[Congressional Record Volume 149, Number 59 (Friday, April 11, 2003)]
[Senate]
[Page S5354]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. HUTCHISON (for herself and Mr. Bayh):
  S. 899. A bill to amend title XVIII of the Social Security Act to 
restore the full market basket percentage increase applied to payments 
to hospitals for inpatient hospital services furnished to medicare 
beneficiaries, and for other purposes; to the Committee on Finance.
  Mrs. HUTCHISON. Mr. President, I am pleased to introduce legislation 
today that will increase Medicare reimbursement to hospitals. While we 
corrected in the omnibus appropriations bill the reimbursement issue 
for physicians and rural hospitals, nothing was done to assist teaching 
hospitals or give hospitals a full inflationary update. Texas hospitals 
alone are facing a loss of $53 million in 2003 due to Medicare 
reimbursement cuts.
  Hospital admissions have risen from 31 million patients in 1990 to 33 
million in 2000, and the number of days in the hospital is rising as 
well. Increased admissions, rising liability premiums, and the cost of 
advanced technology have forced hospitals to cut back on services. The 
cost of a pint of blood increased 31 percent in 2001, an additional 
$920 million burden to hospitals. Such costs are continuing to rise, 
yet Medicare reimbursements to hospitals are not keeping pace with 
inflation and their margins are slowly shrinking. Fifty-eight percent 
of hospitals are losing money on the Medicare patients they treat.
  This legislation, the American Hospital Preservation Act, restores 
the market basket update and the reimbursement for indirect medical 
education, IME, payments to teaching hospitals. The market basket 
update is an inflationary adjustment to account for the rising costs of 
goods and services, and the IME payments give teaching hospitals an 
additional Medicare reimbursement due to their higher costs of 
inpatient care. Both of these factors were cut by the Balanced Budget 
Act of 1997. Restoring the cuts means $289 million to Texas hospitals 
and $6 billion nationwide over the next five years. Major teaching 
hospitals are experiencing their lowest profit margin since the late 
'90s, 2.4 percent. Patients, especially those who are seriously ill, 
rely on teaching hospitals, which make up 78 percent of all trauma 
centers and 80 percent of all burn beds. Although only 23 percent of 
all hospitals are teaching hospitals, they deliver over two-thirds of 
charity care.
  Emergency rooms are increasingly used as a primary care clinic 
because patients cannot find a physician who accepts Medicare, and they 
are treating more individuals who are uninsured. In 2000, hospitals 
provided $21.6 billion in uncompensated care.
  Lower reimbursement rates coupled with bioterrorism risks and a 
workforce shortage make our hospitals a time bomb waiting to go off. 
Our hospitals are always open and must accept anyone who walks through 
their doors. It is our responsibility to ensure they have adequate 
resources from the Federal Government.
  I look forward to working with my colleagues to pass the American 
Hospital Preservation Act.
  I ask unanimous consent that the text 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. 899

       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 ``American Hospital 
     Preservation Act of 2003''.

     SEC. 2. RESTORING FULL MARKET BASKET UPDATE FOR INPATIENT PPS 
                   HOSPITALS.

       (a) In General.--Section 1886(b)(3)(B)(i) of the Social 
     Security Act (42 U.S.C. 1395ww(b)(3)(B)(i)) is amended--
       (1) in subclause (XVIII), by striking ``and'' at the end; 
     and
       (2) by striking subclause (XIX) and inserting the following 
     new subclauses:
       ``(XIX) for fiscal year 2004, the market basket percentage 
     increase plus 0.55 percentage points for hospitals in all 
     areas; and
       ``(XX) for fiscal year 2005 and each subsequent fiscal 
     year, the market basket percentage increase for hospitals in 
     all areas.''.
       (b) Protecting Full Market Basket Update for Fiscal Years 
     2004 and Thereafter.--Such section, as amended by subsection 
     (a), is further amended by inserting after subclause (XX) the 
     following:
     ``Notwithstanding any other provision of law, the `applicable 
     percentage increase' for any fiscal year after fiscal year 
     2005 may not be a percentage that is less than the market 
     basket percentage increase for such year.''.

     SEC. 2. FREEZING INDIRECT MEDICAL EDUCATION (IME) ADJUSTMENT 
                   PERCENTAGE AT 6.5 PERCENT.

       (a) In General.--Section 1886(d)(5)(B)(ii) of the Social 
     Security Act (42 U.S.C. 1395ww(d)(5)(B)(ii)) is amended--
       (1) in subclause (VI), by striking ``and'' at the end; and
       (2) by striking subclause (VII) and inserting the following 
     new subclauses:
       ``(VII) during fiscal year 2003, ``c'' is equal to 1.35.
       ``(VIII) during fiscal year 2004, ``c'' is equal to 1.85; 
     and
       ``(IX) on or after October 1, 2004, `c' is equal to 1.6.''.
       (b) Conforming Amendment Relating to Determination of 
     Standardized Amount.--Section 1886(d)(2)(C)(i) of such Act 
     (42 U.S.C. 1395ww(d)(2)(C)(i)) is amended--
       (1) by striking ``1999 or'' and inserting ``1999,''; and
       (2) by inserting ``, or the American Hospital Preservation 
     Act of 2003'' after ``2000''.
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