ACA Implementation Threatens Hospitals' United Front

For the most part, the nation's hospitals have presented a united front throughout the great healthcare reform debate. What’s good for one hospital is good for all, or so goes the mantra.

The public statements of the American Hospital Association and other hospital lobbies on divisive issues like the Affordable Care Act are models of measured banality. And that is a good thing.

They represent hospitals' interests on one of the most-bitter legislative battles in a generation, and have tried to remain bipartisan as best they can. That is harder than it seems when you consider that hospitals have constituents—and elected officials—in red and blue states, and in every sizeable town in the nation.

However, a couple of nettlesome issues that just won't go away could pit state hospital associations against one another, or force the hospital lobby to choose sides in a bitterly divided, locked-down Congress.

First, it appears that there is a growing rift between the AHA and House Republicans that apparently started with AHA’s support of the Affordable Care Act. AHA agreed to about $155 billion in funding cuts under ACA in exchange for expanded healthcare coverage.

That has not been forgotten by House Republicans opposed to the ACA, and who this month renewed their push for additional cuts to hospital Medicare reimbursements.

The reductions detailed in H.R. 3630 would take funding from hospitals and use it to cover the deficit created by the extensions of the Social Security tax holiday and unemployment benefits, and by the so-called "doc fix" that aims to address cuts to physician reimbursements.

AHA has issued a media release saying that the additional Medicare funding cuts under consideration in Congress, which include the cuts under mandatory sequestration, could cost the nation's hospitals $61.4 billion over the next decade, forcing them to trim their payrolls of nearly 278,000 jobs.

The Republican-controlled House Ways and Means Committee in a recent press release mocked the AHA's claims that the cuts would gravely harm the nation's hospitals.

"Not so long ago, the major hospital trade associations endorsed and strongly supported legislation that became law. It contained $155 billion in hospital Medicare cuts—more than 10 times the reductions in H.R. 3630," the GOP media release said.

When the leadership of one of the most powerful committees in the House issues a public statement ridiculing your fears, brace yourself. For House Republicans, it's payback time. 

And then there is the "rural floor" issue and the Massachusetts Hospital Association’s exploitation of a loophole in the byzantine ACA bill that would give Bay State hospitals an additional $367 million in annual Medicare funding. That funding, only for Massachusetts acute care facilities, would be taken from Medicare funding for hospitals in the 49 other states, and those states are not happy about it.

The issue first came to light in August, and many state hospital associations are still quite incensed. Last week, the leaders of 19 state hospital associations complained in a letter to President Obama that Massachusetts' "manipulation" of the ACA would come at the expense of every other state. They asked the president to remove the loophole from his 2013 budget. 

MHA defended the windfall and said in a statement that it  "followed all the rules regarding the rural floor regulations."

So, state hospital associations that are supposed to wage the home front battles to preserve funding are instead fighting amongst themselves.

At the same time, the AHA's support for ACA has placed hospitals in the crosshairs for more funding cuts from an avenging Republican majority with an axe to grind.

At a time when hospitals need to project a united and bipartisan front as funding comes under attack, neither of these developments is healthy.