On February 22, President Clinton announced his plan for reducing medical errors, endorsing a state-based system of mandatory reporting of preventable errors that cause death or serious injury with voluntary reporting of “near misses.” The President’s plan also includes a requirement that any hospital receiving Medicare funds have in place patient safety programs that prevent medical errors and proposes a new Center for Quality Improvement in Patient Safety. The center will use an annual budget of $20 million to conduct research, develop national goals, issue an annual report on patient safety, and translate findings into best practices. While the American Hospital Association has indicated that the President’s plan is an important part of the debate, it cautioned that the plan left many unanswered questions, including the need for better protection of doctors and nurses who come forward to report errors.
BBA relief 2000 is underway. The American Hospital Association kicked off this year’s BBA relief campaign with a rally at its annual meeting attended by over 400 hospital executives, which featured a rousing speech by Senator Edward Kennedy. AHA is advocating a “cost of caring” adjustment, making the case that larger inflation adjustments are warranted in Medicare payments for inpatient care given steady growth in costs for drugs, blood products, new technologies, and personnel. Also on the list is a freeze in planned cuts to Medicaid payments that compensate hospitals providing a “disproportionate share” of care to low-income patients, and a ban on any further reductions in the Medicare indirect medical education (IME) payment.
To bolster the case for additional BBA relief, AHA released a new analysis from The Lewin Group which projects that almost 6 out of 10 hospitals will have negative Medicare margins by 2004 despite last year’s BBA relief package. The relief bill only gave hospitals 1 percent more in Medicare payments over the next five years, according to Lewin; depending on cost growth, Lewin predicts that total Medicare margins, on average, will drop to negative 1.6 percent or negative 6.6 percent by 2004.