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Teaching Hospital Update - May 13-17, 2013


Email Alert

May 17, 2013

By Allison Cohen*
Edited by Amy Kaufman

Tavenner Receives Senate Confirmation to Head CMS

LA Times (5/15) reports the U.S. Senate confirmed Acting Director Marilyn Tavenner to head the Centers for Medicare & Medicaid Services. President Barack Obama nominated Tavenner, a former hospital executive and Virginia health secretary, in 2011.

Hospitals that Treat the Poor and Uninsured are Asking to Delay DSH Cuts

Bloomberg News (5/14) reports that as the Centers for Medicare & Medicaid Services (CMS) is issuing regulations to implement cuts to Medicaid disproportionate share hospital (DSH) payments, hospitals serving the poor and uninsured are asking to postpone or eliminate the cuts. CMS proposes a methodology to cut Medicaid DSH payments by $500 million in fiscal year (FY) 2014 and $600 million in FY 2015, as required by the Affordable Care Act. The federal government had intended for these reductions to be countered by an increase in the number of insured patients as a result of the expansion of states' Medicaid programs.

The Challenges Associated with Understanding Hospital Prices

The New York Times (5/16) reports that the federal government recently publicized information on hospital charges in an effort to promote transparency. These "chargemaster" prices often are not what people actually pay. For consumers to make meaningful comparisons between hospital prices, they also need to understand the rates that hospitals and insurers have negotiated and the quality of care that different hospitals provide.

Decisions about Expansion will not be Factored into Two-Year Proposed Methodology to Cut Medicaid DSH Payments

Health Leaders Media (5/14) reports that the Centers for Medicare & Medicaid Services' (CMS') proposed regulations to implement Medicaid disproportionate share hospital cuts would apply a methodology in 2014 and 2015 that does not factor in state decisions regarding Medicaid expansion. CMS plans to issue new proposed rules in 2016 to revise the proposed policy once the agency has more accurate data and a better understanding of the implications of the optional Medicaid expansion.

Graduate Medical Education Cuts Proposed in President Barack Obama's Budget Deserve More Attention

PolicyMic (5/16) highlights the importance of funding graduate medical education for teaching hospitals. President Barack Obama's budget, which serves as an important indicator of the Administration's priorities, includes proposals to cut indirect medical education (IME) payments by nearly $11 billion over 10 years and to cut the children's graduate medical education (GME) payment by $177 million. IME compensates teaching hospitals for the higher indirect patient care costs they incur while training residents, caring for sicker patients, and providing specialized tertiary services. Children's GME "helps fund training for pediatricians and other child-focused specialties." If these cuts are imposed, they could significantly hinder teaching hospitals' ability to train future doctors, reduce the number of residency positions available, and prevent hospitals from deciding to start residency programs.

*We would like to thank Allison Cohen, Esquire (Association of American Medical Colleges, Washington, DC), for providing this week's update. We would also like to thank Amy E. Kaufman, Esquire (Patton Boggs LLP, Washington, DC), for coordinating the weekly update.

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