[Congressional Record Volume 143, Number 12 (Tuesday, February 4, 1997)]
[Extensions of Remarks]
[Page E151]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




     INTRODUCTION OF LEGISLATION TO PROTECT MEDICARE BENEFICIARIES

                                 ______
                                 

                         HON. WILLIAM J. COYNE

                            of pennsylvania

                    in the house of representatives

                       Tuesday, February 4, 1997

  Mr. COYNE. Mr. Speaker, today Representative Stark and I are 
introducing legislation to correct what has become a significant 
problem for many Medicare beneficiaries. Under current law, when 
Medicare beneficiaries receive health care in a hospital outpatient 
department [HOPD], they are responsible for an average of 45 percent of 
the total payment to the hospital. Obviously, this is far more than the 
20 percent copayment that was intended when the law was first enacted.
  This problem arose because the Medicare law specifies that 
beneficiaries are responsible for 20 percent of what the hospital 
charges for services rendered in their outpatient departments, while 
Medicare only pays 80 percent of what it deems to be the reasonable 
cost for such services. Until the past few decades, costs and charges 
remained relatively the same. However, over the past few years, charges 
have risen much more rapidly than reasonable costs, causing a rapid 
rise in beneficiary coinsurance liability.
  Our legislation will correct the problem by establishing a new 
payment system for HOPD's which will allow the beneficiary copayment to 
be fixed at 20 percent of a set amount and will also ensure that 
Medicare will be paying its fair share.
  We recognize that reducing the HOPD beneficiary copayment liability 
will cause a loss in revenue for hospitals and will also cost the 
Medicare Program money as it begins to pay its fair share of HOPD 
services. We do not believe, however, that these are reasons to 
continue to force senior citizens to pay increasingly more than they 
should for HOPD services. We want to work with hospitals and with the 
Health Care Financing Administration to find a solution to this 
difficult and growing problem that faces millions of Medicare 
beneficiaries.
  Our legislation will help to soften the blow to the Medicare Program 
by simultaneously correcting a problem in how Medicare pays for some 
HOPD services. Because of a flaw in the payment formula, called the 
``formula-driven overpayment,'' Medicare has been systematically 
overpaying hospitals for many services provided in HOPD's. While 
correcting the beneficiary coinsurance problem will cost Medicare 
money, correcting the formula-driven overpayment will help to mitigate 
the loss to the program.
  I have introduced legislation in the past that would have corrected 
the beneficiary coinsurance problem. I am hopeful that this Congress 
will recognize the importance of relieving Medicare beneficiaries of 
the unfair burden they are currently shouldering when they receive 
health care in hospital outpatient departments.

                          ____________________