May 14, 1999

Moynihan Introduces GME and DSH Bills; Rangel Introduces IME Bill

Senator Daniel Patrick Moynihan (D-N.Y.) along with Sen. Edward Kennedy (D-Mass.) introduced legislation May 12 providing additional graduate medical education (GME) and disproportionate share hospitals (DSH) financial support to teaching hospitals.

Sen. Moynihan said, "Payment reductions contained the Balanced Budget Act of 1997 and a changing health care market place have put these hospitals in dire financial straits. The Graduate Medical Education Payment Restoration Act of 1999, the Managed Care Fair Payment Act of 1999, and the Nursing and Allied Health Payment Improvement Act of 1999 will provide critically needed funding for these teaching hospitals."

"The Graduate Medical Education Payment Restoration Act of 1999" (S. 1023) freezes the Balanced Budget Act's (BBA) reductions in Medicare indirect medical education (IME) payments. Under the BBA, the (IME) adjustment is scheduled to be reduced from 7.7 percent to 5.5 percent by FY 2001. Moynihan's legislation would maintain the IME adjustment at its current level, 6.5 percent.

Senators Kennedy (D-Mass.), Schumer (D-N.Y.), Helms (R-N.C.), Kerry (D-Mass.), Torricelli (D-N.J.), Durbin (D-Ill.), Santorum (R-Pa.), Lieberman (D-Conn.), Kerrey (D-Neb.), Levin (D-Mich.), Murray (D-Wash.), Specter (R-Pa.), Cleland (D-Ga.), and Edwards (D-N.C.) are listed as original cosponsors for S. 1023.

In addition, Sen. Moynihan introduced bills that would carve DSH payments and GME payments for allied health professionals from the Medicare Plus Choice payments and pay them directly to eligible hospitals. "The Managed Care Fair Payment Act of 1999" (S. 1024) is estimated to redirect more than $2.5 billion in DSH payments to eligible hospitals over 5 years. "The Nursing and Allied Health Payment Improvement Act of 1999" (S. 1025) would provide funding for these education programs to more than 700 hospitals.

In a prepared statement accompanying the introduction of the bills, Sen. Moynihan said, "Combined, these three bills will strengthen our nation's teaching hospitals and ensure that the United States will continue to be in the forefront of developing new cures, new medical technology, and training of the world's finest medical professionals."

Also, in May 12 Rep. Charles Rangel (D-N.Y.) also introduced legislation (H.R. 1785) similar to S. 1023. Earlier this year Rep. Rangel introduced H.R. 1103, which removes the DSH payments from the Medicare Plus Choice rates and pays them directly to eligible hospitals.

The AAMC urges its members to contact their Members of Congress to request that they cosponsor the Moynihan and Rangel bills.

Information: Richard Knapp or Lynne L Davis, AAMC Office of Governmental Relations, 202-828-0410 or 202-828-0526.