SOUTH CAROLINA HOSPITAL ASSOCIATION FEDERAL PRIORITIES

Transcription

1 SOUTH CAROLINA HOSPITAL ASSOCIATION FEDERAL PRIORITIES

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3 Hospitals serve an important role in communities across the country and in South Carolina. They are instrumental in maintaining and strengthening their communities and often are among the top five employers in a community. Not only do SC hospitals advance economic wellbeing by providing a stable employment, they are leading the nation in improving quality of care. Most hospitals are among the largest employers in their counties and create additional jobs by purchasing goods and services from other businesses. In 2012, hospitals accounted for more than 73,700 South Carolina jobs that are not easily outsourced and are paid above-average wages. SC hospitals paid $3.6 billion in wages and salaries, and their total hospital expenditures exceeded $1.5 billion. Not only are hospitals an important economic engine in their communities, they also provide essential health care services including primary care, surgery, laboratory services, emergency care, mental health services and more. South Carolina hospitals are in the midst of huge change working diligently to cut costs and to transform the way care is delivered to improve patient quality, safety and satisfaction, better coordinate care, improve community health and reduce costs. Due to the hard work and leadership of our hospitals, South Carolina is ranked by the federal government as one of the top five states making the most improvements in the quality and safety of healthcare and is leading the nation in improving healthcare safety and responsiveness. But we are just getting started. We must work with partners across the spectrum of care and throughout our communities. We also need support from our state and federal partners and to do so we ask you to consider the following 2015 federal priorities.

4 CUTS TO MEDICARE AND MEDICAID Ensure hospitals have the resources they need to provide high-quality care and meet the needs of their communities. Safety net hospitals, which provide primary, specialty, and inpatient care to the uninsured and low-income patients, face even larger uncertainty due to the number of Medicaid and Medicare enrollees they care for. Their mission to serve vulnerable populations facing a variety of barriers to health care is becoming more difficult because of cuts to Medicare and Medicaid. Over the past several years, Congress has cut Medicare and Medicaid payments for hospitals services through bad debt reductions, Medicaid, DSH cuts, Sequestration and more. Currently, President Obama s fiscal year (FY) 2016 budget plan includes $431.3 billion in reductions to Medicare, of which $349.8 billion would come from providers. The Senate adopted the president s overall Medicare reductions while the House (FY) 2016 budget plan reduces Medicare spending by $148 billion and Medicaid and other health care spending by $913 billion. As hospitals work to control the cost of care, we ask Congress to avoid further reductions to hospital payments and to support funding that bolsters the health care workforce, improves access to care for vulnerable Americans, enhances hospitals disaster readiness and helps hospitals harness the power of information technology to provide safer, more effective and efficient care.

5 CLINICAL INTEGRATION Achieving clinical integration requires changes in provider culture, redesigning payment methods and incentives, and modernizing federal laws. Hospitals in South Carolina are reengineering the health care system by improving care coordination and making vast improvements in quality and safety. As providers seek to design a healthcare system for the future, current legal barriers impede many of these efforts. The nation needs laws and regulations that encourage our progress in improving care and care delivery for patients. Hospitals ask policymakers to provide user friendly antitrust guidelines and safe harbors that promote instead of hinder clinical integration, changes to the Stark patient referral laws, amendments to the civil monetary penalty law, changes to the anti-kickback laws, and clarifications to Internal Revenue Service rules.

6 HEALTH INSURANCE EXCHANGE Access to health insurance coverage is paramount to achieving and maintaining health. With the establishment of health insurance exchanges under the Affordable Care Act, many more South Carolinians now have access to affordable coverage. With the establishment of a Federal health insurance exchange in 2014 over 210,000 South Carolinians are now enrolled in 2015 Health Insurance Marketplace coverage. Approximately 88% of those enrolled received a tax credit of $278 per month on average and 92% of these individuals had the option to choose a Marketplace plan for $100 or less. These subsidies may be in jeopardy as the Supreme Court deliberates on whether it was the intent of Congress to only provide subsidies to states with a State Based Exchange (SBE). A decision for the plaintiffs would impact South Carolina and 36 other states where the federal government operates the Marketplace s technical functions and SC citizens would be ineligible for subsidies. Health insurance is important for hard-working families because it gives them access to preventive and other needed care in doctors offices and outpatient clinics. People without insurance are much less likely to seek this kind of care, even for serious or chronic health conditions. Too many ultimately seek far more expensive care in hospital emergency departments. Should they need to act, we encourage policymakers to do so quickly to preserve access to health insurance for the thousands of people in our state who cannot afford to buy health insurance without subsidies, and the thousands of people who now buy health insurance for their families on the individual market but who will not be able to afford to do so if prices rise by as much as 50 percent, as projected. SCHA is prepared to work with state and federal partners to find a solution to address the potential impact of an adverse Supreme Court decision.

