Hospital Reimbursement Sours Otherwise Fair Deal For Taxpayers

Washington, DC -- Congressman Eliot Engel (D-NY-17) voted for the House-Senate compromise to extend the payroll tax cut, unemployment insurance and what is known as the “Doc Fix” which will prevent substantial cuts in Medicare payments to doctors.  However, he said the deal was soured by the significant cuts to Disproportionate Share Hospital (DSH) funding.  This cut will cost New York hospitals millions of dollars, and cost the nation’s hospitals $4.1 billion over 11 years. 

“Overall, this deal is an important one for the American people.  It puts more money in the pockets of 160 million Americans, it ensures tens of millions of seniors will not lose access to their doctors of choice, and it helps the millions of Americans still struggling to find work.  The compromise also eliminates the vast majority of damaging cuts made by the House Republican Majority, including the one which would have raised the costs for Medicare beneficiaries and forced 170,000 people to lose their coverage.  It is a rare good thing to have this compromise take place, as there is an unwillingness by the Tea Party-led House Majority to compromise on anything since it took over the House last year,” said Rep. Engel.

“However, one offset that remains damages our New York hospitals.  These cuts to DSH, which helps pay for uncompensated care and makes up the cost of underpayments in Medicaid, will punish New York hospitals for providing superior health care.  New York sets the bar when it comes to health care - training one in six doctors and is home to some of the world's leading research and treatment health facilities.  Even after the full implementation of the Affordable Care Act, there will still be millions of uninsured people in America, and hospitals need the DSH funding to help them absorb the costs for treating them.  I fear that the safety net hospitals in our state provide will be damaged by the loss of these funds – as these hospitals are already in dire financial need due to cuts in local government funding.  They are often the main source of care for the low-income and uninsured of our state and nation and their ability to continue to do so is not a luxury, it is a necessity,” added Rep. Engel, a senior member of the House Energy and Commerce Committee’s Subcommittee on Health.

Among the positive provisions in the compromise, passed by both the House and Senate on Friday, are the following:

•    Extends the payroll tax cut for the remainder of 2012, providing a typical middle-class family take-home pay increase of $1,000 over an entire year.  
•    Revenue not going to the Social Security Trust Funds due to the payroll tax reduction is fully replaced with savings from Treasury’s General Fund.
•    Continues federal Unemployment Insurance programs through the end of 2012, gradually reducing the number of weeks, and with some adjustments in requirements.  
•    Retains the current maximum level (99 weeks) of total Unemployment Insurance benefits through May, reduces the maximum to 79 over the summer, and to 73 in September – depending on a state’s unemployment rate.
•    Includes provisions to extend the nation’s primary welfare program, Temporary Assistance for Needy Families, through Fiscal Year 2012
•    Authorizes the Federal Communications Commission (FCC) to pay TV broadcasters for underutilized broadcast spectrum and resell it at higher prices to wireless companies to meet the growing spectrum demands of smartphones and tablets.  
•    The bill also provides $7 billion to build a nationwide broadband network for police, firefighters, emergency medical service professionals, and other first responders --  fulfilling the final recommendation of the 9/11 Commission.
•    Ensures Medicare beneficiaries continue to have access to their physicians by blocking a 27.4 percent cut in Medicare physician payment rates, scheduled for March 1, 2012, and instead extends current payment rates through December 31, 2012.  
 

“I am pleased that many of the GOP’s attempts to slash these programs failed, including their desire to cut UI benefits nearly in half.  I am very pleased to see the commitment to our first responders, through the investment in a nationwide broadband network.  I think we have missed another golden opportunity to reach an agreement on a permanent Doc Fix. The longer we wait to do this, the more difficult it becomes to continually pass temporary patches to the system,” said Rep. Engel.  “Also, yet again, while asking no sacrifices from Big Oil or the wealthiest income earners – we are asking the federal work force to bear the brunt of paying for an extension of unemployment insurance benefits.  How can we expect to recruit and retain a qualified, effective federal work force if we continue to decimate their pay and pensions, and attack them for serving their country?”

The 12-term Congressman added, “No compromise is ever perfect, and this one is mostly positive, but I am very disappointed that New York will again be asked to shoulder the load for the nation.  I will continue fighting to restore DSH funding for New York hospitals before these massive cuts start to take effect, and the stellar quality of care in New York becomes adversely affected,” said Rep. Engel. 

To view Rep. Engel’s floor speech - http://www.youtube.com/watch?v=Wkrv4AeRRKQ&feature=youtu.be

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