October 22, 2015 | FAH Hospital Policy Blog Team
This week, Senator Dean Heller urged HHS Secretary Sylvia Mathews Burwell to revisit the proposed cuts to Medicare bad debt payments, or the Medicare “backstop”, in the FY2016 budget. The letter underscores the critical importance of this safety net for protecting Nevada’s seniors.
Senator Heller explains:
“My concerns relate directly to the impact this proposal could have on Nevada’s 38 community hospitals and the seniors who rely on their care. Cuts to Medicare “bad debt” payments from the current level of 65 percent to 25 percent, would disproportionately affect seniors that are dually eligible for Medicare and Medicaid. In my home state of Nevada, dual eligibility in 2013 accounted for nearly 60 percent of bad debt incurred.”
When Medicare was established over 50 years ago, the bad debt provision was created as a backstop – a safety net – to maintain coverage for seniors unable to meet their cost-sharing obligations. Many hospitals are left with a significant financial burden when seniors have difficulty affording their Medicare cost-sharing obligations. Medicare bad debt payments provide a tool for hospitals to address uncompensated care.
As Senator Heller highlights:
“We must get our nation’s health care spending under control with reasonable and sustainable solutions that protect America’s seniors and their access to quality health care. As Congress moves into debate on important end of year budget decisions, we ask that the Administration work with us to ensure that we continue to focus on reforms that address the challenges facing our increasing aging population with the recognition that many seniors and hospitals alike struggle in a weakened economy.”
The FAH thanks Senator Heller for standing up for seniors. It is time to maintain Medicare bad debt. These continued cuts break the promise made to seniors when the program was created and jeopardize access to care and coverage for all Medicare seniors.