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Pascrell Introduces Legislation to Protect America's Teaching Hospitals

Press Release

Location: Washington, DC


Outraged by the Department of Health and Human Services Secretary Michael Leavitt's attempt to justify Medicare cuts in the President's 2009 budget at a Ways and Means Committee hearing yesterday, U.S. Rep. Bill Pascrell announced the introduction of legislation that would bring equity to the unjust Medicare compensation formula currently used to reimburse teaching hospitals.

"I have introduced this measure in the interest of America's hospitals, medical students, and the Medicare patients who will one day depend on their doctors to have the highest level of training and expertise," stated Pascrell, "As it stands now, more than 600 American hospitals are being reimbursed by Medicare at an inadequate level for their work in training America's doctors of tomorrow. In New Jersey alone, our teaching hospitals lost about $6.9 million last year. I am concerned that these unsustainable losses are a threat to the future this nation's healthcare infrastructure."

Under current law, Medicare uses an antiquated formula to determine payments for hospitals with Direct Graduate Medical Education (DGME) programs designed to educate and train physicians. The formula, which was created in the 1980s no longer serves as an accurate reflection of the actual costs of operating training programs in the 21st century.

"Hospitals were designed to be properly reimbursed by Medicare for the operating costs of training new doctors," stated Pascrell. "My legislation will bring equity and fairness back to the hospitals which have committed to training the next generation of America's doctors."

Despite Congressional efforts in 1999 and 2001 to make incremental improvements in DGME payments, some hospitals still receive only 85 percent of the cost of the national average that teaching hospitals incur today for operating costs. Rep. Pascrell's legislation would increase the DGME payment to 100 percent of the national average per resident amount.

"Congress has already acknowledged the inequity facing our teaching hospitals by increasing DGME payments, but our work is not done. Too many hospitals, students, and patients are depending on us to equip teaching hospitals with the financing they need to turnout a stable of well trained, experienced physicians. My legislation would cover 100 percent of the national average that DGME programs incur for training new docs. We can't stand for anything less," concluded Pascrell.

Some northern New Jersey teaching hospitals that would benefit from Rep. Pascrell's legislation include; St. Joseph's Regional Medical Center, Hackensack University Medical Center, Bergen Regional Medical Center, PBI Regional Medical Center, and the University of Medicine and Dentistry of New Jersey.

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