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Hospitals vow to reverse budget cuts

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The nation’s hospitals are being forced to swallow additional Medicare cuts as lawmakers rush to approve a budget deal before the holiday recess.

The deal reached between Rep. Paul Ryan (R-Wis.) and Sen. Patty Murray (D-Wash.) finds $28 billion in deficit savings by extending sequester cuts to Medicare until 2023. Those cuts had been scheduled to expire in 2021.

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With the deal on the fast track to passage, hospital groups are resigned to the agreement becoming law. But they are already plotting to reverse the changes in 2014.

“This sets a terrible precedent. Medicare cuts that will affect seniors are being used to fund other government spending,” said Chip Kahn, president and CEO of the Federation of American Hospitals (FAH).

Kahn said lawmakers kept their lips sealed about the possibility of approving more spending cuts for Medicare, and that the deal announced late Tuesday caught his group by surprise.

“We felt blindsided. There were some rumors out there but it wasn’t until [Tuesday] that this all gelled together,” Kahn said. “The people involved in this do not want this to get out because they didn’t want the people like us to get exercised.”  

On Tuesday, the FAH sent out an alert to its grassroots network, which includes more than 1,000 hospitals, asking them to tell their lawmakers to oppose the budget deal. But Kahn said the real lobbying action would be in 2014.

“My working assumption is this is going to pass; the powers that be have deemed it so,” Kahn said. “There are some trains you can stand in front of but you have to make sure you can jump out of the way because the train is not going to stop.”

Other hospital groups have also voiced displeasure about the Medicare cuts.

In a memo sent Wednesday to members, the Greater New York Hospital Association (GNYHA) said it was disappointed by the proposal.

“Unfortunately, in order to pay for these changes, the 2% sequester cut to Medicare providers (including hospitals) is extended to 2022 and 2023. GNYHA is extremely disappointed that the agreement will extend these cuts into the future,” wrote Ken Raske, the group’s president.

Hospitals have long lobbied against budget cuts. An October 2013 “advocacy action packet” drafted by the American Hospital Association and obtained by The Hill advises advocates to “reject arbitrary cuts to Medicare and Medicaid funding for hospital services” as its first bullet point.

While Medicare payments will be cut under the plan, other government programs stand to benefit from the cancellation of $63 billion in sequester cuts to defense and discretionary spending over the next two years.

  David Moore, senior director of government relations for the Association of American Medical Colleges (AAMC), called the proposal “a good first step” despite concerns about the Medicare cuts.

“We are not going to set our hair on fire on one single provision where there are other provisions that are very important to our members,” Moore said, noting the group will support the proposal.

The AAMC represents medical schools and teaching hospitals. The sequester cuts were choking funding for government programs like the National Institutes of Health.

“We have to worry about medical research. We have to worry about Medicare. We have to worry about medical education funding,” Moore said. “We can’t say that we are worried about one part of this proposal and blow the whole deal up. ”

Restoring government funding for those programs for at least the next two years has won support from others as well. NDD United, a coalition of more than 3,000 trade and public interest groups, sent a letter to lawmakers on Wednesday urging them to pass the Ryan-Murray plan.

“For the last three years, we have been moving backwards. This stops the backwards movement, turns the corner and helps to get us close to where we once were,” said Joel Packer, co-chairman of NDD United. “If this fails, we get nothing. The sequester is locked in for next year. This is the last, best hope.”

Passage of the Ryan-Murray deal will not end the lobbying against the sequester because the full spending cuts will return in 2016.

“We will definitely be making the case that starting in fiscal year 2016, Congress needs to get rid of the sequester,” said Packer, also executive director of the Committee for Education Funding.

Others will be lobbying to reverse the new fees approved in the budget plan.

The aviation industry has long lobbied against taxes on airline ticket purchases that help fund the Transportation Security Administration — fees that Ryan and Murray have proposed increasing to help reverse sequester cuts.

Airlines for America (A4A) has lobbied hard against the fee increase. The group handed out air sickness bags this month at Washington, D.C.’s Reagan Washington National Airport, urging passengers to contact Congress in opposition to the tax.

“We hope the Congress will consider additional reforms in the way our industry is taxed and the ways that fees are used,” said Jean Medina, an A4A spokeswoman. 

Federal worker unions are upset by how new government workers will be asked to contribute more to their retirement. In a statement Tuesday, J. David Cox, president of the American Federation of Government Employees, said his union “cannot support any budget deal that asks for more from federal employees.”

Lawmakers are expected to vote on the budget deal this week. Lobbyists say the fight is far from over.

“They are going to at least address sequestration six or seven times before we get to 2021. This going to be an ongoing discussion and we are going to engage with lawmakers,” said Moore with AAMC. 

Bob Cusack and Keith Laing contributed to this report.

 

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