7 EBOLA/HOSPITAL PREPAREDNESS Readiness is a responsibility for all hospitals as they prepare to serve as the cornerstone for communities facing emergencies from natural disasters to deadly diseases. Hospitals have always played a vital role in preparing disaster plans and providing assistance for extreme weather patterns and other emergency situations, but the increased threat of viruses like Ebola, the bar for preparedness has been raised. Due to the work of hospitals across our state, SC is undoubtedly more prepared than it was before the first U.S. Ebola infection in Dallas. The S.C. Department of Health & Environmental Control (DHEC), SCHA and other members of the state s health care and emergency response community have worked together to establish a basic response protocol for Ebola, and will continue to work to fill in the gaps as we get closer to establishing a statewide Ebola response plan. The ultimate goal is that this infrastructure developed to treat Ebola can be activated at any point to respond to other emerging infectious diseases or disasters. We support continued funding for hospital preparedness in recognition of this important role hospitals play in their community.

8 WAGE INDEX In order to account for wage differences between geographical areas, the Centers for Medicare & Medicaid Services (CMS) calculates Medicare payments to hospitals based on the hospital wage index. The calculation recognizes that average wages for doctors, nurses, and hospital staff differs between rural and urban hospitals. A provision in the Affordable Care Act created a national pool of money from which hospitals would be paid, rather than hospitals being paid by money given to each state. This change permitted the Commonwealth of Massachusetts to manipulate the hospital wage index and leave 41 states with a net decrease in their Medicare reimbursements. THE FAIREST THING FOR CONGRESS TO DO IS REPEAL THIS SPECIAL DEAL AND THEN WORK IN A BIPARTISAN MANNER TO ADOPT MORE MEANINGFUL REFORMS TO THE HOSPITAL WAGE INDEX FORMULA. SINCE ENACTMENT OF THE ACA THE TOTAL NEGATIVE IMPACT FOR SOUTH CAROLINA HOSPITALS IS $43.2 MILLION. THE RAC BURDEN The national Recovery Audit Contractor (RAC) program began in 2010 with the goal of ensuring accurate payments to Medicare providers. Hospitals take seriously their obligation to properly bill for the services they provide to Medicare beneficiaries, but the RAC program is in need of fundamental reform. Recovery Audit Contractors (RACs) are private contractors hired by the federal government to review hospital billing claims to ensure the accuracy of Medicare payments and are paid a contingency fee, receiving a percentage of the payments they identify and collect. Accordingly, RACs routinely maximize their profits by chronically denying claims that are accurate and overturned later through appeal. Hospitals are focused on caring for patients but are facing more RAC audits that subject them to additional administrative burden and costly payment denials. WE SUPPORT EFFORTS TO IMPROVE AUDITOR PERFORMANCE, INCREASE TRANSPARENCY AND PERMIT HOSPITALS TO REBILL PROPERLY DENIED CLAIMS WITHOUT UNREASONABLE RESTRICTIONS.

9 TWO-MIDNIGHT POLICY Complex patient stays of less than two midnights often require the same amount of resources as stays lasting more than two midnights. CMS should continue discussions with all affected parties to develop workable solutions including the possibility of a long-term payment alternative to address the reasonable and necessary inpatientlevel services currently provided by hospitals to Medicare beneficiaries that are not expected to span two midnights. A short-stay payment solution must be implemented before RACs can be allowed to audit any patient status determinations. WE SUPPORT LEGISLATION THAT WOULD REQUIRE CMS TO IMPLEMENT A NEW PAYMENT METHODOLOGY FOR SHORT STAYS IN FY IN ADDITION, WE APPLAUD THE PARTIAL ENFORCEMENT DELAY UNTIL OCT. 1, 2015 INCLUDED IN THE SGR PACKAGE. READMISSIONS Sens. Rob Portman (R-OH) and Joe Manchin (D-WV) and Reps. Jim Renacci (R-OH) and Eliot Engel (D-NY) have introduced legislation (S. 688/H.R. 1343) that would require CMS to adjust a hospital s performance in the Medicare Hospital Readmissions Reduction Program based on the sociodemographic status of its patients. WE SUPPORT LEGISLATION TO IMPROVE THE FAIRNESS OF CMS S READMISSIONS PROGRAM AND HELP ENSURE HOSPITALS HAVE THE CRITICAL RESOURCES NEEDED TO CARE FOR THEIR MOST VULNERABLE PATIENTS.

