America's Hospitals: The Key to Healthy Communities

Congressman Hoyer Speaks to the American Hospital Association's Annual Meeting

For Immediate Release:

April 28, 2003

Contact:Steny H. Hoyer

What makes a community, whether large or small, really great?  Obvious answers come to mind.  Top-flight schools.  A vibrant local economy.  An educated workforce.  Clean parks and safe streets.  And, of course, a first-rate hospital and health care.

So why do we force the nation's hospitals -- the backbone of healthy communities – to bear the brunt of funding cutbacks?  Even as they deal with rising labor costs caused by a severe workforce shortage and the escalating costs of the latest medical technologies?

I wish I could offer you an easy answer to that question, but I cannot.  However, I do believe that, working together, the federal government and you, the representatives of america's hospitals, can address your most pressing needs.

We simply cannot keep asking you to do more with less.

I appreciate the pressure you’re under: complying with regulatory requirements, struggling to afford new and costly technologies, and serving a growing medicare population.

Your expenses have increased by more than 8 percent since 1998, while payment rates have increased only 1.6 percent.

And every year, you bear the burden of billions in uncompensated care.

Given the facts, it defies commonsense for the Medicare Payment Advisory Commission (MEDPAC) to be recommending cuts to hospital inpatient and outpatient services for fiscal year 2004.

It’s bad enough that more than half of America's hospitals lose money on every Medicare patient they treat.  And it’s no wonder that one-third of our hospitals operate in the red.  The truth is, we should be working to ensure that you have the financial resources necessary to meet patient and community needs.

I realize this is a bipartisan group, and I don't intend to inject partisanship here.  But we would be remiss if we failed to acknowledge the obvious:

It defies commonsense to propose $93 billion in Medicaid cuts over 10 years – as House Republicans did in their recently passed budget resolution – when state governments are grappling with budget deficits that could total $100 billion next year, leaving them little alternative but to consider deep cuts to Medicaid in order to bring their budgets into balance.

It's a national disgrace that more than 41 million Americans – including 9 million children – have no health insurance.

But it's simply inconceivable that the Republican Congress would consider proposals that could add millions more to the list of the uninsured, particularly when those proposals are designed to make room for unaffordable tax cuts that overwhelmingly benefit the wealthiest among us.

We may not agree on the size or the necessity of certain tax proposals.  But there can be little disagreement that tax cuts have to come from somewhere – especially when you’re running a $400 billion deficit.

For demonstrable proof that health care funding would pay for such tax cuts, one need look no further than the House GOP Budget Resolution.

This organization's Executive Vice President Rick Pollack hit the nail on the head after the vote on the House GOP Budget Resolution.

He said:  "This is not the time for the federal government to back away from its commitment to the people served by this program: the poor, the disabled, and the elderly.  To eliminate essential Medicaid funding takes away coverage from even more families and children."

House Democrats absolutely agree.

We should no more shortchange health care funding for our most vulnerable citizens than we should skimp on funding for schools or homeland security or defense.

In January, House Democrats introduced an economic stimulus plan that would provide $10 billion in immediate assistance to states for Medicaid.  That measure includes a 2 percent increase in the federal Medicaid match for states that maintain eligibility at current levels.

It would directly help states weather their worst fiscal crisis since World War II, prevent reductions in coverage and more adequately compensate our hospitals.

In contrast, the president's budget includes a proposal to give states the option to block grant about one-third of their Medicaid beneficiaries – the "non-mandatory" populations.

While it purports to give states flexibility, this proposal will inevitably lead to a reduction in services.

In exchange for accepting a fixed amount of funds -- rather than a dollar-for-dollar match -- the proposal would provide states with $13 billion in new funding for seven years, and then states would have to pay back those funds over the following three years.

Once funds are block granted, states could accommodate sudden increases in enrollment or costs by cutting beneficiaries or services, or raising taxes.

The administration's plan also would loosen federal oversight and accountability, dismantle the disproportionate share hospital program and eliminate the State Children's Health Insurance Program, which is credited with extending coverage to more than 5 million children.

Needless to say, House Democrats believe such an approach is a step backward.

We also are deeply concerned about the president's proposal to "reform" Medicare.

As best as we can tell – and the details are not clear – it seems designed to coerce beneficiaries out of traditional Medicare by offering more extensive coverage, including coverage for prescription drug costs, through private plans.

As the Washington Post reported one week ago, the president's "blueprint" offers little in the way of specifics on drug subsidies and feasibility.  But the Republican leadership in Congress plans to act on prescription drug legislation in the next few weeks, possibly before Memorial Day.

House Democrats strongly support adding a prescription drug benefit under medicare that is universal, guaranteed, affordable and voluntary.  Had medicine been as advanced when the medicare program was established as it is today, there is no question that prescription drug coverage would have been made part of that program.

Finally, on medicare, i believe it's imperative that the costs of prescription drug coverage not be financed by further cuts in provider payments.  As far as i'm concerned that's simply passing the buck – something that health care providers such as you have had to contend with far too often.

Permit me to mention just two other items before I close – regulatory reform and homeland security.

Two weeks ago, all hospitals were required to be in compliance with the medical privacy rules under HIPAA, the Health Insurance Portability and Accountability Act.

Given the magnitude of these rules, HHS must provide as much technical assistance as possible and we must ensure that they are having their intended effect: protecting patient privacy without interfering with patient care.

Further, I strongly believe that we have a duty to eliminate inefficient or outdated regulations that only create paperwork hassles and do nothing to increase your effectiveness and patient safety.  You are in the business of providing health care to patients, not amassing mountains of paperwork.

Finally, since well before September 11th, many of our hospitals – especially those who contend with hurricanes, blizzards and earthquakes – enacted disaster plans.

However, our hospitals simply could not have been prepared – and many still are not prepared – for the magnitude of the risk that confronts us in the war on terrorism.  Many of you have adopted contingency plans, and your efforts will undoubtedly save lives in the event of another disaster.

But you deserve more than praise and a pat on the back. You deserve the resources necessary to help you upgrade your readiness to respond to nuclear, biological and chemical emergencies.

Continually requiring you to do more with less – when it comes to emergency preparedness – is an irresponsible recipe for catastrophe.

Let me close by thanking you for all you do for the health care of the citizens of this nation, and your determination to overcome every hurdle that has been placed in your path.

Yours is a distinct and honorable mission deserving of our respect and support.

How many businesses could hope to survive without the guarantee of payment by their customers?  Yet, that is what you do every day of the week.

Walk into any hospital in our nation and you will see the American character at work: the hard work, the faith, the dedicatimon and the compassion.

For all the problems and issues that must be faced in the American health care system – the unacceptable number of uninsured and the burgeoning costs -- our nation's hospitals still offer the best health care in the world.  That is a tribute to you.

For too many, it's too easy to ignore the American hospital until that day inevitably comes when you or a loved one or a good friend need the indispensable services that only a hospital can provide.

I want to assure you that you have an ally here.  The continued vibrancy and strength of America's hospitals is not optional.  It's a moral imperative that this great nation must recognize and take seriously.

Thank you very much.

###