INTRODUCTION OF THE HEALTH CARE PRESERVATION AND ACCESSIBILITY ACT OF 1999 -- HON. BOBBY L. RUSH (Extensions of Remarks - October 26, 1999)

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HON. BOBBY L. RUSH OF ILLINOIS IN THE HOUSE OF REPRESENTATIVES TUESDAY, OCTOBER 26, 1999

Mr. RUSH. Mr. Speaker, State hospitals all over the country are experiencing severe financial crisis due to the Balanced Budget Act of 1997 (BBA 97, P.L. 105-33), which reduced Medicare reimbursements to hospitals and health service providers over a 5-year period. The BBA cuts ordered in 1999 were supposed to slow the growth of Medicare and save $112 billion over 5 years, including $4 billion from Medicare payments to hospitals. However, the BBA, which I opposed, has imposed severe financial burdens on teaching hospitals, rural hospitals, skilled nursing facilities, and home health providers. In my State alone, hospitals are estimated to lose $2.8 billion in Medicare payments over a 5-year period.

The financial burden of the BBA cuts is causing severe pain for the teaching hospitals in my State. Because Illinois ranks fifth in the Nation in the number of teaching hospitals, and these facilities are expected to lose more than $1.6 billion over the 5-year period, of the BBA's life. These cuts have a devastating effect on the communities that they serve.

In order to provide relief for these hospitals, I am introducing the Health Care Preservation and Accessibility Act of 1999, which will restore one-third of the difference between the projected and actual savings from hospitals. The legislation will accomplish this by freezing the cuts on teaching hospitals, rural hospitals, children's hospitals that operate graduate medical education programs, skilled nursing facilities and home health care. Specifically, my legislation will restore cuts in the following manner:

Teaching Hospitals: Freezes the cuts in indirect medical payments (IME) to 1999 levels. It also freezes cuts in the disproportionate share payments (DSH payments) at 2% and provides payments directly to those serving a large share of low-income patients.

Children's Hospitals--GME: Directs the Secretary of Health and Human Services to make payments as specified to each children's hospital for the cost reporting period under Medicare for FY 2000 and 2001 for the direct and indirect expenses associated with operating approved medical residency training programs.

Rural Hospitals: Sets a floor on outpatient hospital payments so that rural hospitals do not fall below 1999 levels and establishes a new payment system for rural health centers.

Safety Net Providers: Revises the payment system for community health centers so that it more adequately covers the costs and allows those providers that furnish service to low-income Americans to be directly compensated for their services.

Rehabilitation Therapy Caps: Eliminates the $1,500 per beneficiary cap imposed by the BBA and replaces it with a payment system that is based on the severity of illness.

Skilled Nursing Facilities: Revises the BBA's new prospective payment system for skilled nursing facilities. My bill will increase reimbursements for patients needing a high level of service to more accurately reflect the cost of their care. It will establish a demonstration program where the rule requiring a 3-day hospital stay for skilled nursing services can be waived for certain illnesses.

Home Health Providers: Delays a 15% reduction in the interim payment system if the Secretary of Health and Human services misses the deadline for instituting the new prospective system. It also allows for interest free recoupment of overpayments due to HCFA's underestimation of the interim payment rates for certain agencies.

My legislation also provides additional protections for senior citizens and persons with disabilities and strengthens protections and sanctions for Medicare fraud and abuse.