Illinois Hospital Association

search:

Main Menu
Advocacy/ Legislation
Federal

March 22, 2007

Congressional Pressure Against CMS Proposed Rule Builds

March 19 marked the closing date to comment on the Centers for Medicare and Medicaid Services’ (CMS) proposed rule to cut Medicaid spending, including measures to limit payments to public hospitals to 100 percent of cost and narrow the definition of government provider, resulting in estimated national cuts of $120 million the first year and $3.97 billion over 5 years.

Despite a majority of the members of Congress voicing opposition to the proposed rule in the 109^th Congress, CMS proceeded and released it on January 18. Members of the 110^th Congress took up the fight and have weighed in against the rule. Earlier this year congressional letters of opposition were circulated by Sens. Durbin and Dole in the Senate and Representatives Eshoo and King in the House.

During the week of March 11, Representatives Waxman, Schakowsky, King, and Walsh circulated a House letter 53 to HHS Secretary Michael Leavitt urging him to withdraw the proposed rule. The letter was signed by 153 House members, including 10 members of the Illinois delegation (see below). In addition, Senators Rockefeller and Gordon circulated a similar Senate letter that garnered 60 Senate signatures, including those of Illinois Senators Durbin and Obama.

IHA thanks the following Illinois Congressional Representatives for signing the House letter asking HHS Secretary Michael Leavitt to withdraw the CMS proposed rule; and we thank Senators Durbin and Obama for signing a similar Senate letter circulated by Sens. Rockefeller and Smith.

Representatives Melissa Bean, Danny Davis, Rahm Emanuel, Phil Hare, Tim Johnson Ray LaHood, Daniel Lipinski, Don Manzullo, Bobby Rush and Jan Schakowsky (Rep. Schakowsky was one of the four House members who spearheaded organizing the letter).

Click here to see House Letter.

Background:

On January 18 the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule (CMS-2258-P) to carry out some of the five-year $12.2 billion in administrative savings proposed by the President in his FY 2007 budget.

The proposed rule would limit payments to public hospitals to 100 percent of cost and narrow the definition of government provider, resulting in estimated national cuts of $120 million the first year and $3.97 billion over 5 years.

For Illinois, limiting Medicaid reimbursements to cost would have a major impact on certain Illinois public hospitals and the Cook County intergovernmental transfer (IGT) program. The Cook County IGT is a vital part of the financial structure of the state’s Medicaid program, ensuring access to health care services for thousands of low-income, elderly, and disabled people throughout the state.

Illinois’ Governor has stated that this action would mean "a serious financial blow of $623 million" to certain public hospitals in Illinois and to the State. The total negative impact to Illinois’ Medicaid program could be even greater.

Similar proposals for limiting Medicaid were made in previous years. However, those measures would have required Congressional action – and Congress chose not to act. In addition, last year a majority of members of Congress expressed opposition to such a regulatory approach. Neither the House nor Senate included Medicaid cuts in their 2007 budget resolutions.

This proposal runs counter to states’ efforts to expand health care coverage for our uninsured and would further strain an already fragile health care safety net. In Illinois, it would undercut a critical component of our state’s Medicaid funding system.

The solution to Medicaid’s problems is not harsh spending cuts. The program warrants thoughtful dialogue and deliberation by Congress that ensures that the nation fulfills its obligation to care for the neediest people in our society and who depend on Medicaid as their health care safety net.

The greatest "cost" of not blocking this rule will be in the toll it takes on the 57 million Americans who rely on the Medicaid program for their health care.

Click here to see copy of IHA Comment Letter on CMS proposed rule 2258-P.