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Convincing urban states key in Medicare reimbursement fix

By John Van Nostrand

Creston News Advertiser, May 29, 2003

General George Armstrong Custer and the Calvary were outnumbered which led to his famous last stand in the plains of Montana.

That same principle appears to be the biggest problem for Iowa and improving Medicare reimbursement for Iowa health care providers.

U.S. Senator Charles Grassley (R-Iowa) spoke Wednesday to an audience of about 50 people at Greater Community Hospital about the Medicare reimbursement issue, what could happen to it this summer and how it could help the Hawkeye state.

Medicare is the federal health-care insurance program for those 65 and older and the disabled. It pays for certain health-care services and charges. Iowa ranks last in the country for reimbursement which has caused a financial strain on Iowa hospitals, including Greater Community Hospital. In Iowa, reimbursement is less than the actual cost of the service.

"People just might think we are responding to a lot of senior citizens," Grassley said.

June marker

Grassley said June will be important in the progress of improving Iowa's Medicare reimbursement status. Grassley said when Congress meets next month, discussion will be about including prescription drugs into Medicare coverage. Grassley said he hopes any bill involving adding prescription drugs will also include revising the Medicare reimbursement.

Grassley is chairman of the Senate Finance Committee which oversees Medicare and several other financial-related programs.

But convincing other Congressmen about changing reimbursement, specifically ones in more populated states than Iowa, will be difficult. Iowa is considered a rural state based on population. Grassley used New York as an example of an urban state. New York City alone has more population than the state of Iowa. Grassley said Iowa has 1 percent of the nation's population.

"It is difficult for them to see a problem in rural America," Grassley said about urban Congressmen.

About 70 percent of Greater Community Hospital's patients utilize Medicare, which also reflects Iowa's aging population. Hospitals in urban areas with younger populations, like New York City, with fewer Medicare-elegible patients don't have the financial struggles with Medicare like in Iowa.

Greater Community Hospital Board of Trustee Chairman Dave Driskell echoed Grassley's concern about convincing urban state representatives to make changes.

"Part of the difficulty of the House and Senate is you have five from Iowa and 55 from California," he said about the number of representatives from respective states.

Grassley said states with more Medicare reimbursement than Iowa won't want to give up their funds.

Lost funds

Medicare reimbursement is one reason why Greater Community Hospital lost about $700,000 in operating income, as of Jan. 31, during fiscal year 2003. Hospital Chief Financial Officer Dave Brokaw speculated the loss for fiscal year 2004 will be $682,286.

Who's covered?

A man in the audience asked about the number of Americans who don't have health insurance and how that impacts health-care operations.

He said 27 percent of the 40 million people without health insurance have an income of at least $40,000. He said that should be enough to pay for insurance. Grassley said about 12 million people have low-paying jobs with insurance but can't afford the co-pay.

He also mentioned illegal aliens in America are allowed health-care services. Arizona representatives have voiced their concerns regarding that.

Brokaw said at Greater Community Hospital people who are unable to pay for health care-services have led to a cumulative bill during the past year of more than $100,000.

"No one is ever denied care," he said.