[Congressional Record Volume 152, Number 18 (Tuesday, February 14, 2006)]
[Extensions of Remarks]
[Pages E135-E136]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    U.S. BUDGET CUTS WORRY HOSPITALS

                                 ______
                                 

                           HON. BARNEY FRANK

                            of massachusetts

                    in the house of representatives

                       Tuesday, February 14, 2006

  Mr. FRANK of Massachusetts. Mr. Speaker, in the February 8 issue of 
the Sun Chronicle, published in Attleboro, Massachusetts, there is a 
very good article about the reaction of hospitals to the President's 
proposal to change the Medicare law so that future spending would be 
less on Medicare than it otherwise would be.
  In particular, the article quotes Linda Shyavitz, who is the 
president and CEO of Sturdy Memorial Hospital, an excellent medical 
facility that serves a very important and diverse population in the 
city of Attleboro.
  Reading the article, including the comments of Ms. Shyavitz, 
reinforced my view that these proposed changes that the President has 
put forward are ill advised and would do social damage. I think it is 
important for Members to understand what people who are charged with 
important responsibilities think about these proposed reductions in 
future spending patterns that the President has called for, and because 
Ms. Shyavitz is an extremely well-qualified and thoughtful 
administrator of a very important medical facility, I was particularly 
pleased to have this chance to share her views with our colleagues.

                 [From the Sun Chronicle, Feb. 8, 2006]

                    U.S. Budget Cuts Worry Hospitals

                          (By Gloria LaBounty)

       Attleboro.--Hospital administrators are keeping a wary eye 
     on Congress as it plows through the Bush administration's's 
     proposed cuts in Medicare.
       ``I think hospitals all over the country will be fighting 
     this,'' said Linda Shyavitz, president and chief executive 
     officer of Sturdy Memorial Hospital in Attleboro.
       According to initial reports, Bush's new $2.7 trillion 
     budget plan would mean a loss in Massachusetts of $758 
     million in Medicaid funds.
       It would also mean a reduction of $213 million in Medicare 
     payments to health-care providers over five years.
       The Medicaid impact is still vague, however, because the 
     state is redesigning its program, the Massachusetts Hospital 
     Association says.
       The Medicare piece already has hospitals concerned.
       Although information so far has been presented in broad 
     terms and details are still days away, Shyavitz said 
     indications are that the proposal could mean a reduction to 
     Sturdy of $575,000 per in Medicare payments.
       All elderly patients would still be cared for at Sturdy, 
     but the hospital would get less reimbursement for the care it 
     provides. Shyavitz said.
       Asked how the hospital would compensate for the loss in 
     revenue, Shyavitz said it would be premature to speculate 
     because the information has just come out and the president's 
     intentions are still being absorbed.
       But she said what hospitals will do in the short term is 
     urge members of Congress to reject the cuts and not support 
     the budget.
       Paul Wingle, senior director of communications for the 
     state hospital association or MHA, said the Medicare cuts 
     would put a financial strain on hospitals, and more of them 
     would serve patients at a loss, or at a very thin margin.

[[Page E136]]

       ``Hospitals would have to scramble to make up the loss,'' 
     he said, and some might do that through cutbacks, or through 
     attempts to make up the revenue elsewhere.
       That in turn creates pressure for rate increases.
       Shyavitz said hospitals cannot simply raise rates, and 
     would have to negotiate increases with health insurance 
     companies. But she said many hospitals will want to do that 
     if the cuts materialize.
       Shyavitz said she is confident that Massachusetts 
     congressmen and senators, including Sen. John Kerry and Sen. 
     Edward Kennedy, and U.S. Reps. James McGovern and Barney 
     Frank. will oppose the cuts.
       Kennedy has already spoken out by telling the Associated 
     Press that Bush's budget proposal ``shortchanges our 
     competitiveness, shortchanges our opportunity, and 
     shortchanges our future.''

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