U.S. Senator Mark Pryor today signed on to the Hospital Payment Fairness Act of 2013, a bipartisan bill that would improve the healthcare reform law to ensure that Arkansas hospitals do not have to subsidize high Medicare wage costs in other states.
Pryor said current Medicare rules require a state's urban hospitals to be reimbursed for wages paid to doctors and staff at least as much as rural hospitals. Under the Affordable Care Act, Medicare reimbursements for hospital wages come from a national pool of money, instead of within each state's allocation. Unfortunately, Pryor said this means that an increase for one state results in a decrease for others.
"As with any major reform effort, we need to be vigilant about making sure reforms work to produce the intended result and fixing problems where they exist. I've heard from concerned Arkansas hospitals and healthcare providers about a problematic Medicare reimbursement provision in the healthcare reform law," Pryor said. "That's why I signed on to this bill that would eliminate the provision and ensure all states are treated fairly."
According to the Boston Globe, Massachusetts has only one rural hospital, Nantucket Cottage, which sets the floor for wage reimbursements for the rest of the state. Because of the hospital's remote location and high cost of living, wages at Nantucket Cottage are high--thereby allowing the state's 81 other hospitals to reap hundreds of millions of dollars in Medicare reimbursements at the expense of other states. Arkansas alone stands to lose $7.4 million this year.