Hospital Medicare Funds Get Bipartisan Push

John Commins, for HealthLeaders Media , December 12, 2012

"Rural hospitals deliver healthcare to more than 60 million Americans and are the health and economic backbone for communities across our nation," said the letter.

"These small, hardworking hospitals are often the sole source of comprehensive healthcare in their area, and are typically the largest employer, and economic engine, in the communities they serve. Yet, rural hospitals face a wide array of financial difficulties and operational challenges under the current Medicare Prospective Payment System."

MDH status, enacted by Congress in 1987, requires that hospitals be in a rural area, have no more than 100 beds, and show that Medicare patients represent at least 60% of their inpatient days or discharges.

A study done for NRHA found that in 2009 MDHs operated at a negative 4% margin on average. Without hospital-specific and transitional outpatient payments, the study estimated that those MDH margins would have fallen to negative 12.6%.

A Senate Finance Committee aide, speaking on background, told HealthLeaders Media that "Chairman Baucus is working with members of Congress on the full extenders package that includes the provisions in this letter. They're hopeful Congress will be able to reach an agreement on the package before the end of the year."

Such assurances may be of little use for the administrators at rural hospitals across the country who, unlike Congress, have to provide for a balanced budget. Unfortunately, in this gridlocked environment that may be about as much as we can expect.

So, let's look at some of the reasons for hope that the funding will be restored.

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