[Congressional Record (Bound Edition), Volume 145 (1999), Part 7]
[Extensions of Remarks]
[Page 9433]
[From the U.S. Government Publishing Office, www.gpo.gov]



   INTRODUCING LEGISLATION TO STOP FINANCIAL HEMORRHAGE OF NATION'S 
                       PREMIER TEACHING HOSPITALS

                                 ______
                                 

                         HON. CHARLES B. RANGEL

                              of new york

                    in the house of representatives

                        Wednesday, May 12, 1999

  Mr. RANGEL. Mr. Speaker, I am today introducing legislation to stop 
the cuts in Medicare's indirect medical education (IME) program. 
Identical legislation is being introduced in the Senate today by 
Senator Moynihan of the Senate Finance Committee.
  IME payments are extra payments made to teaching hospitals for the 
fact that they are training the next generation of doctors, and that 
the cost of training a young doctor--like any apprenticeship or new 
person on the job--is more expensive than just dealing with 
experienced, older workers. The young person requires mentoring, orders 
more tests, and makes mistakes unless closely supervised. It is natural 
that a group of young residents in a hospital will reduce a hospital's 
efficiency and increase its costs. Medicare should help pay for these 
extra ``indirect'' costs, if we want--as we surely do--future 
generations of competent, highly skilled doctors.
  The Balanced Budget Act took the position that the extra adjustment 
we pay a hospital per resident should be reduced from 7.7 percent in FY 
1997 to 5.5 percent in FY 2001. This provision was estimated to save 
about $6 billion over 5 years and $16 billion over ten--in addition to 
about another $50 billion in hospital cuts in other portions of the 
BBA.
  Mr. Speaker, these cuts are too much. The nation's teaching 
hospitals, which do so much to serve the uninsured and poor, and which 
are the cradle of new clinical research and technical innovation, are 
hemorrhaging red ink.
  Our bill stops further scheduled cuts in the IME, freezing the 
adjustment factor at 6.5 percent rather then letting it fall to 5.5 
percent, and saving teaching hospitals about $8 billion over ten years 
that would otherwise be taken from them.
  I hope this legislation will receive early consideration. The 
situation is, as a hospital ER would say, STAT.
  Mr. Speaker, I would also note that we should pass other legislation 
to help our Nation's hospitals: HR 1103 is a bill I introduced to 
`carve out' disproportionate share hospital payments from the amount we 
pay HMOs and give that money directly to the DSH hospitals when an HMO 
uses those hospitals. Today, Medicare HMOs are paid as if they use DSH 
hospitals, but they frequently avoid the hospitals that serve the 
uninsured because they are more expensive hospitals--thus pocketing the 
DSH payment and leaving the DSH hospital with empty beds.
  We must also correct a technical error in the BBA which capped the 
amount we pay psychiatric and rehabilitation hospitals (so-called TEFRA 
hospitals) but failed to adjust the cap for higher wage costs in urban 
areas. The result is severe hardship for such hospitals in urban areas. 
At the first opportunity, I will try to amend the BBA to correct this 
drafting error.

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