SCHIP Funding
In 2007, Congress is working on a health package that will reauthorize SCHIP and stop a scheduled 10 percent cut in physician payments from taking place. NRHA will be working to make sure this package includes important provisions for rural providers and beneficiaries.
Updates
July 3, 2007 - Expected Timeline
Congress returns from recess on Monday, July 9th. The NRHA anticipates at this time, Congress will be taking up SCHIP, the SGR fix and the larger health package after recess. The Senate Finance Committee had hoped to hold a subcommittee markup, where a draft of the bill would be released before recess. That did not happen. It appears now that the House will go first with the House Energy and Commerce Committee and Committee on Ways and Means attempting to move legislation before the end of July.
SCHIP
The NRHA strongly supports reauthorization and expansion of the State Children's Health Insurance Program (SCHIP). The program was established in 1997 as a way to provide insurance to children that did not qualify for Medicaid. The NRHA has strongly supported the program since that time. If Congress does not reauthorize the program before October 1st, the program will disappear.
Rural children disproportionately rely on SCHIP and Medicaid. A Spring 2007 Carsey Institute Study found that 32% of rural children are enrolled in SCHIP or Medicaid compared to 26% of urban children. In addition, over 1.3 million rural children are still uninsured. We must do better.
The NRHA is advocating to Congress:
- Reauthorize the program
- Provide enough additional dollars to insure all eligible children
- Create a rural grant program to increase outreach and enrollment in rural parts of the country
Additional resources:
- NRHA one pager on SCHIP
- Group sign on letter to Congress supporting SCHIP
SGR Fix - Physician Payment Update
The NRHA supports halting a scheduled 10 percent cut in payments to physicians. Such a payment cut based on the Sustainable Growth Rate (SGR) on top of expiring provisions from the Medicare Modernization Act (MMA) that benefit rural providers could be a disastrous double whammy. We look forward to working with Congress on a way to protect rural physicians who are already scarce in many rural communities.
MMA Extenders
The Medicare Modernization Act (MMA) provides a number of important provisions for rural providers that have helped protect the fragile rural health safety net. These provisions include:
- Work GPCI 1.0 Floor for Rural Physician Payments
- Two Percent Bonus Payment for Ambulance Trips in Rural Areas
- Five Percent Add-On Payment for Home Health Services
- Outpatient Hold Harmless
- Payment of Reasonable Lab Costs for Certain Small Rural Hospitals as Part of Outpatient Services
- Treatment of Certain Technical Component Physician Pathology Services Under Medicare
- Incentive Payment for Physicians in Physician Scarcity Areas
These provisions are slated to expire within the next few years. The NRHA is strongly encouraging Congress to include extensions of these provisions in any health package that is considered this year.
Additional resources:
- NRHA one pager on MMA Extenders
- NRHA two pager on MMA Extenders
Other Important Rural Provisions
As Congress works on this health package, it is very important that they consider other provisions that would help provide higher levels of care for our rural communities. The NRHA is asking Congress look at S. 1605, The Craig Thomas Rural Hospital and Provider Equity Act and H.R. 2860, Health Care Access and Rural Equity (H-CARE) Act of 2007.
While including many provisions that are important to the rural health care delivery system, two that we would like to highlight at this time are:
- Proportional Representation on MedPAC - the Medicare Payment Advisory Commission (MedPAC) is responsible for advising Congress on the Medicare system. Despite its disproportionate effect on rural providers and the law mandating an urban-rural balance, only one commissioner is currently from a rural area. You can read more on our MedPAC page.
- Expansion of the 340B Program - the 340B discount drug program is intended to benefit all safety net providers and assist them in purchasing reduced cost drugs. Currently, the program is designed mainly for urban providers. We believe the program should be expanded to rural providers that are designed to be rural safety net providers.
Medicare Advantage
The two most likely offsets for this health package are a tobacco tax increase and cutting Medicare Advantage payments. The NRHA has never taken a position on tobacco use. The NRHA does, however, believe that Medicare Advantage (MA) in the current setup is not working as well as it could with regulatory and legislative adjustment.
We do support the rationale for MA overpayments, as previously enacted through higher rural floors. Rural beneficiaries have always received fewer benefits than their urban counterparts whenever Congress has attempted to involve the insurance industry in Medicare programs. In both Medicare+Choice and Medigap models, rural elders are under-enrolled and receive fewer benefits. The NRHA felt that such overpayments, to encourage plans to provide rural plans, would be a beneficial use of tax payer money.
It appears that this is not working. A RUPRI policy brief from April revealed that despite significant growth in MA plans, only 5.6 percent of rural beneficiaries were in these plans. Forty-four percent of those beneficiaries were in private fee-for-service (PFFS) plans, which have raised significant concerns in the rural provider community, compared with only eight percent of urban beneficiaries. Subsequent unpublished data indicates similar discrepancies on whether rural seniors are receiving the extra benefits.
In addition, the NRHA is concerned that plans, especially PFFS plans, are not paying attention to the sensitive nature of the rural health safety net. Rural providers are not being paid their fair rate in a timely manner. In addition, plans are shifting additional administrative burdens on to providers by delaying payments and refusing to be honest with enrolled seniors. We believe the program has serious concerns that need to be addressed. A few of these include:
- Plans provide fair reimbursements to rural providers in amounts no less than they would be paid by traditional Medicare;
- CMS engages with rural health experts regarding how to determine and enforce rural community access standards;
- Provide the Federal Office of Rural Health Policy with expanded authority to provide technical assistance and outreach on ways rural providers can collaborate in the review of MA contracts;
- State Insurance commissioners should be empowered to provide oversight of plans; and
- Companies should be restricted in the number of plans they offer to beneficiaries by CMS because a large array of choices has the effect of confusing beneficiaries, making it difficult for them to make rational choices.
If Congress chooses to reduce Medicare Advantage funding, the money should be reinvested in rural America. Health care access is the priority for rural seniors. Protecting the fragile rural health care safety net needs to be the priority of Congress.
Additional resources:
- NRHA one pager on Medicare Advantage
- NRHA policy paper on Medicare Advantage from February
- Data on MA beneficiaries by state. This information is provided by the RUPRI Center, to be published in a forthcoming Policy Brief, with use permitted only with their permission:
- Rural MA beneficiaries as percentage of Medicare population by state
- Urban MA beneficiaries as percentage of Medicare population by state
- Total MA beneficiaries as percentage of Medicare population by state
- Number of Rural MA beneficiaries by state
- Total Number of MA beneficiaries by state
If you have additional questions or comments, please contact the NRHA Government Affairs Office at 703-519-7910.
