GOP in Congress, White House Reach Agreement on Medicare Spending Plan

Congressional Republicans and the White House have added $2.7 billion in spending for hospitals and hospice care, clearing the way for passage of legislation increasing government payments to Medicare providers.

The agreement calls for $32.7 billion in spending over five years. It is part of the spending bill for education and health programs, scheduled to be considered by lawmakers today.

Its expected passage would be one of the final bills of the session, clearing the way for Congress to adjourn and end a rare lame-duck session.

Negotiations over the legislation stalled in October when President Clinton complained that the initial Medicare package gave too much money to managed care companies. Clinton dropped his objections after the additional spending was added to the program, which provides health benefits for the elderly and disabled.

“We are pleased with the coverage expansions that were included and the provider payment enhancements that will ensure high quality care for Medicare beneficiaries,” said Chris Jennings, Clinton’s health policy advisor.

Jennings said he was disappointed that Democrats could not get additional provisions such as increased coverage for children with disabilities.

The compromise language includes $1.7 billion earmarked for urban teaching hospitals, rural hospitals, rural home health agencies and hospices.

Part of that money will also be used to waive the two-year waiting period before Medicare begins paying the expenses of patients with amyotrophic lateral sclerosis, also known as Lou Gehrig’s disease.

The other $1 billion would boost two components of Medicaid, the health program for the poor.

Half of the Medicaid funds would go toward working to expand the number of children in the State Children’s Health Insurance Program. The program is for children from low-income families who make too much money to qualify for Medicaid. The remainder would be used to expand Welfare to Work in 2002.

Currently, children are enrolled through welfare. The provision gives states the option to go to places such as schools, public housing and emergency shelters to enroll kids likely to be uninsured.

The remainder of funds will be used to continue Medicaid coverage for recipients of Welfare to Work. There is also a provision to develop new, simplified paperwork for seniors seeking assistance in paying their premiums and co-payments.

The Medicare package has been heavily lobbied by health care providers.

They have threatened to shut down unless they get more money, saying they are unable to operate on the current reimbursement levels from the government. Those payments were cut in 1997 when the federal government was awash in red ink.

About $10 billion in direct and indirect spending will go to managed care companies.

Another $5.7 billion would go toward improved benefits for patients, including decreasing in phases the outpatient co-payment from 60% to 40%, moving to biannual pap smear screenings, offering colon cancer screenings for all Medicare patients and allowing coverage of new digital mammograms.

The package also includes money for glaucoma screenings as well as medical nutrition therapy for patients with diabetes or renal disease.