[Congressional Record Volume 155, Number 13 (Thursday, January 22, 2009)]
[Senate]
[Pages S787-S792]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. GRASSLEY (for himself, Mr. Kohl, and Ms. Klobuchar):
S. 301. A bill to amend title XI of the Social Security Act to
provide for transparency in the relationship between physicians and
manufacturers of drugs, devices, biologicals, or medical supplies for
which payment is made under Medicare, Medicaid, or SCHIP; to the
Committee on Finance.
Mr. GRASSLEY. Mr. President, I rise to introduce a bill today. Over
the past several years, I have worked to establish greater transparency
in the financial relationships and financial disclosure requirements
between physicians and manufacturers of drugs, of biologics, and
medical devices.
In the last Congress, the 110th, Senator Herb Kohl of Wisconsin and I
introduced what is entitled the Physician Payments Sunshine Act, which
is intended to bring some much-needed transparency to these
relationships between physicians and manufacturers.
To explain why this bill is so important, let me point to a number of
investigations I have conducted in the depth and scope of these
relationships between physicians on the one hand, and manufacturers of
drugs, biologics, and medical devices on the other hand.
My findings to date are troubling and reveal significant undisclosed
financial ties between physicians and industry. Some examples: These
relationships, at times, resulted in annual incomes of over $1 million
to individual physicians from just one company.
[[Page S788]]
Another example. My investigations determined that several prominent
physicians at major universities had failed to disclose large sums of
money to their research institutions. That was despite institutional as
well as Federal requirements that these reportings take place.
This was also despite these physicians' involvement with Federal
research study products made by the various drugmakers with whom they
have financial relationships.
This Federal research has involved billions of dollars in taxpayers'
money to fund this research.
My oversight has confirmed the need for a consistent, easy-to-
understand national system of disclosure, as opposed to a patchwork of
disclosure requirements at State and institutional levels, although I
compliment States that have such laws on the books.
Today I am here to introduce, along with Senator Kohl, the Physician
Payment Sunshine Act of 2009. The Physician Payment Sunshine Act would
require that manufacturers of drugs, biologics, and medical devices
disclose, on an annual basis, any financial relationships that they
have with physicians. That information would be posted online by the
Secretary of Health and Human Services in a format that is searchable,
that would be clear and easy for the public to understand.
Whether the relationship is as simple as buying a doctor's dinner or
as complex as a multimillion-dollar consulting arrangement, these
relationships may affect prescribing practices and may influence
research.
More importantly, they can obscure the most important issue existing
between doctors and patients, and that is a question every doctor and
patient has to consider: What is best for the patient?
This legislation Senator Kohl and I are introducing today closely
parallels the version I circulated last year and follows some recent
MedPAC recommendations.
MedPAC recommended a lower annual reporting threshold of $100--in the
previous bill, it was higher--no de minimis exceptions for payments and
a tighter preemption provision.
MedPAC will publish their final recommendations in their March report
to Congress. I will take those recommendations into consideration and
intend to continue pursuing policies that go beyond the transparency in
health care than even the existing bill does.
There is a greater need for this legislation, and that greater need
is demonstrated by a witness testifying at the Finance Committee
hearing on health reform last year that industry and physician
relationships are pervasive.
Drug and device companies spend billions and billions every year on
marketing, product development, and research, and much of this money
goes directly to doctors.
Last year, the Des Moines Register wrote:
Your doctor's hand may be in the till of a drug company. So
how can you know whether the prescription he or she writes is
in your interest or the best interest of a drug company?
That is a pretty good question that we all ought to be looking at.
Many of these relationships are beneficial and appropriate. That is
why we don't outlaw any of these relationships. What we do is make them
be reported. And some of these should be reported on a more regular
basis than they are even without this legislation.
Physicians play important roles in inventing and refining new devices
or in conducting medical research. They are hired to educate other
doctors. We don't do anything in this legislation to end those
professional relationships.
But as is often the case, a few bad apples can spoil the whole
barrel. It is clear Congress needs to act now to pass disclosure
legislation.
Currently, drug and device makers have to comply with a number of
State requirements, each State giving its own definition and own rules.
Patients as well as other doctors have no way to learn about these
important relationships. This information should not only be available
to those few Americans lucky enough to live in a State already
requiring some level of disclosure.
