[Congressional Record Volume 143, Number 35 (Tuesday, March 18, 1997)]
[Extensions of Remarks]
[Pages E499-E500]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




IN SUPPORT OF H.R. 582: THE MEDICARE HOSPITAL OUTPATIENT REFORM ACT OF 
                                  1997

                                 ______
                                 

                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                        Tuesday, March 18, 1997

  Mr. STARK. Mr. Speaker, on February 4, Representive Coyne and myself 
introduced a bill to provide for an immediate correction of a serious 
Medicare beneficiary problem: the overcharging of seniors and the 
disabled by Hospital Outpatient Departments [HOPD].
  The President's budget also calls for a correction of this problem, 
but phases in the correction over a 10-year period.
  In Medicare, the program generally pays 80 percent of Part B bills 
and the patient pays 20 percent. But because of the way the HOPD 
benefit was drafted, currently beneficiaries are paying about 45 
percent and Medicare 55 percent. Simply put, the problem arises because 
Medicare pays the hospital on the basis of reasonable cost, while the 
beneficiary is stuck with 20 percent of charges--and charges can be 
anything the hospital wants to say they are.
  Last the American Association of Retired Persons asked its members 
for examples of problems they had had with HOPD billings. They received 
an overwhelming response, and over the coming weeks, I would like to 
enter some of these letters in the Record.
  These examples are the proof of why we need to fix this problem ASAP.
  The first is from Mr. Warren Risser of Santa Barbara, who had an HOPD 
cataract operation and was charged $4,102.15. His 20 percent share of 
that change was $820.43. But he found out that Medicare determined the 
reasonable cost was less than half of that and Medicare paid $1,025.54. 
Mr. Risser paid 44% of the total payment--a far cry from Medicare's 
promise of an 80-20 split.
  Next is a letter from Mr. Keith Roberts of Garden Valley, CA. As his 
letter so well explains, he paid 54 percent of a test due to charges 
that defy all rhyme or reason.
  Both letters are a testament to the need to pass H.R. 582.
     AARP Outpatient Stories,
     Washington, DC.
       Dear Sirs: Your article ``Medicare Outpatient Debacle'' by 
     Don McLeod was excellent.
       On March 7, 1995, I had cataract surgery on my right eye. I 
     was in the hospital approximately 6 hours incurring a 
     hospital bill of $4,102.15. I was billed 20 percent 
     ($820.43). The Medicare Statement from Blue Cross shows 
     Medicare paid the balance of $3,281.72 which was incorrect. 
     They paid only $1,025.54 after writing off an adjustment of 
     $2,256.18.
       I wrote Blue Cross stating I paid my 20 percent and they 
     paid 25 percent and requested an explanation. Enclosed is 
     their response. They had lowered their portion by 55 percent 
     of the bill.
       Gosh, I wish I could run a business this way.
       Keep up your good work.
           Sincerely,
                                                  Warren H. Risser
     Santa Barbara, CA.
                                                                    ____



                                             Keith L. Roberts,

                             Garden Valley, CA, November 27, 1996.
     AARP Outpatient Stories Dept.,
     Washington, DC.
       Dear Sirs: Some time back I sent you a large packet of 
     documents and correspondence about Part B Outpatient 
     overcharges. I just received another example of Part B 
     outpatient abuse which I am forwarding to you.
       In this case, the total hospital charge is $1199.00. I have 
     requested an itemized account of the charges so that I can 
     know whether they are legitimate or not. The Medicare 
     statement lists two items. They are: PHARMACY . . . 211.90, 
     OTHER . . . 988.00. The hospital statement lists: BALANCE 
     FORWARD . . . 1199.00, A CODE (99100) . . . (203.80-, ANOTHER 
     CODE (97010) . . . 755.37-. The balance due to patient is 
     239.80 (or 20% of the total 1199.00).
       I have obtained a detail listing of the hospital charges I 
     referred to above. I have edited the list of charges by 
     assigning an item number and true patient charge for each 
     item. Both lists are included herewith.
       In items 10 and 11 are two drugs, DEMEROL and MIDAZOLAM. If 
     the hospital charges are extended out to a kilogram, the drug 
     dealers preferred lot size, you find that a kilo of MIDAZOLAM 
     goes for 9.2 million dollars ($9,000,000.00) while the 
     DEMEROL goes for a mere $550,000.00.
       I made a special effort to find out about the most 
     expensive item on the list, item 15, entitled SPECIAL 
     PROCEDURE 3. It sounded like a ``miscellaneous'' item to me. 
     I have been told in the past never accept a miscellaneous 
     charge. I was told that it was probably ``the room charge''. 
     I inquired ``why not call it a room charge''. On my oath I 
     swear that I was told ``maybe Medicare pays more for special 
     procedures.'' The record should show that the only ``room'' 
     she was in was the outpatient preparation and recovery ward 
     of about 10 or 12 beds.
       So the bottom line is that Medicare considers the rooms, 
     nurses, equipment and supplies to be worth something a little 
     more than $203.80. Based on that amount, I find it hard to 
     believe that 1199.00 is realistic. As you and I both know 
     that there is no limit to the amount that the hospital can 
     charge. They could have legally charged $599.00 or $1999.00 
     or more. It appears that in this case they charged an amount 
     that they thought would pass the stink test.
       Of the money that the hospital stands to receive, I will 
     pay 54% and Medicare will only pay 45%. We need to convert to 
     a payment system more nearly like non-hospital Medicare part 
     B payments.

[[Page E500]]

       WHEN MEDICARE IS REFORMED, THE OUTPATIENT SCHEDULE MUST BE 
     INCLUDED!
           Sincerely,
     Keith L. Roberts.

                          ____________________