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Roskam Introduces Bill to Repeal Obamacare's "Bay State Boondoggle"

Press Release

Location: Washington, DC

Today, Rep. Peter Roskam (R-IL) introduced H.R. 2053, The Medicare Hospital Wage Index Equity Act of 2013 which would repeal a portion of the health care law commonly referred to as the "Bay State Boondoggle,' that would result in Illinois hospitals losing more than $60 million in Medicare payments.

A provision in the health care law, sponsored by then-Massachusetts Senator John Kerry requires Medicare reimbursements to come from a national pool of money instead of a set amount for each state. Reimbursement rates for Massachusetts have skyrocketed because of one small Nantucket hospital with high reimbursement rates that set the minimum payment for the entire state. With Massachusetts expected to receive $256 million this year, Illinois hospitals have already lost more than $60 million.

"First there was the Cornhusker Kickback, the Louisiana Purchase, and Gator Aid--now Obamacare's Bay State Boondoggle should garner anger from almost every American," said Roskam. "That one state was able to game the system to the detriment of almost every other state is an indictment of the whole process that created the health care law. We must repeal this misguided policy as soon as possible and stop the bleeding of Medicare funds from hospitals around the country, including Illinois."

The Nantucket Cottage Hospital is designated as Massachusetts' only rural hospital. An arcane Medicare rule requires that a state's urban hospitals be reimbursed for wages paid to doctors and staff at least as much as rural hospitals, which typically have lower wages than urban hospitals. However, the Nantucket hospital--with its remote location on a posh vacation island with a high cost of living--has much higher wages, setting the floor for Massachusetts extremely high and resulting in the money drain from all other states.

If left uncorrected, hospitals in 40 states will experience reduced funding of more than $3.5 billion over the next ten years. H.R. 2053 would ensure that Medicare reimbursements are shifted back to a state-by-state allocation system; allowing hospital politics to remain local rather than allowing one hospital to drain the system. Earlier this year, the U.S. Senate passed a bipartisan amendment to repeal this earmark as part of its 2014 budget.

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