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Medicare panel wants higher rural payments

CNN, June 12, 2001

WASHINGTON (AP) -- Medicare should increase the help it gives rural hospitals and clinics to keep pace with more-populated areas, a panel of private experts plan to advise Congress.

The panel -- focusing on rural hospitals -- recommends increasing the lump-sum payments such hospitals get for serving a larger-than-average share of low-income patients, the Medicare Payment Advisory Commission says in a draft report obtained by The Associated Press.

Urban hospitals have generally received more for serving low-income patients, which has led rural advocates to call for the increases.

The panel's recommendation would essentially allow the rural hospitals to claim extra federal dollars. The report, however, raises doubts on whether Congress can attract HMOs and their improved benefits to rural areas, which have a limited and widely dispersed population.

The Medicare advisers stressed that rural residents don't appear to be getting any worse services than their city counterparts, but they acknowledged growing concerns about health care in rural America.

"The geographic isolation, low population density, and poor economic conditions in many rural areas impose economic hardships on providers and make it difficult to attract health professionals," the draft said.

Congress is expected to get the report this week.

The panel offers Congress advice on Medicare, which provides health care for about 40 million elderly and disabled Americans. The group makes nonbinding suggestions on how much doctors, hospitals and other health care providers should get for serving Medicare patients.

Its members include executives from hospitals, insurance companies and business firms.

Senator Max Baucus, a Montana Democrat who is chairman of the Senate Finance Committee, has sought extra help for rural hospitals, which serve roughly 10 million Medicare enrollees or one in four of all participants.

Baucus' spokesman Mike Siegal said Monday that the committee, which writes Medicare laws, would consider any recommendations to achieve that goal.