WASHINGTON, DC – Congressman Collin C. Peterson (D-Minn) Friday voted to restore more than $11 billion in funding to hospitals, nursing homes and home health agencies. The House of Representatives overwhelmingly passed H.R. 3075, a bill providing much needed relief to Medicare providers struggling from the effects of the 1997 Balanced Budget Act (BBA).

“Hospitals in my congressional district were hit hard after the 1997 BBA took effect,” Peterson said. “Rural hospitals often serve a disproportionate amount of Medicare patients. Unlike urban hospitals, rural hospitals can’t make up their costs on non-Medicare patients.  Our hospitals need help fast, or some are going to close down.”
 
H.R. 3075 provides greater flexibility for rural hospitals to work within the Medicare system.  Specifically, the bill would allow rural hospitals with less than 100 beds to choose between a three-year phase-in for an outpatient prospective payment system (PPS) and the option of receiving their 1996 (pre-BBA) payment rate.

Additionally, H.R. 3075 creates an alternative Medicaid PPS system for community health centers and rural health clinics — important safety-net providers serving rural and frontier Americans. The bill also strengthens the Medicare Rural Hospital Flexibility/Critical Access Hospital Program and expands Graduate Medical Education opportunities in rural settings.
 
“We still have a long road ahead of us to ensure Medicare stays solvent and provides current and future generations with benefits matching today’s technology,” Peterson said.  “But today, Congress took the first step in correcting payment cuts threatening the financial solvency of health care providers and the health of America’s seniors.”

If enacted into law, most provisions applying to rural health care providers will take effect on January 1, 2000.