On Beacon Hill...
House and Senate negotiations on the FY 03 budget became more difficult after the Massachusetts Taxpayers Foundation (MTF) predicted that the FY03 budget will run a $650 million deficit. That deficit will occur, MTF says, despite the cuts proposed by the House and Senate and after the $1.2 billion in new revenues they have already agreed to. A group of Partners executives, led by President and CEO Sam Thier, MD, met with Speaker Finneran this week to reiterate the importance of uncompensated care pool relief and the restoration of funding for MassHealth Basic, as well as to make the case that arbitrary nurse staffing ratios are not the solution to the nursing shortage.
In Washington...
The House of Representatives gave its approval to a $350 billion Medicare prescription drug benefit. Included in the package are a number of provisions benefiting providers:
Hospitals
The House bill retains a 6.5 percent IME payment in FY 03 (5.9 percent in FY 04) and contains a more generous inflation update than current law (market basket minus 0.25 rather than minus 0.55).
Physicians
The House bill sets the inflation update at 2 percent for FY 03 rather than minus 5.7 percent under current law. It also makes changes in the calculation of the update that are designed to soften the impact of fluctuations in the GDP and correct for past data errors.
Home health
The House bill eliminates the 15 percent cut that would take effect October 1 and does not include the co-payment proposed by Ways and Means Chairman Bill Thomas (R-CA).
Medicare+Choice
The House bill allows Medicare+Choice plans to receive payments that equal 100 percent of fee for service, rather than the arbitrary 2 percent increase that has been in effect in New England for several years.
Most Democrats (and some Republicans) opposed the House measure, including the entire Massachusetts delegation. Democrats were not permitted to offer an alternative to the Republican measure but, had they been allowed to do so, their bill would have kept the IME at 6.5 percent through FY 07.
The Senate was expected to put a Medicare prescription drug bill on the Senate floor the week of July 15th, whether or not the Finance Committee has completed work on the measure. It’s not clear if this package will include provider relief. Some Senators are adamant that spending on beneficiaries must come ahead of any spending on providers.
Also in Washington, patient safety legislation that encourages doctors and hospitals to voluntarily provide data to a designated patient safety organization has now been introduced in both Houses. The Senate bill, authored by Senators Frist (R-TN), Jeffords (I-VT), Breaux (D-LA) and Gregg (R-NH), is S. 2590. The House measure, H.R. 4889, was introduced by Rep. Nancy Johnson (R-CT).