The President recently outlined his vision for reform, building upon the Senate’s Patient Protection and Affordable Care Act (H.R. 3590), and called on Congress to act quickly to pass a legislative package before its Easter recess. Congressional Democratic leaders are working on a legislative strategy that calls for the House to pass H.R. 3590, followed by a smaller “sidecar” bill that would make certain changes, including those outlined by the President, to the Senate bill. The Senate would then take up the “sidecar” bill on a simple up-or-down vote through a process known as reconciliation. HAP members are urged to contact their member of Congress as outlined in HAP Memo 10-34.

The House Appropriations Committee this week approved House Bill 2279, which essentially reflects the Governor’s budget plan for fiscal year 2010-2011, by a party-line 21-14 vote. The bill does not include the Governor’s proposed sales tax expansion and tax on gas drilling. The bill does include the Governor’s proposed reductions of about $26 million in state Medicaid funding for hospitals. House Republicans said they would not support the $29 billion budget, which relies on $850 million in federal Medicaid funds (through an enhanced federal Medical Assistance percentage, known as FMAP) that have not yet been approved. A full House vote is expected during the coming weeks. HAP continues to work with legislators to help them understand the budget’s implications for hospitals.

While hospitals account for one-third of the health care dollar, spending on hospital care has grown more slowly than spending on other health care services, according to a new American Hospital Association (AHA) report on the sources of growth in spending on patient care in hospitals. Spending for hospital care rose by 4.5 percent between 2007 and 2008, far less than health insurance premiums. Based on data from the Centers for Medicare & Medicaid Services and the AHA Annual Survey, the report shows that rising costs to hospitals for the goods and services purchased to provide care accounted for 64 percent of overall growth in spending on hospital care from 2004 to 2008, while rising demand for care accounted for about 34 percent.