US Hospital Lobbies Resist House Bill Site Neutral Clause


The US House of Representatives has gone on to introduce a bill that would equalize payments in terms of medications given across outpatient clinics, irrespective of their ownership, which has got hospitals worried.

The American Hospital Association and the Federation of American Hospitals recently have filed letters to Congress pleading with lawmakers to oppose the bill’s site-neutral clause, which, according to them, would jeopardize patient access by decreasing hospitals’ Medicare reimbursements.

Interestingly, the House is all set to vote on the bipartisan Lower Costs, More Transparency Act during the week of December 11.

It is well to be noted that for the same care, hospital outpatient departments are paid more in the Medicare gamut than independent medical practices as well as ambulatory surgery clinics. Additionally, so as to offset what they claim are increased overhead costs, hospital-owned clinics may levy additional facility fees, which would in turn raise customers’ co-pays.

Legislators on the Hill have gone on to recently step-up their efforts in order to pass site-neutral regulations, which would make sure that the government pays the same amount for the same medical treatment irrespective of where it happens to be provided.

Healthcare stakeholders, which include physicians, generally go on to support site neutrality, but hospitals, who would lose Medicare income because of it, degrade it.

Apparently, the hospitals claim that policies that happen to be site-neutral fail to consider the difference when it comes to hospital outpatient departments and other healthcare facilities. As per the hospitals, outpatient locations go on to treat sicker patients and have higher overhead expenses, like investments in emergency care that happen to be available around the clock and also in backup capacity for disasters.

Due to this, the AHA as well as the FAH strongly objected to the new bill’s site-neutral throttle for outpatient medication payment.

The AHA went on to state in their letter that the site-neutral payment cuts that exist have already had a major side effect on the financial sustainability of hospitals as well as health systems. This proposal would raise these deficits, making several hospitals’ financial difficulties even worse.

Critics go on to claim that due to the current uneven payment structure, patients’ costs as well as those of the Medicare program happen to be increasing. Additionally, it produces adverse incentives for consolidation when hospitals buy doctor practices, rename them, and even charge more for the same services.

The Alliance for Site Neutral Payment Reform- ASNPR which happens to be an advocate of equalized Medicare reimbursement, opines that individuals are required to pay two to three times the amount for medications that’s offered by hospital outpatient settings vis-à-vis independent physician offices because of existing payment differentials.

The Congressional Budget Office goes on to estimate that the site-neutral requirement of the bill will decrease the out-of-pocket expenses for people who have autoimmune disorders and cancer by more than $3.7 billion over a ten-year period.

It is worth noting that the legislators were urged to go further and also offer site-neutral payments to all services at off-campus hospital outpatient departments in a letter from ASNPR.