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Contact: Media Relations Officer, (202) 828-0975.
Clinton Medicare Proposal
Statement From
Jordan J. Cohen, M.D.
President, Association of American Medical Colleges
June 30, 1999
As our nation's elderly population swells dramatically over the next three decades, the need for Medicare to be responsive to the increasing demands for the program's services is of paramount importance. President Clinton's Medicare proposal aims to create just such a program. However, while the Medicare proposal's long-term objectives are laudable, they fall short in their ability to repair the damage already inflicted by the Balanced Budget Act of 1997 (BBA). The Administration's proposal fails to recognize that Medicare beneficiaries need more than just prescription drug benefits, they also need a financially stable system of health care providers, including teaching hospitals, that offer a breadth of quality services.
Teaching hospitals, and many other providers, are hurting now. The BBA cut far more deeply than was originally anticipated. A competitive and efficient Medicare program that provides quality care and supports the training of the best doctors will never be achieved if teaching hospitals-the backbone of our health care system-do not remain strong. Teaching hospitals train most of the country's new physicians and provide over 40% of hospital uncompensated care. If the cuts called for in the BBA continue, some 40% of all major teaching hospitals, nearly 100 institutions, may actually be losing money by 2002. Where will the elderly turn for the latest and most sophisticated services if they are no longer provided at their nearby teaching hospital?
The financial troubles now facing many teaching hospitals, in part, are the unintended consequences of the BBA, which the new Medicare proposal needs to more aggressively address. While President Clinton's proposed provider set-aside of only $7.5 billion over 10 years is insufficient to ease even the most troublesome BBA provisions, we do appreciate the Administration's plans to pay hospitals directly for the uncompensated care they provide rather than to managed care organizations.
The Association of American Medical Colleges (AAMC) is also concerned that the Medicare proposal would extend some of the BBA provisions beyond 2002, the final year of implementation. The potential for additional Medicare cuts to teaching hospitals could be disastrous.
The AAMC applauds the Clinton Administration's continuing efforts to improve the Medicare program. The Administration's plan to provide long-term financing for Medicare advances this critically important debate. Likewise, the proposal to provide prescription drugs ensures this issue will be central to the ongoing Medicare deliberations. But providers cannot carry the cost burden of these new benefits at a time when they are struggling to maintain their existing services.
The AAMC plans to work closely with the Congress and Administration to create a Medicare program that improves the health of its beneficiaries but does so without jeopardizing the viability of health care providers.
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The Association of American Medical Colleges represents the 125 accredited U.S. medical schools; the 16 accredited Canadian medical schools; some 400 major teaching hospitals, including 74 Veterans Administration medical centers; 87 academic and professional societies representing nearly 88,000 faculty members; and the nation's 67,000 medical students and 102,000 residents.
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