Senators Collins, Snowe Request Strengthening Of Medicare And Medicaid Budgets

SENATORS COLLINS, SNOWE REQUEST STRENGTHENING OF MEDICARE AND MEDICAID BUDGETS

In a letter to the Chairman and Ranking Member of the Senate Budget Committee, Senators Olympia J. Snowe and Susan Collins are requesting increased funding to strengthen the Medicare program for seniors and the Medicaid program for low-income hospital care. The President's Fiscal Year 2008 budget currently contains Medicare and Medicaid funding adjustments that are not expected to keep pace with inflation or the rising costs of treatment and medication. The American Hospital Association estimates that the President's current proposal will result in Maine hospitals losing over $140 million in the next five years.

"The President's proposal is simply unacceptable. In a time when Medicare and Medicaid hospitals' operating revenues are at all-time lows, we must do more to ensure that those hospitals can maintain the level of service necessary to treat low-income patients." said Snowe and Collins in a joint statement.

Below is the text of a letter sent to Senator Kent Conrad, Chairman and Senator Judd Gregg, Ranking Member of the Senate Budget Committee:

Dear Chairman Conrad and Ranking Member Gregg:

We are writing to express our support for including provisions in the FY08 Budget Resolution to strengthen the Medicare program for seniors and protect access to hospital care for Medicaid beneficiaries.

Specifically, we urge the Committee to demonstrate its commitment to the Medicare and Medicaid programs and the seniors, disabled and children served by those programs, by opposing hospital cuts in the FY08 Budget Resolution. The nation's full service community hospitals, which serve as the health care safety net for so many vulnerable citizens, are under large and growing cost pressures. Rising numbers of uninsured, new and costly pharmaceuticals and technologies, labor shortages, and preparing for pandemics and terrorist threats are just some of the many pressures hospitals face and which our communities expect hospitals to address.

And yet, Federal payments are not keeping pace with the costs of responding to these challenges. Earlier this month, Congress' independent, nonpartisan Medicare Payment Advisory Commission (MedPAC) reported that Medicare payments are falling further and further below the minimal costs of care for our seniors. MedPAC estimates Medicare hospital operating margins of negative 3.1 percent in 2005 and projects that those margins will fall to negative 5.4 percent in 2007, the lowest Medicare margins recorded. This trend is simply unsustainable, and it is unacceptable. In response, MedPAC voted to recommend to Congress that hospitals receive a full inflation update in 2008. We hope you will agree with MedPAC and both include an inflation update for hospitals, and refrain from recommending any cuts in hospital spending in Medicare or in Medicaid, which has even lower operating margins.

We appreciate your consideration and look forward to working with you to achieve this goal.

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