Even in the States currently requiring disclosure, most do not apply
that law to medical device companies. Some States do not even make
public the information they collect, which is of little value to
patients who might want to know if their doctors have a relationship
with a drug company or a medical device company about which they ought
to know.
Now, this bill isn't adding new burdens to the industry. By creating
a central reporting system, the legislation actually relieves burdens.
In addition, I am hopeful that this bill will enjoy the same wide-
ranging support as the prior legislation that Senator Kohl and I put in
during the 110th Congress.
I want to be clear--and this is the second time I am being clear on
this point--this legislation does not regulate the business of drug and
device companies. Let the people in industry do their business since
they have the training and the skills to get the job done. But keep the
American people apprised of the business you are doing and how you are
doing it. After all, what is at risk isn't merely private interest but
the health and well-being of all Americans who depend upon the drugs
and medical devices to sustain and to improve their lives.
In this process of what we call transparency, in this process that we
call sunshine legislation, I often quote from an opinion of Justice
Brandeis, I think in 1914, where he said: ``Sunlight is the best
disinfectant.'' And that is what Senator Kohl and I are aiming to
accomplish with this Physician Payment Sunshine Act, just a little
sunlight so the public is better informed.
Mr. KOHL. Mr. President, I rise today to reintroduce the Physician
Payments Sunshine Act, along with my colleague Senator Grassley. This
legislation will be a great step forward in increasing transparency of
the relationships between pharmaceutical and medical device companies
and our Nation's physicians, for the benefit of their patients.
I want to begin by underscoring the fact that industry payments to
physicians for research purposes or products they have helped develop
are completely legitimate. Medical breakthroughs as a result of
research have saved countless lives and could not have been achieved
without the diligence of these me cal professionals. We must
acknowledge, however, that conflicts of interest do exist in some
cases. Transparency will help to illuminate the difference between
legitimate and questionable relationships.
It has been estimated that the drug industry spends $19 billion
annually on marketing to physicians in the form of gifts, lunches, drug
samples and sponsorship of education programs. Americans pay the price
as through unnecessarily high drug costs and skyrocketing health
insurance premiums. Rising drug prices hurt us all by undermining our
private and public health systems, including Medicare and Medicaid.
Even more alarming is the notion that these gifts and payments can
compromise physicians' medical judgment by putting their financial
interest ahead of the welfare of their patients. Recent studies show
that the more doctors interact with drug marketers, the more likely
doctors are to prescribe the expensive new drug that is being marketed
to them.
As a businessman, I understand that companies have the right to spend
as much as they choose to promote their products. But as the largest
payer of prescription drug costs, the Federal Government has an
obligation to examine and take action when companies attempt to
manipulate the market.
I believe the Physician Payments Sunshine Act presents a long overdue
solution to combat this potentially harmful influence. The legislation
would require manufacturers of pharmaceutical drugs, devices and
biologics to disclose the amount of money they give to doctors through
payments, gifts, honoraria, travel and other means. These disclosures
would be registered in a national, publicly accessible online database,
managed by the U.S. Department of Health and Human Services. Those
companies who fail to report will be subject to financial penalty.
In the year and a half since the Sunshine bill was first introduced,
several States have passed their own laws forcing disclosure, and
several leading pharmaceutical companies have voluntarily implemented
disclosure guidelines. A comprehensive national bill would create a
one-stop information
[[Page S789]]
vault, here patients could easily gain access to data about these
relationships. It is my hope that this online database will encourage
patients to discuss any concerns they may have with their doctors.
A great deal of money changes hands in the health care field, and a
good percentage of it is helping Americans live healthier lives. The
Physician Payments Sunshine Act will provide the transparency necessary
to raise that percentage. We deserve nothing less.
______
By Mr. VOINOVICH (for himself, Mr. Lieberman, and Mr. Carper):
S. 303. A bill to reauthorize and improve the Federal Financial
Assistance Management Improvement Act of 1999; to the Committee on
Homeland Security and Governmental Affairs.
Mr. VOINOVICH. Mr. President, I rise today to introduce the Federal
Financial Assistance Management Improvement Act of 2009 with Senator
Lieberman and Senator Carper.
