Grassroots Spotlight: WHA Talks Surprise Billing with Congressman Steil at Mercyhealth - Walworth

September 10, 2019

The Wisconsin Hospital Association met with Congressman Bryan Steil of Wisconsin’s 1st Congressional District for a health care roundtable discussion September 6.

The event was hosted at Mercyhealth Hospital and Medical Center-Walworth in Lake Geneva. WHA Director of Federal and State Relations Jon Hoelter kicked off the discussion with some background on issues important to WHA and its members. Hoelter stressed the importance of adequate reimbursement under Medicare, noting that while Wisconsin hospitals are known for delivering some of the best health care in the country, they receive on average only 75 cents on the dollar for treating Medicare patients. This is particularly challenging in Wisconsin, where hospitals receive significantly lower Medicare reimbursement than most states.

The group also discussed concerns about recent issues making it more difficult for hospitals to serve their communities, such as site-neutral payments. Hospitals in Congressman Steil’s district are projected to lose more than $70 million over the next 10 years due to the Centers for Medicare & Medicaid Services (CMS) creating a rule that WHA and others contend goes counter to law established by Congress. The rule stipulates that CMS will pay hospitals no more than it pays other settings for certain services provided in hospital outpatient departments, despite the fact that hospitals typically serve sicker patients, have higher regulatory costs, and have other costs for staffing 24/7 emergency departments that other settings do not. By changing the rules mid-game, CMS has made it very difficult for hospitals like Beloit Health System, noted Sharon Cox. She said their health system purchased clinics that were previously struggling financially in an effort to keep care closer to the community, but the site-neutral payment cuts will hamper that effort.

The group also stressed the importance of the 340B prescription drug discount savings program. Lindsay Punzenberger from Children’s Hospital of Wisconsin and Elizabeth Cliffe of Ascension Wisconsin noted how the 340B program costs the federal government nothing, but saves money for hospitals and allows them to stretch scarce federal resources. This helps hospitals fund important services in their communities, such as behavioral health, that often operate at a loss.

The topic then turned to a discussion on current concerns about surprise billing legislation being debated in Washington, D.C. Eric Borgerding, WHA president and CEO, noted that while WHA and its members have been supportive of reducing instances of surprise billing, there are serious concerns about one element in current legislation that would reimburse providers at the local median in-network rate. Jim Nemeth, vice president of finance at Mercyhealth, shared how a similar reimbursement scheme in Illinois’ worker’s compensation program makes that area of care much more challenging than in Wisconsin, where government has not artificially restricted reimbursement for needed services.

Mike Wallace of Fort Healthcare echoed those concerns and explained how a median in-network rate would function as a ceiling for negotiations because insurers would have no incentive to negotiate a higher rate with providers, knowing they could always keep a provider out of network in order to pay a lower rate. This could hurt access to local providers as insurers would have incentives to keep providers out-of-network. Congressman Steil said he appreciated hearing WHA’s thoughts on this issue, noting he has been hearing a lot about it lately and expects it will continue to receive a lot of attention when he and his colleagues return to D.C

For additional information, contact WHA Director of Federal and State Relations Jon Hoelter.

This story originally appeared in the September 10, 2019 edition of WHA Newsletter