[WASHINGTON, DC] – The U.S. Senate late last night passed the Medicare Access and CHIP Reauthorization Act, which includes a compromise negotiated by Congressman Steve Cohen (TN-09), Senator Lamar Alexander (R-TN) and Congressman Diane Black (TN-06) that will guarantee disproportionate share hospital (DSH) allotments totaling more than $530 million over the next 10 years to help the state’s hospitals and community health centers recoup expenses incurred caring for those who cannot afford to pay. Tennessee is the only state in the nation that does not receive these automatic DSH allotments, which ended with the creation of TennCare. Along with last month’s House passage, today’s vote in the Senate sends the legislation to the President Obama’s desk for his signature.
“Tennessee hospitals deserve the same level of certainty about their DSH payments that hospitals throughout America have, and this agreement will provide that certainty,” said Congressman Cohen. “Senator Alexander asked me to get involved and to find a compromise that would bring Democratic leaders and Republican leaders together. I am pleased to get both Democrats and Republicans to agree on this 10-year extension and to have led the delegation in securing half a billion dollars for Tennessee hospitals. These payments will help keep some hospitals in the state open and will save Shelby County taxpayers money as the DSH funds received by Regional One would otherwise be their responsibility.”
In recent years, the Tennessee Congressional Delegation had to seek waivers to secure annual DSH payments. As a result of Congressman Cohen’s work and his collaboration with the other members of the Tennessee Congressional Delegation, Tennessee’s hospitals will receive $53.1 million in DSH payments annually and are guaranteed the funding stream for the next decade. Regional One Health (formerly The MED) and Le Bonheur Children’s Hospital in Memphis will benefit significantly from the newfound certainty and the funding of this new DSH payment schedule and Shelby County residents can rest easy knowing that the future of emergency, life-saving services provided there will no longer be in jeopardy due to erratic funding shortfalls.
WASHINGTON, D.C., April 14 – U.S. Senator Lamar Alexander (R-Tenn.) today voted for the Medicare Access and CHIP Reauthorization Act, legislation that will permanently put an end to the formula, passed by Congress in 1997, that dramatically capped Medicare payments to physicians and has since been temporarily overridden by Congress 17 times. The bill also includes 10 years of funding for Tennessee’s Medicaid disproportionate share hospital (DSH) program, which helps Tennessee hospitals cover the costs of caring for low-income patients.
“This legislation will permanently end the threat of payment cuts to doctors serving Medicare patients in Tennessee and throughout the country,” said Alexander, chairman of the Senate health committee. “It also includes an important measure to fund Tennessee’s Medicaid DSH program for the next ten years and reimburse Tennessee hospitals, which provided more than $2.4 billion in unreimbursed services to Tennesseans last year alone. I look forward to continuing my work with members of the Tennessee delegation on a permanent solution for Tennessee hospitals that provide care for those who need help the most.”
The legislation passed by a vote of 92-8 and, having passed the House in March, heads to the president’s desk for his expected signature.
The legislation repeals Medicare’s formula, known as the Sustainable Growth Rate or “SGR,” which was passed by Congress in 1997 to cap physician payments if Medicare spending exceeded annual targets, and has threatened such dramatic cuts in physician payments that it has been overridden by Congress 17 times since 2003. The bill replaces the formula with a bicameral, bipartisan solution to pay physicians for high quality care.
Alexander worked alongside members of the Tennessee delegation to help ensure that the bill would also include funding for Tennessee’s DSH program, which helps Tennessee hospitals cover the costs of caring for low-income patients. Funding for the state’s DSH program for the next 10 years was included in the overall package.
Tennessee is the only state in the nation that does not have a permanent Medicaid DSH program allotment. When TennCare was created through a waiver in 1994, the state agreed to eliminate the Medicaid DSH payment, believing the majority of the uninsured and uninsurable would be covered through the new TennCare. Unfortunately, costs began to escalate quickly and continue to grow, and by 2005, the TennCare coverage experiment ended.
Tennessee hospitals provided more than $700 million in unreimbursed TennCare costs last year. In addition to the unreimbursed costs, Tennessee hospitals provided $970 million in charity care and lost an additional $730 million on services provided to Medicare enrollees. This resulted in over $2.4 billion in unreimbursed cost from charity care and government funded health care programs.
In 2013, Alexander and Corker introduced the Fiscal Sustainability Act to reduce the growth of mandatory spending on Medicare, Medicaid and Social Security. The bill passed by the Senate today includes two provisions similar to the Medicare reforms proposed by the senators in their fiscal plan.
Watch a video of Congressman Black’s floor remarks on H.R. 2 HERE.
Washington, DC– Today Congressman Diane Black (R-TN-06), a nurse for more than 40 years and member of the Ways and Means Health Subcommittee, voted for H.R. 2, theMedicare Access and CHIP Reauthorization Act of 2015. This bipartisan legislation would repeal the flawed sustainable growth rate (SGR) formula and return stability to Medicare physician payments while also providing needed cost offsets.
The measure additionally includes language requested by Congressman Black giving Tennessee providers who treat Medicaid beneficiaries partial access to disproportionate share hospital (DSH) payments for the next ten years. Because of the enactment of the failed TennCare experiment, Tennessee became the only state in the union to be statutorily ineligible for this funding. This legislation provides an annual DSH allotment for Fiscal Years 2015-2025. Black previously joined Tennessee Members of Congress in sending a letter to House leadership requesting that this provision be included in any SGR legislation that is brought to the House floor. Congressman Black released the following statement:
“The passage of today’s permanent ‘doc fix’ legislation is a victory for Medicare beneficiaries and for the providers who care for them,” said Congressman Diane Black. “As a nurse for more than 40 years, I know that some problems can only be corrected with surgery, not a quick band-aid. Such is true of the flawed SGR formula. This ill-conceived measure dictated draconian cuts to Medicare reimbursements – cuts that Congress spent $170 billion since 2003 to delay, while failing to make the structural reforms needed to give certainty to seniors and their doctors. Today’s bill fully repeals SGR and replaces it with a bipartisan agreement that will return stability to Medicare physician payments while offering long-term savings for taxpayers. There is more work left to be done, but with this measure we are taking an important step forward to ensure the integrity of the Medicare program for today’s seniors and tomorrow’s retirees.”
Congressman Black added, “I’m also pleased that this legislation included language that I requested alongside Tennessee Members of Congress restoring access to DSH payments for our state hospitals over the next ten years. Our state’s exclusion from this funding has created uncertainty for our hospitals and threatens access to high-quality care for Tennesseans who need it most. The lack of DSH eligibility also affects other states. In 2013, Tennessee hospitals provided care to more than 350,000 residents from just our eight border states. Tennesseans aren’t asking for special treatment or carve-outs, our providers simply want access to the same resource that providers in 49 other states have. This is a matter of basic fairness and I was proud to lead efforts to ensure that this inequity would be addressed in today’s SGR package.”
Prior to today’s vote, Congressman Black spoke on the House floor to urge support for the legislation. Watch a video of her remarks here.