When I came to the Senate in 1999, I introduced the Federal Financial
Assistance Management Improvement Act of 1999 with Senators Lieberman,
Thompson and Durbin because as a former mayor and governor, I had seen
first-hand the problems and complications that existed in the federal
grant making process.
Congress enacted our legislation to improve the effectiveness and
performance of Federal financial assistance programs, simplify Federal
financial assistance application and reporting requirements, improve
the delivery of services to the public and coordinate the delivery of
those services, and progress was made under the law, which is commonly
known as ``P.L. 106-107.'' A 2005 Government Accountability Office,
GAO, report noted that ``[m]ore than 5 years after passage of P.L. 106-
107, cross-agency work groups have made some progress in streamlining
aspects of the early phases of the grants life cycle and in some
specific
aspects of overall grants management . . . .'' However, GAO also noted
that work remained to be done and in 2006 suggested that Congress
consider reauthorizing the Federal Financial Assistance Management
Improvement Act of 1999, which expired in 2007.
I believe that Congress should heed GAO's advice and reauthorize this
important law, so last year I introduced S. 3341 with Senator Lieberman
to reauthorize the Federal Financial Assistance Management Improvement
Act and make improvements to that Act based on the 2005 and 2006
recommendations of GAO. The bill passed the Senate in September 2008.
Today we are reintroducing that legislation, which requires the
Director of the Office of Management and Budget, OMB, to improve the
grants.gov website or develop another public website that allows grant
applicants to search and apply for grants, report on the use of grants,
and provide required certifications and assurances for grants. I
believe such a website will enhance the transparency required by the
Federal Funding Accountability and Transparency Act that Congress
enacted in 2007.
The bill also requires the Director of OMB to develop a strategic
plan for an end-to-end electronic capability for non-Federal entities
to manage the Federal financial assistance they receive and requires
each Federal agency to plan actions to implement that strategic plan.
Each federal agency would be required to report to OMB on progress made
in achieving its objectives under the OMB strategic plan, and the
Director of OMB would be required to report to Congress biennially on
progress made in implementing the Federal Financial Assistance
Management Improvement Act.
In 1999 I said the Federal Financial Assistance Management
Improvement Act was an important step toward detangling the web of
duplicative Federal grants available to States, localities and
community organizations. Last year I said that while some progress was
made under that law to detangle the web, work remained to be done. I
hope that Congress will quickly reauthorize this law so that OMB and
Federal agencies continue their efforts to simplify and streamline the
Federal grant process.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 303
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 ``Federal Financial Assistance
Management Improvement Act of 2009''.
SEC. 2. REAUTHORIZATION.
Section 11 of the Federal Financial Assistance Management
Improvement Act of 1999 (31 U.S.C. 6101 note) is amended--
(1) in the section heading, by striking ``and sunset''; and
(2) by striking ``and shall cease to be effective 8 years
after such date of enactment''.
SEC. 3. WEBSITE RELATING TO FEDERAL GRANTS.
Section 6 of the Federal Financial Assistance Management
Improvement Act of 1999 (31 U.S.C. 6101 note) is amended--
(1) by redesignating subsections (e) and (f) as subsections
(f) and (g), respectively;
(2) by inserting after subsection (d) the following:
``(e) Website Relating to Federal Grants.--
``(1) In general.--The Director shall establish and
maintain a public website that serves as a central point of
information and access for applicants for Federal grants.
``(2) Contents.--To the maximum extent possible, the
website established under this subsection shall include, at a
minimum, for each Federal grant--
``(A) the grant announcement;
``(B) the statement of eligibility relating to the grant;
``(C) the application requirements for the grant;
``(D) the purposes of the grant;
``(E) the Federal agency funding the grant; and
``(F) the deadlines for applying for and awarding of the
grant.
``(3) Use by applicants.--The website established under
this subsection shall, to the greatest extent practical,
allow grant applicants to--
``(A) search the website for all Federal grants by type,
purpose, funding agency, program source, and other relevant
criteria;
``(B) apply for a Federal grant using the website;
``(C) manage, track, and report on the use of Federal
grants using the website; and
``(D) provide all required certifications and assurances
for a Federal grant using the website.''; and
(3) in subsection (g), as so redesignated, by striking
``All actions'' and inserting ``Except for actions relating
to establishing the website required under subsection (e),
all actions''.
