Senators work to aid rural hospitals

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Senators work to aid rural hospitals

Libby Quaid

Kansas City Star, April 29, 2003

WASHINGTON -Sen. Sam Brownback did not foresee the blow dealt to rural hospitals when he voted to balance the budget in 1997, but he is trying to reverse some of the damage now.

Brownback, R-Kan., and Sen. Ben Nelson, D-Neb., introduced legislation Tuesday intended to boost payments to hospitals from Medicare, the federal health insurance program for the elderly and disabled. Congress paid for the 1997 Balanced Budget Act by slashing billions of dollars from Medicare.

"We're beginning to now really feel the impact, the multiplier effect, of those billions and billions of dollars taken out of the system," said Maynard Oliverius, CEO of Stormont-Vail HealthCare in Topeka, Kan.

The cuts hit rural health providers particularly hard, forcing them to bear more of the cost of treating Medicare patients even as their Medicare population has grown.

At a news conference Tuesday at the U.S. Capitol, Brownback recalled that lawmakers in 1997 insisted that rather than cutting the program, they were merely slowing the rate of its growth. At the same time, he said, the government tightened its regulation of the program.

"These were two separate acts, but they combined to really hit hard," Brownback said. "We did slow the rate of growth, but it went beyond the policy that I thought we were setting forth."

Hospitals across the country have shuttered home health care and other services to survive the cuts. Susan M. Page, president and CEO of Pratt (Kan.) Regional Medical Center, said her hospital is considering whether to eliminate its skilled nursing and home health services.

Facilities have been operating in the red for more than two years, she said. "We can do that for only so long," said Page, who also heads the Kansas Hospital Association.

Nationwide, more than half of hospitals lose money because the government pays less than it costs to treat Medicare patients, in many cases basing reimbursements to hospitals on a formula rather than on actual costs.

Under current law, payments to critical access hospitals, those with 15 or fewer beds, are based on costs.

The Senate legislation would enhance those payments and extend them to providers under a new rural community hospital designation of 50 or fewer beds. The bill mirrors legislation introduced February in the House by Reps. Jerry Moran, R-Kan., and Jim Turner, D-Texas.

Ron Briggs, chairman of the Nebraska Hospital Association board, described how the hospital in Lexington, Neb., would benefit.

Half of Lexington's patients are covered by Medicare, and another 30 percent are covered by Medicaid, the government health insurance program for the poor. But the community of 10,000 people is not small enough to get the cost-based reimbursements.

"They're just a perfect example in our state of someone who needs this bill to survive," said Briggs, who also is CEO of St. Francis Memorial Hospital in West Point, Neb.

Nelson said without hospitals and other key services, such as air travel, "economic development in rural communities will virtually disappear."

The administrator of the Medicare and Medicaid system, Tom Scully, is scheduled to visit Kansas hospitals on May 27 with Moran and North Dakota Democratic Rep. Earl Pomeroy. The House members head a rural health care coalition.