[Congressional Record Volume 143, Number 142 (Tuesday, October 21, 1997)]
[Extensions of Remarks]
[Page E2033]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  LEGISLATION TO IMPROVE AND SIMPLIFY HOSPITAL OUTPATIENT DEPARTMENT 
                        BILLINGS UNDER MEDICARE

                                 ______
                                 

                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                       Tuesday, October 21, 1997

  Mr. STARK. Mr. Speaker, I am introducing a bill which would provide 
for the revenue neutral payment of self-administered drugs furnished as 
part of a hospital outpatient department [HOPD] service under the 
prospective payment system currently being developed for HOPD's
  The Balanced Budget Act passed this summer starts the slow reform of 
HOPD payments by establishing a prospective payment system [PPS]. This 
PPS is designed to bring some control to the rising costs of these 
services and to ensure that the patient only pays 20 percent of the 
total cost of the HOPD service. Currently, Medicare beneficiaries are 
paying about 47 percent of the total cost of these services--far above 
the normal 20 percent Part B copayment. Unfortunately, the HOPD fix 
will take over 20 years to achieve. The long phasein was due to the 
cost of the fix to the Medicare trust fund plus its impact on hospital 
revenues.
  PPS system will include most of the costs of seeking treatment in an 
HOPD. But it will not cover the cost of self-administered 
pharmaceuticals--such as Tylenol 3--administered in the HOPD, since 
Medicare generally does not provide insurance against drugs which can 
be taken without the aid of a doctor or medical staff. Thus in addition 
to sending the patient a bill for the 20 percent HOPD copayment, the 
hospital will need to send the patient a separate bill, often for a 
rather small amount, to collect the charge for the drug.
  The American Hospital Association has suggested that this is just an 
extra wave of paperwork and that the cost of such drugs should be 
included in the total cost of the procedure as determined under the new 
PPS system. Just as pharmaceutical drugs are covered under a hospital 
inpatient admission under the DRG PPS payment system, so should HOPD 
self-administered drugs be covered under the new HOPD PPS system. The 
legislation provides that this consolidation of bills will not increase 
the total cost of the procedure. In order words, the hospitals would 
rather absorb the cost of the drug in the current cost of the procedure 
than endure the paperwork hassle of separately billing for small 
amounts.
  This proposal was sent to the BBA conferees very late in the process, 
and it was not included because more time was needed to consider it. I 
think it is a simple, straightforward proposal to simplify the life of 
patients and hospital accountants, and I hope we can include it in the 
next Medicare bill that is considered by the Congress.

                          ____________________