Congresswoman Annie Kuster (NH-02) this week led a bipartisan group of lawmakers in urging the House Ways and Means Committee to protect funding for Critical Access Hospitals (CAHs), which play a critical role in providing access to care for Medicare beneficiaries, medically underserved populations, and other residents in rural communities in New Hampshire and across the country.
In his FY 2014 budget, President Obama proposed reducing the Medicare reimbursement level for CAHs by $1.43 billion over 10 years, and eliminating the designation affording cost-based payment for facilities within 10 miles of another hospital. These drastic cuts would significantly impact the ability of CAHs to provide essential care for patients with complex medical needs, and could lead to some CAHs shutting down altogether. Without CAHs, many patients would be forced to travel long distances to receive life-saving care and would not be able to remain at home in their rural communities.
In a letter to the Chairman and Ranking Member of the House Ways and Means Committee, Kuster and a bipartisan group of 24 of her colleagues highlighted the vital role CAHs play in providing high-quality medical care to rural communities, and urged the Committee to protect these hospitals from deep cuts.
"Critical Access Hospitals (CAH) have provided significant savings in our current healthcare system by performing better on price, avoiding high costs of transporting patients to other facilities, and meeting the needs of local residents," the letter read. "As key safety nets for many Americans, these hospitals provide a range of exceptional care including both inpatient and outpatient services, as well as 24-hour emergency care, and make it affordable for patients with complex medical needs to remain at home in rural communities."
"We tremendously appreciate Congresswoman Kuster's leadership and recognition of how devastating it would be to the communities we serve should Congress act to solely continue Critical Access Hospital status based only on geographical distance," added Tom Clairmont, President and CEO of Franklin Regional Hospital and LRGHealthcare. "This status clearly is the difference that allows half of New Hampshire's hospitals, like Franklin Regional Hospital, to meet the needs of Medicare Beneficiaries and the Medically Underserved Population we serve to maintain essential access to quality care."
New Hampshire has thirteen CAHs that provide care to rural communities across the state:
Alice Peck Day Memorial Hospital, Lebanon
Androscoggin Valley Hospital, Berlin
Cottage Hospital, Woodsville
Franklin Regional Hospital, Franklin
Huggins Hospital, Wolfeboro
Littleton Regional Hospital, Littleton
Monadnock Community Hospital, Peterborough
New London Hospital, New London
Spear Memorial Hospital, Plymouth
The Memorial Hospital, North Conway
Upper Connecticut Valley Hospital, Colebrook
Valley Regional Hospital, Claremont
Weeks Medical Center, Lancaster
The full text of the bipartisan letter is below and attached.
June 17, 2013
The Honorable Dave Camp
House Ways and Means Committee
1102 Longworth House Office Building
Washington, DC, 20515
The Honorable Sander Levin
House Ways and Means Committee
1139E Longworth House Office Building
Washington, DC, 20515
Dear Chairman Camp and Ranking Member Levin:
We are writing to you regarding the President's budget for Fiscal Year 2014. Similar to Fiscal Year 2013, the President's budget targets critical access hospitals (CAHs). Specifically, the budget seeks to reduce the Medicare reimbursement level for CAHs by $1.43 billion over 10 years. It would also eliminate the designation affording cost-based payment for facilities within 10 miles of another hospital, in order to cut another $690 million from Medicare. We are very concerned about this proposal as these cuts would be detrimental to CAHs in our congressional districts--impeding their ability to provide high quality care to our constituents.
Critical Access Hospitals (CAH) have provided significant savings in our current healthcare system by performing better on price, avoiding high costs of transporting patients to other facilities, and meeting the needs of local residents. In 2010, the average cost per rural hospital beneficiary was 3.7% lower than per urban beneficiary, saving our healthcare system $2.2 billion, according to a study by iVantage Health. CAHs play an essential role in delivering high quality care and essential access throughout rural America. Without CAHs, hundreds of thousands of Americans may lose or have limited access to essential care.
As key safety nets for many Americans, these hospitals provide a range of exceptional care including both inpatient and outpatient services, as well as 24-hour emergency care, and make it affordable for patients with complex medical needs to remain at home in rural communities.
The most troubling part of this budget proposal is the elimination of CAH status for those CAHs within 10 miles of another hospital. The lack of rationale for this policy change is especially troublesome. The distance between hospitals should not be the determining factor for CAH designation. There have been no government or private studies cited in the Administration's proposal supporting this significant policy change. The selection of 10 miles - as opposed to 5, 15, or 20 -- seems capricious. Hospitals are classified as critical access based on the recommendation of their own states, with concurrence from the Center for Medicare and Medicaid Services. There are 43 of these "10-Mile CAHs" in 22 states-- all of which would be devastated by this change.
We understand that a number of representatives from these CAHs recently met with CMS senior staff in Baltimore to discuss this issue. During that meeting, they were told that CMS did not make the policy change recommendation, thought it would be difficult to implement, and that the potential savings were marginal relative to the devastating impact the changes would have on the communities the CAHs serve.
Medicare spent an estimated $550 billion last year. The estimated savings of $690 million over 10 years is just about one-hundredth of one-percent of 10 year Medicare spending, and we think these savings are overstated because patients will likely be redirected to expensive tertiary hospitals whose disproportionate share hospital (DSH) and indirect medical education (IME) adjustments likely offset any savings from the loss of CAH status. The investment we are making in these CAHs is money well spent, as it keeps patients in their communities, saves family members from time off work transporting loved ones to distant facilities, and encourages primary care physicians and specialists to stay and serve our rural communities.
As your committee continues its work on important health care issues, we believe cuts to CAHs are not the answer. This is particularly true concerning the elimination of the CAH designation to hospitals based on an arbitrary number of miles between facilities.
Thank you for your consideration of this request. Please do not hesitate to contact us if you have any questions or would like additional information.