SEC. 4. REPORT ON IMPLEMENTATION.
The Federal Financial Assistance Management Improvement Act
of 1999 (31 U.S.C. 6101 note) is amended by striking section
7 and inserting the following:
``SEC. 7. EVALUATION OF IMPLEMENTATION.
``(a) In General.--Not later than 9 months after the date
of enactment of the Federal Financial Assistance Management
Improvement Act of 2009, and every 2 years thereafter until
the date that is 15 years after the date of enactment of the
Federal Financial Assistance Management Improvement Act of
2009, the Director shall submit to Congress a report
regarding the implementation of this Act.
``(b) Contents.--
``(1) In general.--Each report under subsection (a) shall
include, for the applicable period--
``(A) a list of all grants for which an applicant may
submit an application using the website established under
section 6(e);
``(B) a list of all Federal agencies that provide Federal
financial assistance to non-Federal entities;
``(C) a list of each Federal agency that has complied, in
whole or in part, with the requirements of this Act;
``(D) for each Federal agency listed under subparagraph
(C), a description of the extent of the compliance with this
Act by the Federal agency;
``(E) a list of all Federal agencies exempted under section
6(d);
``(F) for each Federal agency listed under subparagraph
(E)--
``(i) an explanation of why the Federal agency was
exempted; and
``(ii) a certification that the basis for the exemption of
the Federal agency is still applicable;
``(G) a list of all common application forms that have been
developed that allow non-Federal entities to apply, in whole
or in part, for multiple Federal financial assistance
programs (including Federal financial assistance programs
administered by different Federal agencies) through a single
common application;
``(H) a list of all common forms and requirements that have
been developed that allow non-Federal entities to report, in
whole or in part, on the use of funding from multiple Federal
financial assistance programs (including Federal financial
assistance programs administered by different Federal
agencies);
``(I) a description of the efforts made by the Director and
Federal agencies to communicate and collaborate with
representatives
[[Page S790]]
of non-Federal entities during the implementation of the
requirements under this Act;
``(J) a description of the efforts made by the Director to
work with Federal agencies to meet the goals of this Act,
including a description of working groups or other structures
used to coordinate Federal efforts to meet the goals of this
Act; and
``(K) identification and description of all systems being
used to disburse Federal financial assistance to non-Federal
entities.
``(2) Subsequent reports.--The second report submitted
under subsection (a), and each subsequent report submitted
under subsection (a), shall include--
``(A) a discussion of the progress made by the Federal
Government in meeting the goals of this Act, including the
amendments made by the Federal Financial Assistance
Management Improvement Act of 2009, and in implementing the
strategic plan submitted under section 8, including an
evaluation of the progress of each Federal agency that has
not received an exemption under section 6(d) towards
implementing the strategic plan; and
``(B) a compilation of the reports submitted under section
8(c)(3) during the applicable period.
``(c) Definition of Applicable Period.--In this section,
the term `applicable period' means--
``(1) for the first report submitted under subsection (a),
the most recent full fiscal year before the date of the
report; and
``(2) for the second report submitted under subsection (a),
and each subsequent report submitted under subsection (a),
the period beginning on the date on which the most recent
report under subsection (a) was submitted and ending on the
date of the report.''.
SEC. 5. STRATEGIC PLAN.
(a) In General.--The Federal Financial Assistance
Management Improvement Act of 1999 (31 U.S.C. 6101 note) is
amended--
(1) by redesignating sections 8, 9, 10, and 11 as sections
9, 10, 11, and 12, respectively; and
(2) by inserting after section 7, as amended by this Act,
the following:
``SEC. 8. STRATEGIC PLAN.
