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Volume 12 Number 242 News: Medicaid Sens. Jeff Bingaman (D-N.M.) and Elizabeth Dole (R-N.C.) introduced Dec. 12 legislation (S. 2460) to extend for one year a moratorium on Medicaid reimbursement rules that would cut an estimated $4 billion from providers over five years. "The impact of [the Medicaid reimbursement rules] on patient services, emergency preparedness, physician training, and state Medicaid programs would be devastating," according to a Dear Colleague letter from Bingaman and Dole. The Centers for Medicare & Medicaid Services published the final rule on provider cost limits on May 29 (72 Fed. Reg. 29748). CMS also proposed to eliminate funding for hospitals' graduate medical education (GME) training programs in a rule published on May 23 (72 Fed. Reg. 28930). The Bingaman/Dole legislation would extend a moratorium for the provider costs limits and GME rule that expires May 25, 2008, contained in the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act of 2007. The measure was enacted May 25, 2007 (H.R. 2206; Pub. L. No. 110-28). The legislation also would extend the moratorium expiring May 25, 2008, to another proposed Medicaid rule limiting reimbursement for outpatient services that CMS published Sept. 28 (72 Fed. Reg. 55158). Further, the outpatient services rule also would be covered as part of the additional one-year moratorium until May 2009, according to the bill summary. The S. 2460 bill was introduced and referred to the Senate Committee on Finance on Dec. 12. The current moratorium on provider costs limits has prevented the 43 hospitals in North Carolina from losing their public hospital designations, Dole said in a press release. A total of 45 hospitals in the state serving low-income and the uninsured would have lost $330 million in Medicaid reimbursement this year, the release said. While CMS has said that these rules are meant to ensure the integrity of the Medicaid program, hospital groups say the rules would jeopardize the health services they provide to low-income and uninsured Americans and their abilities to train physicians (No. 233 HCDR, 12/5/07 a0b5m6b6h5 Rehab and School-based Rules
Meanwhile, in the House, Rep. John Boozman (R-Ark.) introduced Dec. 11 legislation (H.R. 4355) for a one-year moratorium on two CMS rules that would cut Medicaid reimbursements for rehabilitation services and for certain school-based administrative and transportation costs.
Although CMS said the proposed rehabilitation rule (72 Fed. Reg. 45201) and school-based services rule (72 Fed. Reg. 51397) would save an estimated $5.8 billion over five years, opposition has come from health care groups, senators, and governors who say the rules would limit services for children and adults with disabilities.
The legislation is the first stand-alone bill for a moratorium on both CMS rules. Similar language to extend a moratorium until January 2010 was included in H.R. 3963, a bill to reauthorize the State Children's Health Insurance Program vetoed by President Bush Dec. 12.
A group of 39 senators said Nov. 19 they were concerned about a veto threat of the SCHIP legislation and requested that the Senate Finance Committee include a two-year moratorium in a Medicare package or in another legislation.
"By introducing stand-alone legislation, we hope to highlight the strong need for the money, and the services, across the country," said Kathee Facchiano, legislative director for Boozman, in a letter to colleagues.
H.R. 4355 was referred to the House Committee on Energy and Commerce.
Federal Response
During a Nov. 1 hearing on CMS Medicaid rules held by the House Committee on Oversight and Government Reform, CMS State Operations Director Dennis Smith said the Medicaid program would continue to cover "medically necessary services." He emphasized that the proposed rules were intended to ensure the fiscal integrity of the Medicaid program. For some time CMS has been concerned about manipulation of the Medicaid system in ways that enable federal dollars to be directed into state programs that are unrelated to Medicaid program objectives.
CMS has said the rehabilitation rule is meant to ensure that the Medicaid program does not pay for services whose funding is available through other federal, state, or local government programs. Further, the agency has said that, while reimbursement would no longer be available for certain school-based administrative and transportation costs, Medicaid would continue to cover services in children's Individualized Education Programs and for transportation from schools to health care providers in the community for covered services.
Governors Oppose Rules
Although a total of six proposed rules are projected to save the Medicaid program $11 billion over five years, governors say the rules would shift costs to states.
A group of 30 governors sent a letter Dec. 12 to House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.) requesting that moratoriums be extended to all six proposed rules on: provider cost limit, GME, provider taxes, hospital and clinic outpatient definitions, school-based services, and rehabilitation services.
"Taken together the CMS Medicaid cuts will reduce federal funding to states, counties and safety net providers by billions of dollars annually," the governors said in the letter. "We cannot stress enough that Congressional action is urgently needed to prevent the rules from becoming final and to provide for a more appropriate and thoughtful review by Congress of these important policy changes."
The governors' letter is available. Bingaman's letter is available.
By Wangui Njuguna
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