5. GOP still seeking afterglow of vote on drug benefits
   Three months after the GOP-controlled Congress expanded Medicare to include prescription drug benefits that Americans have long wanted, the political bounce that Republicans had hoped for is eluding them, as critics rail against the new law and voters say they still trust Democrats more on the issue. To read the full story in the Washington Post,  click here.

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6. McClellan's Nomination To Top CMS Post Faces Opposition Because Of His Stance On Drug Imports
   Sen. Byron Dorgan (D-ND) said February 25 that he plans to hold up FDA Commissioner Mark McClellan's nomination to head the Centers for Medicare and Medicaid Services because of his recent actions opposing drug importation from Canada. According to a February 25 report in the New York Times, Sens. Debbie Stabenow (D-MI) and John McCain (R-AZ) also have expressed reservations about McClellan's nomination because of his position on drug importation. To read Sen. Dorgan's press releases,  click here and  here.

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7. CMS seeks comment on hospital quality data collection
   The Centers for Medicare & Medicaid Services (CMS) is inviting public comment on the information collection requirements for its Hospital Reporting Initiative, which will require hospitals to submit data on 10 quality measures to receive a full Medicare payment update in fiscal year 2005. CMS estimates it will take participants roughly 52 hours to report on all 10 measures, which are currently part of the voluntary hospital-led Quality Initiative and will be required for a full market basket update in FY 2005-07 under the Medicare Prescription Drug, Improvement and Modernization Act. CMS will accept comments on the proposed data collection until March 18. For more, see the Federal Register notice  here under "Centers for Medicare & Medicaid Services.

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8. Medicaid Cost Dispute Likely Between Federal and State Officials
   The Bush Administration and states appear headed for a confrontation as officials from the Centers for Medicare and Medicaid Services begin to clamp down on state efforts to shift more of the cost of Medicaid to the federal government. In his proposed 2005 fiscal year budget, President Bush said the federal government could save $1.5 billion next year and $23.6 billion in the next decade with efforts to restore the "fiscal integrity" of Medicaid. The Bush administration published a notice in the Federal Register in February to inform states that the federal government plans to require them to provide detailed descriptions of each source of revenue used to pay their shares of the cost of Medicaid. 
   Under the plan, the federal government would have to approve state Medicaid budgets and states could not receive federal funds for additional costs unless federal officials approve the expenditures. However, state officials have balked at the plan and maintain that efforts by the federal government to limit practices such as intergovernmental transfers of funds would lead to "a real hardship" for state Medicaid programs.
   Federal officials maintain that state efforts to shift more of the cost of Medicaid to the federal government, which currently covers between 50 percent and 70 percent of the cost of the program, have raised federal Medicaid expenditures. According to the General Accounting Office, which has added Medicaid to a list of high-risk programs, states have used various financing strategies to generate excessive federal Medicaid matching funds while their own share of expenditures has remained unchanged or decreased.

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9. Frist Names Five to Pension Bill Conference
   Sen. Majority Leader Bill Frist (R-Tenn.) has appointed five senators to a conference committee charged with reconciling House and Senate versions of a bill that would extend pension relief for hospitals and other employers for two years while Congress studies a long-term solution. While different, both bills would temporarily replace the 30-year Treasury rate used to calculate pension fund contributions with a composite corporate bond rate. The new rate would reduce required contributions, which have soared in recent years due to a steep drop in the Treasury rate.
   The Senate conferees are Finance Committee Chairman Charles Grassley (R-Iowa) and ranking member Max Baucus (D-Mont.); Health, Education, Labor and Pensions Committee Chairman Judd Gregg (R-N.H.) and ranking member Edward Kennedy (D-Mass.) and Senate Majority Whip Mitch McConnell (R-Ky.). House Speaker Dennis Hastert (R-Ill.) could name additional conferees.
   Hospitals are pushing for final passage of pension relief legislation before April, when many hospitals will be required to contribute to their employees' pension funds. Temporary relief enacted by Congress last March expired Dec. 31.

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10. AHA recommends changes to proposed psych PPS rule
   The AHA on Feb. 26 urged the Centers for Medicare & Medicaid Services to modify its proposed prospective payment system rule for inpatient psychiatric facilities to lessen the financial impact on the facilities, particularly distinct part units, and protect patients' access to mental health care. "We are gravely concerned that the proposed rule will further weaken our fragile mental health system...and prevent many individuals from getting the treatment they urgently need," AHA Executive Vice President Rick Pollack said in a comment letter to the agency. While the AHA supports a shift from a cost-based system to a PPS, it recommended several changes, including increasing estimates of the agency's spending under current law, providing an adjustment for facilities with an emergency department, and adding to the list of co-morbid conditions. The AHA said that, though the recommended changes would minimize the impact of the new PPS on distinct part units, CMS also should implement a "stop loss" policy to protect providers that suffer significant payment cuts. CMS' proposed rule, which would affect nearly 2,000 freestanding psychiatric facilities and distinct part units, was published last Nov. 28; a final rule is expected later this year. The comment letter will soon be available at www.aha.org under "What's New."

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11. Docs’ group forms to press Congress on liability reform
   A new physicians’ organization announced its formation last week solely to push a medical liability reform bill through Congress and began a print and television advertising campaign on the topic. Doctors for Medical Liability Reform, Washington, arose from the failure of the Senate last year to pass a bill—already cleared by the House—that would establish a $250,000 limit on noneconomic damages in medical malpractice cases. The group said it is separate from the American Medical Association and has 23,000 doctors as members. The prints ads were to run in the Wall Street Journal, USA Today and the Washington Post. 

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12. Medicare reform remains a pivotal campaign issue
   With Senators Kerry and Edwards leading the Democratic field for the presidential nomination, Medicare reform remains a defining campaign issue that highlights what some see as key differences between the two major parties, if not between the leading Democratic candidates. For the full story,  click here.

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