``(a) In General.--Not later than 18 months after the date
of enactment of the Federal Financial Assistance Management
Improvement Act of 2009, the Director shall submit to
Congress a strategic plan that--
``(1) identifies Federal financial assistance programs that
are suitable for common applications based on the common or
similar purposes of the Federal financial assistance;
``(2) identifies Federal financial assistance programs that
are suitable for common reporting forms or requirements based
on the common or similar purposes of the Federal financial
assistance;
``(3) identifies common aspects of multiple Federal
financial assistance programs that are suitable for common
application or reporting forms or requirements;
``(4) identifies changes in law, if any, needed to achieve
the goals of this Act; and
``(5) provides plans, timelines, and cost estimates for--
``(A) developing an entirely electronic, web-based process
for managing Federal financial assistance, including the
ability to--
``(i) apply for Federal financial assistance;
``(ii) track the status of applications for and payments of
Federal financial assistance;
``(iii) report on the use of Federal financial assistance,
including how such use has been in furtherance of the
objectives or purposes of the Federal financial assistance;
and
``(iv) provide required certifications and assurances;
``(B) ensuring full compliance by Federal agencies with the
requirements of this Act, including the amendments made by
the Federal Financial Assistance Management Improvement Act
of 2009;
``(C) creating common applications for the Federal
financial assistance programs identified under paragraph (1),
regardless of whether the Federal financial assistance
programs are administered by different Federal agencies;
``(D) establishing common financial and performance
reporting forms and requirements for the Federal financial
assistance programs identified under paragraph (2),
regardless of whether the Federal financial assistance
programs are administered by different Federal agencies;
``(E) establishing common applications and financial and
performance reporting forms and requirements for aspects of
the Federal financial assistance programs identified under
paragraph (3), regardless of whether the Federal financial
assistance programs are administered by different Federal
agencies;
``(F) developing mechanisms to ensure compatibility between
Federal financial assistance administration systems and State
systems to facilitate the importing and exporting of data;
``(G) developing common certifications and assurances, as
appropriate, for all Federal financial assistance programs
that have common or similar purposes, regardless of whether
the Federal financial assistance programs are administered by
different Federal agencies; and
``(H) minimizing the number of different systems used to
disburse Federal financial assistance.
``(b) Consultation.--In developing and implementing the
strategic plan under subsection (a), the Director shall
consult with representatives of non-Federal entities and
Federal agencies that have not received an exemption under
section 6(d).
``(c) Federal Agencies.--
``(1) In general.--Not later than 6 months after the date
on which the Director submits the strategic plan under
subsection (a), the head of each Federal agency that has not
received an exemption under section 6(d) shall develop a plan
that describes how the Federal agency will carry out the
responsibilities of the Federal agency under the strategic
plan, which shall include--
``(A) clear performance objectives and timelines for action
by the Federal agency in furtherance of the strategic plan;
and
``(B) the identification of measures to improve
communication and collaboration with representatives of non-
Federal entities on an on-going basis during the
implementation of this Act.
``(2) Consultation.--The head of each Federal agency that
has not received an exemption under section 6(d) shall
consult with representatives of non-Federal entities during
the development and implementation of the plan of the Federal
agency developed under paragraph (1).
``(3) Reporting.--Not later than 2 years after the date on
which the head of a Federal agency that has not received an
exemption under section 6(d) develops the plan under
paragraph (1), and every 2 years thereafter until the date
that is 15 years after the date of enactment of the Federal
Financial Assistance Management Improvement Act of 2009, the
head of the Federal agency shall submit to the Director a
report regarding the progress of the Federal agency in
achieving the objectives of the plan of the Federal agency
developed under paragraph (1).''.
(b) Technical and Conforming Amendment.--Section 5(d) of
the Federal Financial Assistance Management Improvement Act
of 1999 (31 U.S.C. 6101 note) is amended by inserting ``,
until the date on which the Federal agency submits the first
report by the Federal agency required under section 8(c)(3)''
after ``subsection (a)(7)''.
______
By Mr. DORGAN:
S. 304. A bill to amend the Internal Revenue Code of 1986 to
stimulate business investment, and for other purposes; to the Committee
on Finance.
Mr. DORGAN. Mr. President, today I am introducing legislation called
the Main Street Recovery Act to boost business investment and help
jumpstart the ailing U.S. economy. We are facing our most serious
financial challenge since the Great Depression and we must respond
aggressively. Our financial services sector is in shambles and other
business sectors are suffering.
Employers have been slashing jobs at an alarming rate--including 2.6
million jobs last year--to reduce operating costs. Some economists are
predicting that the unemployment rate could jump to 10-percent or more
this year in many parts of the country.
The manufacturing and construction sectors have been particularly
hard hit during this downturn. The manufacturing sector laid off
791,000 workers in 2008. The unemployment rate among construction
workers in December was 15.3 percent, eight percentage points higher
than for the economy as a whole. More than 1.4 million experienced
construction workers are currently unemployed.
