The overall Medicare bill contains a comprehensive rural health care package crafted by Grassley and Sen. Max Baucus of Montana. The package would provide over the next 10 years an additional $25 billion for rural health providers, or $377 million for Iowa.
Grassley said his latest effort is to increase the dollars flowing to Iowa immediately, beginning in 2004. This afternoon, he and Baucus filed an amendment to the pending legislation that would increase the already robust rural package by over $1 billion for 2004, or about $15 million for Iowa.
Grassley said it's necessary to do more for this one year out of the 10 years covered by the legislation because of a budget issue that affected the Senate Finance Committee when it approved the Medicare legislation last week. In short, the Budget Committee chairman objected to the Finance Committee approving additional expenditures beyond the extension of unemployment insurance, assistance to states, and the refundable child tax credit that had already been passed this year.
Grassley said that "Now that the bill is on the floor, I want to see the rural package enhanced for 2004," Grassley said.
Specifically, the Grassley-Baucus amendment would bring the labor share of the wage index to 62 percent. It applies the standard payment amount to all hospitals immediately. It holds rural hospitals harmless from payment changes under the outpatient prospective payment system next year. And it immediately corrects the geographic inequity that pays rural doctors less for the same service than their urban counterparts.
This package, unlike other approaches that simply add money on top of existing flawed formulas, makes fundamental changes to underlying formula flaws that discriminate against Iowa doctors and hospitals.
The overall Medicare bill under debate is the first major expansion of the federal government's 38-year-old health program. The bipartisan proposal would strengthen Medicare and add a prescription drug benefit, along with fixing the flawed Medicare payment formulas that shortchange health care delivery systems in rural states like Iowa.
Grassley is chairman and Baucus is ranking member of the Senate Committee on Finance, which is responsible for all Medicare legislation.