10 340 B PROGRAM The 340B program was established more than 20 years ago to provide financial relief from high prescription drug costs to safety-net hospitals. Section 340B of the Public Health Service Act requires pharmaceutical manufacturers participating in Medicaid to sell outpatient drugs at discounted prices to health care organizations that care for many uninsured and low-income patients. Hospitals use these savings to reduce the price of pharmaceuticals for patients and expand additional health services provided in the community. WE OPPOSE EFFORTS TO REDUCE OR SCALE BACK THE 340B PROGRAM THAT WOULD SIGNIFICANTLY IMPACT THE VULNERABLE PATIENTS IN OUR COMMUNITY WHO DEPEND ON THIS VITAL PROGRAM. ELECTRONIC HEALTH RECORDS Flexibility in Health IT Reporting (Flex-IT) Act (H.R. 270), would give hospitals and eligible professionals more flexibility in meeting meaningful use requirements for electronic health records (EHRs) in fiscal year Specifically, the legislation would shorten the 2015 reporting period to 90 days from the current 365 days for Medicare and Medicaid EHR Incentive Program participants using the 2014 Edition Certified EHR. Without this change, the vast majority of hospitals are required to meet all Stage 2 requirements starting on Oct 1, 2014, and maintain compliance through Sept. 30, HOSPITALS CONTINUE TO BE CHALLENGED WITH THE CURRENT REGULATORY TIMELINE FOR EHR DELIVERY, INSTALLATION AND IMPLEMENTATION. WE SUPPORT EFFORTS THAT WOULD GIVE HOSPITALS AND ELIGIBLE PROFESSIONALS MORE FLEXIBILITY IN MEETING MEANINGFUL USE REQUIREMENTS FOR ELECTRONIC HEALTH RECORDS.

11 SURVIVING ON SLIM MARGINS In 2012, the average Medicare margin for hospitals in South Carolina was -9%. Health economists consider a positive 4% margin the minimum necessary to ensure hospitals have sufficient funds to improve patient care and to reinvest in modernization.

12 HOSPITAL FINANICAL DATA REPORT DISTRICT 1 MARK SANFORD (R) 4,558 Hospitals Employees 1,069 $342,019,102 Salaries & Benefits 3 5,254 Hospitals Employees 596 $430,262,031 Salaries & Benefits DISTRICT 3 JEFF DUNCAN (R) Hospitals Employees 1,894 $844,750,628 Beds Salaries & Benefits 8 3,736 Hospitals Employees 924 $844,750,628 Beds Salaries & Benefits 15 20,757 Hospitals Employees 2,955 $1,419,526,667 Beds Salaries & Benefits DISTRICT 7 TOM RICE (R) 8 7,354 Hospitals Employees 1,039 $535,434,719 Beds 11,679 DISTRICT 6 JAMES CLYBURN (D) DISTRICT 2 JOE WILSON (R) Beds 8 DISTRICT 5 MICK MULVANEY (R) 6 Beds DISTRICT 4 TREY GOWDY (R) Salaries & Benefits 14 10,318 Hospitals Employees 2,280 $707,948,340 Beds Salaries & Benefits ANNUAL DATA FROM 2012

13 SOUTH CAROLINA HOSPITAL ASSOCATION ABOUT US Headquartered in Columbia, the South Carolina Hospital Association is a private, not-for-profit organization made up of nearly 100 hospitals and health systems and 900 individual members. An advocate on health care issues affecting South Carolinians, SCHA supports its members through advocacy, education, networking and regulatory assistance. MISSION SCHA s mission is to support its member hospitals in creating a world-class health care delivery system for the people of South Carolina by fostering high quality patient care and serving as effective advocates for the hospital community. VISION South Carolina s hospitals will be national leaders in improving the quality and safety of patient care, and SCHA will be a national leader in advocacy. CREDO We are stronger together than apart.

14 CONTACT INFORMATION FOR SCHA South Carolina Hospital Association 1000 Center Point Road, Columbia, SC J. Thornton Kirby, FACHE, President & CEO Rozalynn Goodwin, Vice President, Community Engagement Elizabeth Burt, Director, Federal and Member Advocacy Allan Stalvey, Executive Vice President, Advocacy & Communications Elizabeth Powers Harmon, Vice President, State Government Relations Schipp Ames, Manager, Advocacy Communications

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