Press Release

AHA Statement on MedPAC Recommendations to Congress

Rick Pollack
Executive Vice President

Statement on MedPAC Recommendations to Congress
America’s hospitals are dismayed with the Medicare Payment Advisory Commission’s (MedPAC) vote to recommend reducing hospital Medicare payments.  This poor decision ignores data detailing the pressures facing hospitals and fails to take into consideration the very serious impact any reduction in payment would have on hospitals and the patients we serve. 

Hospitals currently face a Medicare system which continues to pay well below the cost of caring for its beneficiaries.  Data show that since 1997, hospitals’ total Medicare margins have fallen steadily.  And in 2004, 68 percent of hospitals lost money serving Medicare patients.  With this evidence at hand, MedPAC’s recommendation for less than a full market basket update is very troubling, and threatens hospitals’ ability to continue to provide vital health care services.

Negative Medicare margins are just one of the many challenges hospitals face every day while providing care to patients and communities across the nation.  Hospitals continue to operate under a growing workforce shortage, with rising pharmaceutical costs and increases in spending on medical supplies and devices.  And demand for hospital care continues to rise as well.  Under these very real circumstances, cuts to hospital funding are simply bad policy.

We strongly urge Congress to provide hospitals with a full market basket update to ensure that the quality health care hospitals deliver remains available to the patients hospitals serve.

About the AHA

The AHA is a not-for-profit association of health care provider organizations and individuals that are committed to the health improvement of their communities. The AHA is the national advocate for its members, which include nearly 5,000 hospitals, health care systems, networks, other providers of care and 43,000 individual members. Founded in 1898, the AHA provides education for health care leaders and is a source of information on health care issues and trends. For more information, visit the AHA website at

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