fah hospital policy blog

Perspectives on health policy affecting America’s hospitals and the patients we serve.

South Florida Congressional Delegation Co-Signs Letter to Secretary Burwell on Medicare Backstop

March 05, 2015 | FAH Hospital Policy Blog Team

Category: Backstop, Medicare

For the second consecutive year, the entire bi-partisan Congressional delegation representing South Florida have co-signed a letter to HHS Secretary Burwell, calling for no further cuts to the Medicare Bad Debt Program.

This program—a fundamental pillar of Medicare since the program’s inception in 1965—protects American seniors who are unable to pay their cost-sharing obligations under Medicare.  The backstop is there to ensure American seniors do not have to worry about their ability to pay for the critical health care they need.  Seniors represent an especially vulnerable population, often requiring more and greater health care services than other sectors of the population.

The South Florida House delegation recognizes the needs of their constituents and that of senior citizens across the country, explaining in their letter:

“…hospitals do not have the ability to negotiate with Medicare to cover the costs of their patients who are unable to fulfill their cost-sharing obligation. Without these payments, hospitals will be put in an untenable position.”

Indeed, at its inception, Medicare was designed to cover 100% coverage of Medicare bad debt.  Over time, the program has suffered repeated cuts, currently covering just 65% of uncompensated care for seniors; hospitals must take on the burden of 35% of that care without any reimbursement.

The current HHS budget proposal from the Administration calls for a cut to the Medicare backstop to just 25%.  This would have devastating effects on patient access to care for all patients.

“…the path ahead necessitates sensible and sustainable solutions. To date, the Medicare Payment Advisory Commission has not recommended reduction to these payments, and no recent hearings have been conducted focusing on Medicare bad debt payment policy. Cutting these payments is not a solution to the long-term fiscal sustainability of the Medicare program.”

The FAH welcomes the broad, bipartisan support of the South Florida delegation, and thanks the Members who have co-signed this letter to protect seniors and the hospitals they depend on to provide care 24/7.