March 10, 2015 | FAH Hospital Policy Blog Team
In a letter to Secretary Sylvia Burwell, Representative Morgan Griffith (R-VA) urges HHS to preserve the Medicare bad debt program (also known as the backstop), which help seniors maintain access to vital hospital care by paying hospitals 65% of the cost of Medicare beneficiaries’ unpaid cost-sharing obligations. In his letter, Representative Griffith calls for no further cuts to this foundational pillar of the Medicare program. He also explains the very real impact that Medicare cuts have already had on his constituents.
“I represent a rural district in Southwest Virginia with a very high proportion of low-income residents and seniors citizens. Many of my hospitals are barely breaking even and are classified and Low Volume and Medicare Dependent.”
“In fact, I have had one hospital that closed its doors because of these issues. I do not want to see others follow suit, which would further the access problem that exists in my district.”
Representative Griffith’s district has experienced first-hand the consequences of Medicare cuts, which affects access to care for all patients and compels patients to travel further to receive critical care.
Bad debt reimbursement has been a fundamental part of the Medicare program since it began more than 50 years ago. Since then, the Medicare “backstop” has been cut from 100% reimbursement to just 65%. The President’s FY16 budget calls for a harsh cut—to just 25% reimbursement for Medicare backstop payments over three years. This would leave hospitals responsible for carrying 75% of the financial burden for those patients who cannot afford their cost-share.
The Medicare “backstop” is meant to protect these vulnerable seniors and the hospitals that serve them. However, hospitals’ already heavy financial burden only continues to grow with unsustainable cuts. There is no clearer an example of this than the situation occurring in Congressman Griffith’s district.
The FAH applauds Representative Griffith’s effort to protect America’s seniors and protect patient access to care. Cutting the Medicare backstop threatens access to care for all of our patients. We continue to urge policymakers to protect Medicare beneficiaries, the hospitals that serve them, and their communities by rejecting any further Medicare bad debt cuts.