Hospital trade group issues alert on looming cuts

The American Hospital Association issued an action alert to its members Tuesday asking them to urge their lawmakers to avoid looming cuts as the House reconvenes this week.

Congress punted last month on a long-term extension of the payroll tax cut and the Medicare "doc fix," requiring action by the end of next month. Postponing scheduled Medicare payment cuts beyond that date would cost about $30 billion per year of delay, and hospitals are worried that Congress could try to get the money from them.

"During December's negotiations," the alert warns, "issues of serious concern to hospitals" came into play.

• reductions in payments to hospitals for assistance to low-income Medicare beneficiaries that results in bad debt;

• reductions in payments for evaluation and management services provided in hospital outpatient departments;

• extending the current cap on therapy services to services provided in hospital outpatient departments in addition to the current cap on services provided in nursing homes and other freestanding settings;

• weakening the prohibition on the establishment of new physician-owned specialty hospitals, and relaxing the restrictions for growth on those that exist; and

• providing the Medicare agency with new authority to make additional across-the-board cuts to Medicare inpatient hospital rates through retroactive cuts for fiscal years 2010, 2011 and 2012.

"These critical issues, and others, will still be on the table when Congress returns," the alert says. "And given that this is an election year for this deeply divided Congress, the final bill may represent the only legislation to address Medicare issues before the election."