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Fiscal Cliff Looming, Healthcare Providers Move to Protect Funding

 |  By John Commins  
   December 06, 2012

Hospital groups and other providers this week intensified their campaigns to protect Medicare and Medicaid from drastic funding cuts that could be considered in the weeks ahead under the so-called fiscal cliff negotiations.

The American Hospital Association on Wednesday unveiled the results of its survey taken Nov. 13-15 which showed that 69% of the 800 registered voters queried—regardless of their party affiliation—oppose funding cuts to Medicare and Medicaid.

Specifically, survey respondents were asked if they would support or oppose a proposal to reduce Medicare and Medicaid funding for hospitals by more than $70 billion over 10 years, as has been proposed in the deficit reduction talks.

Of the 31% of the respondents who pointed to spending and budget issues as one of the two most important issues facing the country, 71% oppose reducing federal spending for healthcare, the survey showed.

"Nearly seven out of 10 voters reject cutting hospital funding for Medicare and Medicaid services and voters believe that if funding were reduced then access to services would decrease," AHA Executive Vice President Rick Pollack said in a conference call with reporters on Wednesday.

"We know that as part of the fiscal cliff discussions, Congress could further cut hospital funding to reduce the deficit. It is our view that these cuts would have serious implications for patients and could jeopardize access to quality care."

"It reinforces all the points we have been making about why people should be very cautious about looking at these kinds of options," Pollack says.

"It exposes a gap between what people on the policy side are looking at versus what the public is willing to accept. This just reinforces all of the messages that we’ve been sending during the lame duck [session] and presumably for the remainder of the year as they continue to grapple with these issues."

On other fronts, a broad coalition of 20 associations representing Medicare recipients, hospitals, nursing homes, and other providers sent a joint letter to President Barack Obama and Congressional leaders urging them to protect provider assessments from the budget axe.

The letter warned that cutting or eliminating Medicaid provider assessments would do little to reduce healthcare costs but would threaten access to quality care for seniors, children, individuals with disabilities and low-income families.

"Cutting provider assessments hurts patients," National Association of Public Hospitals and Health Systems President/CEO Bruce Siegel, MD, said in a media release accompanying the letter. "Congress and the administration must recognize that limiting this crucial funding stream will shift costs onto states—costs that will trickle down to providers and, ultimately, to millions of beneficiaries who rely on Medicaid."

Provider assessments allow states to generate revenue and federal matching funds for Medicaid. The assessments allow for expanded coverage and benefits and increased reimbursement rates. Recent budget proposals have suggested reducing the provider assessment threshold from 6%, or eliminating the program altogether.

Also this week, NAPH launched an advertising campaign that features short videos and related research designed to educate policymakers and the public about Medicaid's value to patients and the economy.

The advertisements stress the value of Medicaid coverage to the health of the more than 60 million people in the program, mostly children, women and the disabled.

The campaign also highlights Medicaid's value to state and local economies by keeping workers healthy and on the job and contributing to job creation and other economic activity in healthcare and related sectors.

"Medicaid is not only good for patients, it's good for communities," Siegel said in a media release announcing the campaign. "The evidence clearly shows the personal health and financial benefits of the program and its efficiency compared with private insurance and Medicare. But beyond its obvious benefits to health, Medicaid injects economic life into communities and states."

Safety net hospitals drive nearly 800,000 jobs nationwide and pump about $120 billion into state economies. Even modest cuts to Medicaid put hundreds of thousands of jobs at risk and would bleed billions of dollars in federal support to states.

Such a loss of funding would force states to turn to taxpayers for additional revenue and likely would result in hospitals ending or scaling back important community services, such as specialty care clinics, NAPH said.

The AHA survey did not ask the respondents how they would pay for the continued funding for Medicare and Medicaid.

Bill McInturff, a partner and co-founder of Public Opinion Strategies, which conducted the survey, told reporters in the teleconference that other surveys he has done recently suggest that the public would support across-the-board income tax increases before they would support cuts to Medicare and Medicaid.

"They really believe there are other options that they would support long before they would get to changes in Medicare and Medicaid, one of which would be raising taxes on people who make more than $250,000," McInturff says.

"It reflects the public’s unwillingness to want to make this change until and unless they believe lots of other things have been done first as regards to where they think these funds should come from. Voters have been very resistant to raising retirement ages and increasing taxes. Most of what has been discussed for the public policy solution does not have significant voter support."

The AHA survey found that opponents of Medicare and Medicaid funding cuts include:

  • 74% of Democrats, 58% of Independents, and 69% of Republicans;
  • 63% of men and 75% of women;
  • 71% of whites and 64% of voters of color;
  • 70% of voters under age 35, 63% of voters age 35-44, 73% of voters age 45-64, and 67% of seniors; and,
  • More than three-in-five in every region of the country

Even though the poll shows that the public does not want Congress to cut Medicaid and Medicare funding, Pollack says the programs are too big to ignore.

"A lot of that just comes down to the size of the budget," Pollack says. "When you look the whole budget and the fact that Medicare and Medicaid combined represent a big portion of federal spending, it immediately gets into the discussion in a significant way. It’s as simple as that."

The survey also shows that the public holds hospitals in high regard, with two-thirds of respondents saying they held a favorable views, and one-third have "very favorable" views of hospitals.

Only 9% of survey respondents said they had an unfavorable view of hospitals, and 21% largely said they have a mixed or half-and-half opinion. That high regard for hospitals extended across party lines, 66% of Republicans, 62% of Independents, and 70% of Democrats saying they held a favorable impression.

In stark contrast, separate polls have shown that Congress has some of the highest unfavorable ratings in its history. Averaging approval ratings of about 16%, Congress is about as popular in the United States as Fidel Castro, Hugo Chavez, and Paris Hilton.

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

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