March 23, 2001
Hospitals Urge Congress to Preserve Part A Surplus
On March 16 the AAMC, along with 6 other hospital organizations, wrote members of Congress asking them to protect the Medicare Part A Trust Fund surplus from being used to pay for a prescription drug benefit or program reforms.
"While there is a broad consensus that Medicare should include a prescription drug benefit, we believe that this benefit should be adequately funded; should not be financed with trust fund reserves; and should not be combined with a cap on the use of general revenue. Doing so will not only accelerate insolvency of the Medicare Part A Trust Fund, but also will jeopardize the ability of health care providers to meet a rapidly increasing demand for services" states the letter.
The question of how to finance a prescription drug benefit has been much on the minds of legislators as committees look to reform the Medicare program this year. In congressional hearings on the Bush Administration's FY 2002 budget, Secretary of Health and Human Services Tommy Thompson has been asked whether the White House's fiscal 2002 budget proposal protects Medicare's Part A Trust Fund. While Thompson has replied that he supports using the surplus for Part A and would not use the surplus to pay for a prescription drug benefit, the Bush budget has proposed putting the $526 billion trust fund surplus predicted to accrue over the next decade into a reserve fund that would total $842 billion.
The American Hospital Association, Catholic Health Association, Federation of American Hospitals, National Association of Public Hospitals and Health Systems, Premier, Inc., and VHA Inc. also signed the letter.
Information: Lynne L. Davis, AAMC Office of Governmental Relations, 202-828-0526.