I believe immediate action is needed to prevent our economy from
sliding into a deeper recession that would lead to more bankrupt
businesses and massive layoffs of workers across the country. That is
why I will support a stimulus program that will create jobs by
investing in infrastructure projects such as roads, bridges, water
projects and more.
But I also think we need to provide some targeted tax incentives to
encourage the business community to consider making capital investments
even during the economic slowdown. The legislation I am introducing
today includes the following tax incentives that I believe can
stimulate business investment: a temporary 15-percent investment tax
credit. To encourage manufacturers and producers not to wait on making
crucial equipment and machinery purchases, we should give them every
incentive to make these purchases now or in the near future when these
investments will most benefit the economy.
We can accomplish this by offering a temporary, 15-percent tax credit
through June 30, 2010 for businesses that purchase new equipment and
machinery that is used as an integral part of manufacturing or
production. Investment tax credits have been proven to work and will
help generate growth and jobs in the nation's manufacturing and
construction sectors.
Enhanced 50-percent bonus depreciation. To promote business
investment now, when the economy needs it most,
[[Page S791]]
we should extend the expiring 50-percent bonus depreciation for
eligible assets placed in service over the next 18 months. This will
help businesses make capital investments during the economic downturn
by allowing businesses to write-off a larger share of their eligible
business investments more quickly from their federal income taxes.
Increased $250,000 small business expensing. To help small businesses
buy the equipment and machinery they need to weather this economic
storm and begin to grow again, we should extend the expiring expensing
provision that allows small businesses to expense, i.e. immediately
deduct, up to $250,000 of their equipment and machinery purchases over
the next year and a half.
In addition, there are many business owners that do not require new
equipment or machinery but instead want to build a new business--maybe
a restaurant, perhaps a retail shop or make interior and other
improvements to such properties. Expanding the bonus depreciation and
small business expensing provisions outlined above to cover investments
in commercial real property will help provide business owners with the
financial assistance they need to build that building or make long
overdue improvements.
I am very pleased to have the support of the U.S. Chamber of Commerce
and the National Restaurant Association for my proposals as part of a
robust economic stimulus package.
The Senate is working on a large economic recovery package and I am
optimistic that the package will include these important provisions. I
am told that the Senate Finance Committee plans to mark up the tax
portion of this package next week, and I am pleased that Chairman
Baucus has recognized the need to help our Main Street businesses. In
my judgment, including the tax incentives I have proposed will help
stimulate much-needed economic activity and get our economy growing and
creating jobs once again.
______
By Mr. WYDEN (for himself and Mr. Crapo):
S. 307. A bill to amend title XVIII of the Social Security Act to
provide flexibility in the manner in which beds are counted for
purposes of determining whether a hospital may be designated as a
critical access hospital under the Medicare program and to exempt from
the critical access hospital inpatient bed limitation the number of
beds provided for certain veterans; to the Committee on Finance.
Mr. WYDEN. Mr. President, I am pleased to be joined today by my
colleague Senator Mike Crapo, to introduce this important piece of
legislation for America's rural hospitals. I first introduced this
legislation in 2007 with Senator Smith, and I am proud to continue our
fight for rural hospitals in this Congress. Today, my fellow Oregonian,
Representative Greg Walden, is introducing this same bill in the House
of Representatives.
The Medicare program is turning rural communities into ``health care
sacrifice'' zones. Under current law, critical access hospitals either
have to risk their financial viability or their patient's health if a
26th patient walks in their door. Rural hospitals need greater
flexibility from the Medicare program to fulfill their obligations to
their communities--especially, but not limited to, their veterans--in
times of public health emergencies.
The Balanced Budget Act of 1997 merged a Montana initiative, the
medical assistance facility demonstration, and the Rural Primary Care
Hospital program into a new category of hospitals called critical
access hospitals CAH. By design, the Critical Access Hospital program
in Medicare ensures that rural communities have access to acute care
and emergency services 24 hours a day, 7 days a week.
In order to obtain this designation, hospitals must meet certain
requirements, such as being located more than 35 miles from any other
hospital, or receiving certification by the state to be a ``necessary
provider.'' Critical access hospitals must also provide 24-hour
emergency care services.
