nation’s health care delivery system has recently been put into question as concerns have risen regarding the impact of cutbacks in Medicare due to the Balanced Budget Act of 1997 (BBA). This comprehensive legislation, while intended to shore up the Medicare program, went too far with many of the cuts it mandated. As a result, the BBA has led to many unintended consequences for health care in rural America, while the Health Care Financing Administration’s interpretation of the BBA has only served to exacerbate these problems. Thus, an urgent health care crisis is now facing southeastern North Carolina and all of rural America.

Over the last several months, I have met with and heard from numerous health care providers and beneficiaries from the Seventh Congressional District in an effort to address this critical situation. Many providers are teetering on the brink of reducing and eliminating essential services, while a vast number of citizens faces the threat of being shut out from receiving vital health care. As Co-Chairman of the bipartisan Congressional Rural Health Care Coalition (RHCC), I have brought these concerns to the attention of my colleagues in Congress and urged them to help me in providing much-needed relief to our rural health care community. I, along with my colleagues in this caucus, made it clear that any Medicare reform proposals brought before Congress must include help for our rural areas if they are to gain our support.

Therefore, I am pleased to inform you that our calls for action did not go unheeded, as the House Ways and Means Committee and the Commerce Committee met to consider legislation to address the issue of BBA relief. The result is an approximately $11.5 billion relief package, the Medicare Balanced Budget Refinement Act of 1999, which is designed to mitigate the impact of Medicare cuts mandated by the BBA on health care providers. While this legislation by no means fully corrects all the problems facing rural health care, it certainly represents a step in the right direction toward allaying the current health crisis in America. This legislation overwhelmingly passed the House on November 5 by a vote of 388 to 25. In addition to receiving strong support in Congress, this package was endorsed by many of the major health care organizations, including the American Hospital Association, the North Carolina Hospital Association, the National Rural Health Association, and the National Association of Community Health Centers.

Among the many provisions included in the Medicare Balanced Budget Refinement Act of 1999 are the following measures which address some of the most critical programs in rural health care:


  • Medicare Hospital Outpatient Prospective Payment System (PPS) for Rural Hospitals -- This provision allows rural hospitals with fewer than 100 beds the flexibility to choose either a transitional PPS payment or the rate they would have received in 1996 before the BBA was enacted.
  • Phase-Out of Medicaid Reasonable-Cost Reimbursement to Community Health Centers and Rural Health Clinics – This provision creates an alternative Medicaid PPS for community health centers and rural health clinics.
  • Medicare Dependent Hospital (MDH) Program – This provision extends the MDH program by 5 years from fiscal year 2001 to fiscal year 2006.
  • Medicare Rural Hospital Flexibility Program – This provision changes the 96-hour limitation on individual inpatient hospital stays at Critical Access Hospitals (CAHs) to an average inpatient stay of patients not to exceed 96 hours. It also allows hospitals that closed or downsized within the last ten years to convert to CAH status.
  • Rural Graduate Medical Education Residency Program – This provision expands residency opportunities in rural settings by increasing the per resident limits for Graduate Medical Education programs by 30% for rural and non-rural hospitals with rural training programs.
  • Grant Program for Rural Hospital Transition to PPS – This provision permits rural hospitals with fewer than 50 beds to apply for grants of up to $50,000 to help meet the costs associated with implementing the new PPS.
  • Home Health Agencies – This provision delays the 15% reduction in home health payments under the PPS until 12 months after the implementation of PPS. It also establishes the lesser of $50,000 or 10% of an agency’s Medicare payments the previous year as the annual amount of an agency’s surety bond requirement.
  • Skilled Nursing Facilities – This provision provides a 10% increase in payments for 12 resource utilization groups (RUGs) for medically complex patients for a period of six months.
  • Therapy Caps – This provision provides three separate caps of $1,500 each per beneficiary/per facility for physical therapy, occupational therapy, and speech therapy.
  • Pap Smears – This provision increases the payment rate for pap smears to $14.60 and requires the Secretary of Health and Human Services to review the payment rate periodically.

These reforms, along with the others included in the House-passed Medicare refinement package, must now be considered by the Senate before they can be signed into law by the President. With Congress expecting to adjourn this week for the remainder of the year, it is critical that an agreement be reached between both houses and the Administration. I will continue to work with my colleagues to ensure that we do not miss this opportunity to provide critical relief to both health care providers and beneficiaries. In doing so, we can rest assured that our nation’s health care system will continue to lead the way in advances far into the next millennium.

The concern about good health care is something that affects everyone, regardless of age, sex, race, occupation, or geographic location. I am grateful for the positive strides we have recently made in Washington, but I am determined to do even more to meet the critical health care needs that our area and our nation face. The battle for quality health care is worth the fight to make it right!  

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