Rural hospitals between a rock and a hard place

Concerns mount as Congress looks to cut $1.2 trillion.

Kansas hospital officials are among those lobbying Congress in an effort to protect government health programs headed for the budget chopping block.

Last week, the Joint Select Committee on Deficit Reduction received the last of various proposals from the White House and other congressional committees. Now it begins the work of writing a plan for cutting at least $1.2 trillion in federal spending over the next decade.

Super Committee

The so-called Super Committee of six House and six Senate members has until Nov. 23 to vote out its bill, which must be presented to Congress and President Barack Obama by Dec. 2. If the measure fails on an up-or-down vote in the House or Senate, that would trigger automatic cuts to most government programs through a process called sequestration.

Most proposals on the committee’s table would cut Medicare, which provides health coverage for about 436,000 Kansans age 65 or older. Because of Kansas' disproportionately elderly population, especially in rural areas, the looming cuts are expected to have major consequences.

For example, a plan from the Obama White House would reduce federal Medicare spending on critical access hospitals by $6 billion over 10 years. Kansas has 83 of those type of rural facilities, more than any other state.

The White House also has proposed spending $20 billion less over 10 years by reducing federal makeup payments to hospitals saddled with bad debt. That would hurt most Kansas hospitals, rural and urban, because they no longer would get as much federal help dealing with the costs of patients who won’t or can’t pay their bills.

'Very concerned'

“We're very concerned about that,” said Fred Lucky, senior vice president with the Kansas Hospital Association. “That's a huge hit.”

Lucky said the White House plan would mean about $43 million less for Medicare per year for Kansas hospitals, enough to jeopardize operations at those with slim operating margins.

At some critical access hospitals, he said, Medicare patients make up 75 percent or 80 percent of the business.

“So they don’t have ability to absorb losses with other payers,” he said.

Lucky and some other Kansas hospital advocates were in Washington, D.C., last week, trying to persuade members of Congress to look for other ways to cut the deficit. They were there as part of a broader push by the American Hospital Association, the National Rural Health Association and other groups trying to keep funding intact as the president and Congress look for ways to meet the restrictions imposed by the debt-ceiling deal formalized in the Budget Control Act of 2011 on Aug. 2.

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