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[Congressional Record Volume 154, Number 160 (Thursday, October 2, 2008)]
[Senate]
[Pages S10456-S10458]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

                         OBJECTION TO DISCHARGE

  Mr. GRASSLEY. Mr. President, as the ranking Republican of the Finance

[[Page S10457]]

Committee acting on behalf of a number of Republicans on the Finance 
Committee, I am objecting to discharging S. 3656 from the committee. 
While there are several provisions in the bill I personally strongly 
support, there are many problems in this bill and questions that have 
been raised about this bill. In addition, this bill has not come before 
the committee and the issues it addresses have not had the benefit of 
hearings or any committee action. As a result, I cannot support this 
bill being discharged from the committee at this time.
  One of the provisions in S. 3656 that I personally support would 
delay implementing provisions of a CMS proposed rule that would change 
conditions of participation for rural health clinics and decertify 
clinics that are no longer in nonurbanized areas. The provision would 
also delay the proposed changes to the existing payment methodology for 
rural health clinics and Federally qualified health centers.
  The CMS proposed rule would impose new location requirements for RHCs 
and require that clinics be located in a nonurbanized area, as defined 
by the U.S. Census Bureau, as well as meet shortage area designation 
requirements. Only new RHCs applying for the program are currently 
required to meet these criteria, but the CMS proposal would extend 
these requirements to already certified RHCs. According to CMS, about 
500 of the approximately 3,700 RHCs operating today may not meet these 
requirements. Rural clinics in Iowa and elsewhere could also be 
severely impacted by the CMS proposed payment changes since RHC costs 
in Iowa and other States are already higher than the existing Medicare 
reimbursement cap.
  Iowa is currently in the throes of a growing shortage of physicians, 
especially in the more rural areas of the State, due to inequitable 
geographic adjustments in physician payment that result in Iowa 
physicians receiving some of the lowest Medicare payments in the 
country even though they provide some of the highest quality care. 
These geographic payment disparities, which discriminate against rural 
areas, have further exacerbated the problems of access to care for 
beneficiaries in rural areas.
  The CMS proposed rule could have a severe adverse impact on a number 
of rural health clinics in Iowa, including many located in counties 
that have been declared disaster areas from the severe flooding Iowa 
suffered earlier this year. If the CMS rule is finalized as proposed, 
rural health clinics in Iowa and elsewhere may be forced to close their 
doors, even though they have served rural populations very well for 
many years, leaving Iowa with fewer physicians and some patients with 
little access to primary care and other critical medical services.
  As you can see, these provisions for rural health centers are 
important, which makes it all the more disappointing that my friends on 
the other side of the aisle did not work together with us to develop a 
bipartisan bill and that the committee is not in a position at this 
time to consider these important issues properly. I am very pleased, 
however, that a key issue for rural health centers in the proposal has 
already been addressed through a provision that was included in the 
Health Care Safety Net Act. That provision changes the CMS 
certification period for shortage area designations from 3 to 4 years 
in order to align the CMS certification period for shortage area 
designations with the Health Resources and Services Administration's, 
HRSA's, designation review period. I want to thank Senators Orrin 
Hatch, Pat Roberts, Gordon Smith, Tom Harkin, Ron Wyden, Kent Conrad, 
and John Barasso for championing the resolution of this important issue 
and Senator Max Baucus for working together with me to facilitate its 
inclusion in the Health Care Safety Net Act. And, of course, I want to 
again thank Senators Kennedy and Enzi for working with us on this 
issue. Thanks to this bipartisan collaborative effort, that bill with 
the RHC provision in it has now passed both Chambers and is on its way 
to being signed into law.
  Another provision in S. 3656 would prevent the application of a CMS 
policy to phase out a payment adjustment for indirect medical 
education, IME, under the Medicare capital Inpatient Prospective 
Payment System, IPPS. Currently, teaching hospitals receive this upward 
payment adjustment under the capital IPPS. CMS announced in the fiscal 
year 2008 Medicare Hospital IPPS final rule that they would begin to 
phase out the IME adjustment for capital IPPS in fiscal year 2009.
  As the former chair and currently the ranking member of the Senate 
Finance Committee, it has long been one of my priorities to ensure 
Medicare payments are both accurate and equitable. I question whether 
this proposed change to IME payments would further this goal, which 
many of us share.
  The appropriateness of the IME capital IPPS adjustment has been 
analyzed extensively not only by CMS, but also by the Medicare Payment 
Advisory Commission, MedPAC, which advises Congress on Medicare payment 
issues. CMS has documented relatively high and continued positive 
margins for teaching hospitals under the capital IPPS compared to 
nonteaching hospitals. In fact, from 1998 through 2006, teaching 
hospitals had an aggregate positive capital IPPS margin of 11.2 percent 
while nonteaching hospitals had an aggregate capital IPPS margin of 
-0.8 percent. Based on those figures, it leaves open the question of 
whether the proposed change to IME payments is not justified. Certainly 
this is something the Finance Committee should explore further.
  S. 3656 also proposes to establish a moratorium on a CMS rule 
regarding Medicaid payments for hospital outpatient services. Earlier 
this year, Congress placed moratoriums on 6 other proposed Medicaid 
regulations. Just as I opposed those moratoriums, I strongly oppose 
this one as well. The Finance Committee has not held the first hearing 
as to why a delay in this regulation is justified. The Finance 
Committee has not considered whether payments currently being made by 
some states to hospitals for outpatient services are being made 
consistent with the statutory rules governing the upper payment limit. 
The CMS regulation in question was intended to clarify what payments 
from States to hospitals are allowable. We should not simply place a 
moratorium on this regulation without the committee properly 
investigating the issue first. Medicaid is a critical program for 
children, pregnant women, the disabled, and the elderly. We have a 
responsibility to the people who depend on the program to make sure 
that funds are being appropriately spent. Placing a moratorium on these 
regulations without fully exploring these issues in the committee first 
is not consistent with that responsibility.

