[Congressional Record Volume 145, Number 121 (Thursday, September 16, 1999)]
[Senate]
[Page S11058]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BAUCUS:
  S. 1601. A bill to amend title XVIII of the Social Security Act to 
exclude small rural providers from the prospective payment system for 
hospital outpatient department services; to the Committee on Finance.


                    small rural provider act of 1999

  Mr. BAUCUS. Mr. President, I rise today to introduce the Small Rural 
Provider Act of 1999.
  Small, rural hospitals have always played a vital role in ensuring 
access to quality health care. Today, rural hospitals are as important 
as ever. Half of all American hospitals are in rural areas, and these 
institutions account for fully one-quarter of the hospital beds in our 
country. And rural hospitals across America are expanding and improving 
their services, from disease prevention to rehabilitation to outpatient 
surgery.
  But if the outpatient prospective payment system (PPS) goes into 
effect as currently proposed, rural hospitals in Montana and across the 
nation will lose millions of dollars in Medicare payments each year. 
Some of our smallest hospitals--the ones we should be supporting the 
most--will lose more than half of their current payments. That's just 
not right, and we should pass legislation to fix it.
  Why does the outpatient PPS pose such a threat to small, rural 
hospitals? As you know, Mr. President, instead of reimbursing hospitals 
for the actual costs that they incur, a PPS would pay hospitals on a 
fixed, limited rate. That might make sense for a large hospital in 
Chicago or New York City that sees thousands of patients every day. But 
it doesn't make sense for a small hospital that doesn't enjoy the same 
economies of scale. It certainly doesn't make sense for Madison Valley 
Hospital, in Ennis, Montana, which would face an estimated 62.6 percent 
cut in outpatient payments under PPS.
  Mr. President, how can small, rural hospitals, already struggling to 
improve their services with limited funds, survive and operate with 
half as much money? How can hospitals that rely on Medicare patients 
for most of their revenue endure a 50 percent pay-cut? The simple 
answer is: they cannot.
  And let's remember, Mr. President, many of these hospitals are home 
to skilled nursing facilities (SNFs) and home health agencies (HHAs). 
These are the same SNFs and HHAs that have already been harmed by new 
prospective payment systems of their own.
  This is a very simple bill. It would allow small, rural hospitals to 
opt out of the outpatient PPS. Without this bill, hospitals all across 
rural America will face devastating shortfalls in the coming year--and 
the quality of our country's health care will suffer. With this bill, 
the small hospitals that serve rural Americans throughout the nation 
can continue to improve the quality of their services.
  Passing this bill is the right thing to do, and I urge my colleagues 
to join me in supporting it.
  Mr. President, I ask unanimous consent that a copy of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1601

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Small Rural Provider Act of 
     1999''.

     SEC. 2. EXCLUSION OF SMALL RURAL PROVIDERS FROM PPS FOR 
                   HOSPITAL OUTPATIENT DEPARTMENT SERVICES.

       (a) In General.--Section 1833(t)(1) of the Social Security 
     Act (42 U.S.C. 1395l(t)(1)) is amended--
       (1) in subparagraph (B), by striking ``For purposes of 
     this'' and inserting ``Subject to subparagraph (C), for 
     purposes of this''; and
       (2) by adding at the end the following:
       ``(C) Exclusion for services furnished by small rural 
     providers.--The term `covered OPD services' does not include 
     services furnished by a--
       ``(i) medicare-dependent, small rural hospital, as defined 
     in section 1886(d)(5)(G)(iv);
       ``(ii) a critical access hospital, as defined in section 
     1861(mm)(1);
       ``(iii) sole community hospital, as defined in section 
     1886(d)(5)(D)(iii); or
       ``(iv) a hospital (determined as of the date of enactment 
     of the Small Rural Provider Act of 1999) that--
       ``(I) has less than 50 beds; and
       ``(II) performed less than 5,000 outpatient procedures 
     during the 12-month period ending on such date;
     if such hospital, within the 180-day period beginning on the 
     date of enactment of the Small Rural Provider Act of 1999, 
     requests the Secretary to exclude services furnished by such 
     hospital from the prospective payment system established 
     under this subsection.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall take effect as if included in the enactment of the 
     Balanced Budget Act of 1997.

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