As a designated critical access hospital, Medicare pays these
hospitals based on its reported costs. Each critical access hospital
receives 101 percent of its costs for outpatient, inpatient,
laboratory, and therapy services. There are nearly 1,300 hospitals
across the United States in 47 states that operate under a critical
access hospital designation. Twenty-five of them are in Oregon.
One requirement of this program is that there be no more than 25 beds
occupied by patients at any one time. This requirement has proven to be
too constricting for facilities during times of unexpected need, such
as during an influenza outbreak or an influx of tourism to the
community.
Critical access hospital administrators in Oregon, especially Dennis
Burke from Good Shepherd Medical Center in Hermiston and Jim Mattes at
Grande Ronde Hospital in LaGrande, have expressed to me how this
restriction has lead to unnecessary risks to patient safety and health.
Hospital administrators have been forced to divert the 26th and 27th
patient in their hospitals to a hospital much farther from their homes
and families.
This legislation makes two important changes to the Medicare Critical
Access Hospital Program. First, this bill will provide the flexibility
necessary for a critical access hospital to either choose to meet
either the 25-bed-per-day limit or work with a limit of 20-beds-per-day
averaged throughout the year. During times of spikes in public health
need, these hospitals would be able to care for more patients even if
the hospital would exceed the use of 25 beds.
Second, this bill exempts beds used by veterans whose care is paid
for or coordinated by the Department of Veterans Affairs, VA, from
counting against the 25-bed limit or 20-bed yearly average. This change
gives CAHs the flexibility they need to treat America's military
veterans at a time when the VA has divested in hospital care for our
rural veterans, forcing them into these already tightly restricted
community hospitals.
This bill also ensures that these hospitals are meeting the
requirements under the law without breaking the bank. This new yearly
average of 20 beds is set lower than the daily limit, 25 beds, to
ensure that Medicare does not inappropriately expand this program. For
example, Grande Ronde Hospital would save Medicare an average of
$100,000 each year for ambulance transfers of Medicare/Medicaid
patients, all of whom could be treated within their facility had it
been able to be flexible on counting bed days.
I believe that these simple changes in the current law are critically
important to keeping our rural hospitals open and their communities'
health care needs served. As we look to expand access to health
coverage, this bill will ensure that the nearly 1,300 critical access
hospitals in the country have the flexibility they need to remain open
for the millions of Americans who depend on them.
I hope my colleagues will join me in supporting this bill, and I look
forward to working with Chairman Baucus and Ranking Member Grassley and
other members of the Finance Committee to secure passage of this
important bill.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 307
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 ``Critical Access Hospital
Flexibility Act of 2009''.
SEC. 2. FLEXIBILITY IN THE MANNER IN WHICH BEDS ARE COUNTED
FOR PURPOSES OF DETERMINING WHETHER A HOSPITAL
MAY BE DESIGNATED AS A CRITICAL ACCESS HOSPITAL
UNDER THE MEDICARE PROGRAM.
(a) In General.--Section 1820(c)(2)(B) of the Social
Security Act (42 U.S.C. 1395i-4(c)(2)(B)) is amended--
(1) in clause (iii), by inserting ``(or 20, as determined
on an annual, average basis)'' after ``25''; and
(2) by adding at the end the following flush sentence:
``In determining the number of beds for purposes of clause
(iii), only beds that are occupied shall be counted.''.
(b) Effective Date.--The amendments made by this section
take effect on January 1, 2010.
SEC. 3. CRITICAL ACCESS HOSPITAL INPATIENT BED LIMITATION
EXEMPTION FOR BEDS PROVIDED TO CERTAIN
VETERANS.
(a) In General.--Section 1820(c) of the Social Security Act
(42 U.S.C. 1395i-4(c)) is amended by adding at the end the
following new paragraph:
[[Page S792]]
``(3) Exemption from bed limitation.--For purposes of this
section, no acute care inpatient bed shall be counted against
any numerical limitation specified under this section for
such a bed (or for inpatient bed days with respect to such a
bed) if the bed is provided for an individual who is a
veteran and the Department of Veterans Affairs referred the
individual for care in the hospital or is coordinating such
care with other care being provided by such Department.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to cost reporting periods beginning on or after
the date of the enactment of this Act.
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