  This bill also would intervene in a dispute between CMS and the State 
of California. The State of California has been seeking approval of an 
extension of their family planning waiver for 6 years. For 6 years, CMS 
has been urging California to improve their collection of Social 
Security numbers and citizenship documentation for women enrolled in 
the program. Given the concerns that have been raised about noncitizens 
receiving benefits to which they are not entitled, this provision 
raises a number of serious concerns. This bill would essentially 
require CMS to approve of the extension of California's waiver without 
requiring California to fulfill their obligation to improve their 
process of ensuring that people who receive benefits are actually 
eligible for those benefits.
  In addition, this bill does nothing to assist ``tweener hospitals,'' 
which are hospitals that are too large to be critical access hospitals 
but too small to be financially viable under Medicare's prospective 
payment systems. I consider this to be a high priority because so many 
seniors in Iowa rely on these tweener hospitals for vitally needed 
health care services in rural areas of our State. If the Senate is 
going to consider Medicare legislation that is along the size and scope 
of the provisions proposed in S. 3656, including provisions to address 
the problems tweener hospitals face is a must.
  I understand that legislation is often the art of compromise. We 
can't always get everything we want in every bill and keep everything 
we dislike out. It is a balance. This bill is currently pending before 
the Finance Committee, and it raises significant issues of Medicare and 
Medicaid payment policies. The Finance Committee has not held hearings 
on these issues nor has it given these important issues proper 
consideration. Without allowing the

[[Page S10458]]

committee process to work, this bill has not been subject to the 
rigorous analysis and debate that the legislative process should 
require to avoid unintended consequences and poor decisionmaking. This 
process should be permitted to take place before legislation of this 
magnitude is sent to the full Senate. That is the committee's role and 
it is an important one.
  If the full Senate were to routinely bypass the Finance Committee and 
consider major Medicare bills like this one that have not been 
processed by the members of the committee, then nothing would prevent 
the Senate from legislating on other Medicare and Medicaid issues 
without the benefit of hearings or committee action. Occasionally, the 
committee does process extensions of current law and smaller, generally 
technical bills through a more informal committee process, but it is a 
committee process nonetheless. If the committee is routinely bypassed 
entirely and not allowed to perform its vital role in the legislative 
process, it would be almost impossible to cope with the number and 
assortment of Medicare, Medicaid, and other issues that would come 
directly to the Senate floor in bills like S. 3656. To avoid that 
result is why the Senate has committees in the first place.
  Just an initial review of this legislation today produces more 
questions than answers and many obvious and serious concerns. It is 
disappointing that some of the important provisions in this bill, like 
the rural health center provisions and IME policy, are packaged into a 
bill that has not been presented in a timely way or brought before the 
committee for appropriate consideration, debate, and amendment. Just a 
quick review of this bill today quickly reveals, in any case, that both 
in terms of process and policy, this bill does not sufficiently achieve 
a balance I think is necessary, and I must, on behalf of myself and 
other members of the committee, object to discharging S. 3656 from 
committee for consideration by the full Senate.

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