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Letter to PA Congressional Delegation on Medicare Rural Hospital Payments

March 16, 2015

Dear Members of the Pennsylvania Delegation:

On behalf of The Hospital & Healthsystem Association of Pennsylvania (HAP) and the below listed organizations, I am writing to stress the importance of Medicare policies targeted to support access to care in rural communities.

Pennsylvania is home to the third largest rural population in the country, with approximately 27 percent of the state’s population living in rural areas. We appreciate the opportunity to highlight critical rural hospital priorities as Congress addresses the sustainable growth rate (SGR).

The Medicare-Dependent Small Rural Hospital (MDH) program and Low-Volume Hospital Adjustment (LV) are set to expire on March 31, 2015.

The MDH program is designed to support small rural hospitals that serve a large Medicare population and consequently rely heavily on Medicare payments to sustain hospital operations. The LV hospital adjustment provides a payment adjustment to small rural hospitals that are unable to achieve economies of scale due to a limited number of discharges.

The combined impact of these programs for Pennsylvania is nearly $30 million dollars annually. Both programs are key factors in the viability of the hospitals they support.

We urge you to cosponsor H.R. 663 / S. 332, which would provide crucial stability for these community providers. We also ask that the MDH program and LV adjustment be extended for the full duration of whatever SGR legislation moves forward.

In addition to the threat of payment cuts, Critical Access Hospitals (CAH) face regulatory policies that restrict the delivery of essential services.

  • Medicare requires physicians to certify that patients admitted to a CAH will be discharged or transferred to another hospital within 96 hours for the CAH to receive payment for the patient’s services under Medicare Part A. While CAHs typically maintain an annual average of 96-hours per patient, they offer some medical services that have standard lengths of stay longer than 96-hours.
    Enforcement of this 96-hour rule as a “condition of payment” threatens patients’ access to longer care when needed. We urge you to cosponsor H.R. 169 / S. 258, the Critical Access Hospital Relief Act, which would remove the 96-hour physician certification requirement as a condition of payment.
  • CAHs and small rural hospitals offer essential access to outpatient therapy services. However, policies surrounding the level of supervision of those services impacts the availability of care. Prudent policy should provide a default standard of “general supervision” for outpatient therapy services and establish an exceptions process for procedures that warrant direct supervision.
    “General supervision” would allow the services to be performed under the overall direction and control of a physician or non-physician practitioner; “direct supervision” requires a supervising physician or non-physician practitioner to be immediately available whenever a Medicare patient receives therapeutic services. We urge you to extend the direct supervision enforcement moratorium and advance S. 257, Protecting Access to Rural Therapy Services Act.

Finally, we remain concerned about the impact of proposed payment cuts targeting rural providers including Sole Community Hospitals and Critical Access Hospitals. We urge you to support federal programs that account for the particular economic challenges facing rural communities and reject arbitrary payment cuts.

Rural hospitals are critical to the patients they serve and the communities they support, but they also are key to the well-being of the broader health care delivery system across the commonwealth. We ask for the unified support of the delegation on these key priorities for Pennsylvania.


Andy Carter
President and Chief Executive Officer
The Hospital & Healthsystem Association of Pennsylvania

In addition, the following Pennsylvania rural providers support the priorities listed in this letter:

Barnes-Kasson County Hospital
Bradford Regional Medical Center
Clarion Hospital
Cole Memorial
Conemaugh – Meyersdale Medical Center
Conemaugh – Miners Medical Center
Corry Memorial Hospital
Endless Mountains Health System
Fulton County Medical Center
Geisinger – Lewistown Hospital
Grove City Medical Center
Hanover Hospital, Inc.
Indiana Regional Medical Center
JC Blair Memorial Hospital
Jersey Shore Hospital
Kane Community Hospital
Lock Haven Hospital
Meadville Medical Center
Memorial Hospital, Inc.
Muncy Valley Hospital
Nason Hospital
Penn Highlands Brookville
Penn Highlands Clearfield
Penn Highlands Elk
Pocono Medical Center
Punxsutawney Area Hospital, Inc.
Schuylkill Medical Center – East Norwegian Street
Soldiers + Sailors Memorial Hospital
Somerset Hospital
Southwest Regional Medical Center
St. Luke’s Hospital – Miners Campus
Sunbury Community Hospital
The Bucktail Medical Center
The Ellwood City Hospital
Titusville Area Hospital
Troy Community Hospital
Tyler Memorial Hospital
Tyrone Hospital
UPMC Bedford Memorial
Warren General Hospital
Waynesboro Hospital

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