ACA Fixes Deserve Parity

There is increasing chatter about Congress potentially intervening to repeal the ACA’s medical device tax.  Whether or not Congress should eliminate this tax, and the $20 billion in financing it provides to expand coverage, is an important public policy question.   Equally important, however, is recognizing that any deal altering the ACA must account for the law’s carefully constructed balance of contributions and costs in order to achieve coverage.

There are important items to be considered, including:

  • * CBO’s coverage estimates, which have steadily ticked down since 2010. Following the Supreme Court’s ruling nullifying the core of ACA’s Medicaid expansion, CBO’s latest coverage estimates 7 million fewer people will attain coverage.  This is in comparison to the coverage estimate hospitals relied on when agreeing to a then-$155 billion in payment cuts to help offset the cost of expanding coverage.
  • * Looking forward, CBO now estimates that the ACA will result in cuts to Medicare and Medicaid hospital payments totaling well over $300 billion over the next ten years. In addition, laws enacted by Congress, and regulations issued since the ACA, have cut hospital payments by an additional $95 billion.
  • * Uncompensated care—which totaled $41 billion in 2011—and the excessive payment cuts now approaching nearly half a trillion dollars over the next 10 years unquestionably impact the role that hospitals can play in their communities, both as employers and as providers of high quality, essential care to those most vulnerable.
  • * Congress’s own advisory body on Medicare payment policy (MedPAC) documents the eleventh consecutive year that Medicare hospital payments will fall below the cost of care – an estimated six percent below cost in 2013.  Medicaid payments are likely even lower.

Hospitals are not distant factories, they are the front lines of health care delivery.   Patients and their families rely on their neighborhood hospital to deliver the latest advances that produce the best outcomes for patients and save lives.  When faced with continued reimbursement cuts that fly in the face of what’s best for patients, we don’t have the option to leave the country and look for a more favorable operational environment, nor would we want to.  Our commitment is to our mission to serve the social and health care needs of communities across America, 24 hours a day, every day.

But to do this, hospitals cannot sustain further cuts and must achieve reasonable mitigation.   It is critical that should Congress reopen the ACA to reconsider the contributions of any one health care sector that benefits from ACA’s coverage expansion, it should simultaneously address the changed circumstances of hospitals and provide similar relief.  Communities are counting on it.

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