President signs two-year budget deal

The president Nov. 2 signed into law the Bipartisan Budget Act, P.L. 114-74, passed by Congress last week to raise the nation’s debt limit and set spending targets for the federal budget for the next two fiscal years. Site-neutral payments for new provider-based hospital outpatient departments are included in the legislation – a provision that was strongly opposed by the AHA.

The Senate on Oct. 30 voted 64-35 to pass the bill and send it to the White House for enactment. The House approved it Oct. 28 on a vote of 266-167.

The legislation extends the debt ceiling to March 2017 and raises the discretionary spending caps imposed in 2011 under sequestration by $80 billion above current levels, split evenly between defense and non-defense spending. 

Of this amount, $50 billion will be available in fiscal 2016 and $30 billion will be available in fiscal 2017. The House and Senate Appropriations committees will decide exactly how this money will be parceled out among the various agencies and federal programs.

The legislation also will stave off an impending increase in Medicare Part B premiums for some seniors.

The cost will be offset in part by implementing site-neutral payments for new provider-based hospital outpatient departments – those that come into being after the Nov. 2 enactment of the legislation. Beginning Jan. 1, 2017, these departments would not be eligible for reimbursements under the outpatient prospective payment system, but would instead be eligible for reimbursements from either the ambulatory surgical center or physician payment systems. The legislation also would extend the 2% Medicare sequester for an additional year. 

For more details on the legislation, see the AHA’s Oct. 30 Special Bulletin for members.

In a recent message to hospital and health system leaders, AHA President and CEO Rick Pollack expressed the association’s deep disappointment with the legislation’s restrictions on payments for care at new provider-based hospital outpatient departments.

He said the measure “erodes a service vital to many sicker, poor, minority and senior patients, especially in rural communities.” Pollack also said the association will press Congress to make changes to the policy in the coming weeks.

Lawmakers must pass a new government spending package before Dec. 12, which will be based on the parameters of this new budget deal.