[Congressional Record Volume 142, Number 111 (Thursday, July 25, 1996)]
[House]
[Pages H8526-H8527]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            WEST MICHIGAN HAS LOW-COST, QUALITY HEALTH CARE

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Michigan [Mr. Ehlers] is recognized for 5 minutes.
  Mr. EHLERS. Mr. Speaker, I take the floor today to highlight two 
studies

[[Page H8527]]

that were completed by the Center for Health Affairs and the Michigan 
Health and Hospital Association regarding the excellent health care 
that is delivered in my district and throughout west Michigan. The 
studies show that west Michigan hospitals have lower costs while also 
delivering health care that is consistently equal to or better than the 
expected rates for lengths of stay and mortality. These factors 
combined help to illustrate the fact that health care in west Michigan 
is both low in cost and high in quality, and that we can serve as a 
model for national efforts to reform our health care system.
  Over the past 10 years, we have seen national consumer health care 
prices increasing significantly. Last year's increase in consumer 
health care prices of 4.5 percent was the lowest in 22 years, but this 
increase is still nearly two times the increase in overall consumer 
prices. So you can understand why a report illustrating the low cost of 
hospital care in west Michigan is an important event. These low costs 
can be attributed to several factors, but the most significant ones are 
that administrators are operating efficient hospitals, doctors are 
making responsible decisions about appropriate care, and patients are 
not over-utilizing health care resources.
  The most traditional measure of hospital resources in inpatient bed 
capacity, measured by beds per 1,000 residents. The number of beds in 
west Michigan hospitals has decreased by 26 percent over the past 10 
years. This reflects the changing philosophy in the health care sector 
toward less intrusive treatments, shorter hospital stays, the use of 
outpatient and home care, and greater emphasis on preventive care. In 
west Michigan, the number of acute care beds per 1,000 people dropped 
to 2.35 in 1993, meaning that we had 1,700 fewer beds than would be 
expected at the statewide average. And the State average is still below 
the national average of 3.3 beds per 1,000 people.
  In addition, the admission rate to acute care hospitals in west 
Michigan is 28 percent lower than the average rate across the State and 
throughout the Great Lakes region. The length of time that a person is 
expected to stay in the hospital upon admission has also 
fallen considerably in west Michigan from 1980 to 1993. The average 
length of stay at 5.3 days is over 15 percent lower than the national 
average. In terms of length of stay for selected medical cases, west 
Michigan hospitals performed better than expected in all categories. 
The days of care per 1,000 people in west Michigan is 35 percent lower 
than the days of care per 1,000 people at the national average. 
Finally, the per person operating costs in west Michigan hospitals are 
30 percent lower than the statewide average, and the expenses per 
admission are also 10 percent lower than the State expense per 
admission.

  All these statistics may be numbing, but together these data show 
that west Michigan hospitals are leading the State and the Nation in 
developing low-cost, quality hospital care. The entire health care 
community is working together in west Michigan to find ways to lower 
the cost of health care, while still increasing the quality of the 
services delivered. I applaud health care providers in my region for 
the innovation and leadership that they have demonstrated. And I would 
like to highlight two hospitals in the Third District, Blodgett 
Memorial Medical Center and Butterworth Hospital, for being recognized 
for the second year in a row as one of the top 100 hospitals in the 
Nation. Hospitals included in this report, which is conducted by HCIA, 
Inc. and Mercer Health Care Consulting, reduced expenses per adjusted 
discharge, lowered mortality, and cut length of stay. If all hospitals 
emulated this performance, hospital expenses would decline by 17 
percent, inpatient mortality would drop by 24 percent, and average 
lengths of stay would decrease by almost a day. These are the kind of 
results that we are going to need in order to decrease health care 
costs in a way that does not decrease the quality of care.
  These results will also help us address the rapidly increasing rate 
of spending in the Medicare program. The Social Security Board of 
Trustees' report for the Medicare trust fund illustrates the grim 
prognosis that the rate of increased spending poses for the Medicare 
trust fund. One way that we can slow this increase in spending is by 
utilizing alternatives to fee-for-service coverage.
  It is ironic, however, that the low cost of health care in west 
Michigan currently hinders our ability to attract Medicare managed-care 
organizations. In order to determine payments to managed care plans, 
Medicare uses a formula that is based on 95 percent of the average 
amount that Medicare pays per beneficiary for fee-for-service care. 
Low-cost areas, like west Michigan, receive dramatically lower managed 
care payments, based on this formula. As a result, the payments are too 
small to attract managed care organizations. This comes down to a basic 
issue of fairness because Medicare beneficiaries pay the same amount to 
participate in the program, but those in high-cost, high-utilization 
areas are able to access better benefits through managed care. It is 
improper that areas, such as west Michigan, that have worked hard to 
keep their medical costs low are then penalized with less adequate 
Medicare coverage. If we expect to help lower Medicare spending through 
the use of alternatives to fee-for-service coverage, we must ensure 
that managed care payments are developed in a fair manner.
  I address the House today to commend west Michigan for the low-cost 
health care that its hospitals have developed. As we proceed with 
Medicare and other health are reform, I urge this body to take steps to 
ensure that we do not penalize low-cost areas, like west Michigan, as 
they try to develop alternatives to fee-for-service coverage.

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