AHA Statement Before the Committee on Energy and Commerce Subcommittee on Health Re: Medicare Legislative Proposals


of the

American Hospital Association

for the

Committee on Energy and Commerce

Subcommittee on Health

of the

U.S. House of Representatives

“What’s the Prognosis? Examining Medicare Proposals to Improve Patient

Access to Care & Minimize Red Tape for Doctors”

October 19, 2023

On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, our clinician partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the American Hospital Association (AHA) writes to share the hospital field’s comments on legislative proposals for consideration before the Energy and Commerce Committee Health Subcommittee on Oct. 19. We share the committee’s commitment to providing the highest quality, best value health care for Medicare beneficiaries.


H.R.___, the Improving Seniors’ Timely Access to Care Act of 2023

The AHA supports the Improving Seniors’ Timely Access to Care Act of 2023, which would help ensure access to care by streamlining prior authorization requirements under Medicare Advantage (MA) plans, including by making them simpler and more uniform and eliminating the wide variation in prior authorization requirements that frustrate both patients and providers. The legislation also requires MA plans to create a process of “real-time decisions” for services that are routinely approved, report on their use of prior authorization and the rate of approvals and denials and adopt policies that adhere to evidence-based guidelines.

While prior authorization, when used appropriately, can help align patients’ care with their health plan’s benefit structure, it is frequently applied inappropriately in ways that delay care and harm patients, as evidenced by a recent report by the Department of Health and Human Services Office of Inspector General that found 13% of MA plan prior authorization denials met Medicare coverage rules and should have been granted. In addition, a 2021 survey by the American Medical Association of more than 1,000 physicians underscores the negative impact on patient care resulting from prior authorization, finding that more than one-third (34%) of physicians reported that prior authorization led to a serious adverse event, such as hospitalization, disability or even death, for a patient in their care. Also, more than nine in 10 physicians (93%) reported care delays while waiting for health insurers to authorize necessary care, and more than four in five physicians (82%) said patients abandon treatment due to authorization struggles with health insurers. The statistics indicate that prior authorization policies are routinely not in the best interest of patients and can have detrimental effects on their care and clinical prognosis. These practices also add financial burden and strain on the health care system through inappropriate payment denials and increased staffing and technology costs to comply with MA plan requirements. They are also a major burden to the health care workforce and contribute to provider burnout. It is more important than ever to have greater oversight and accountability of MA plans, as provided for in this bill, to ensure their payments are being used for the intended purpose of paying for care.


H.R.___, To amend title XVIII of the Social Security Act to revise certain physician self-referral exemptions relating to physician-owned hospitals

America’s community hospitals and health systems welcome fair competition, where health care entities can compete based on quality, price, safety and patient satisfaction. But physician-owned hospitals (POH) — where physicians select the healthiest and best-insured patients and self-refer those patients to facilities in which they have an ownership interest — represent the antithesis of competition. The AHA strongly opposes any changes that would either expand the number of POHs or ease restrictions on the growth of existing facilities. Allowing more POHs in rural areas could be particularly destabilizing because these areas already have a limited patient population, with hospitals struggling to maintain fixed-operating costs. Indeed, 150 rural hospital and health systems have closed since 2010, which has had a detrimental impact on their communities.

Congress acted in 2010 to close the “whole hospital” loophole in the Stark law and placed restrictions on POHs. That provision represented a carefully crafted compromise to protect hospitals with a Medicare provider number as of Dec. 31, 2010, and allow those facilities to expand when increased hospital capacity is needed.

Several analyses, including by the Congressional Budget Office, Medicare Payment Advisory Commission (MedPAC) and independent researchers, have concluded that physician self-referral leads to greater per capita utilization of services and higher costs for the Medicare program. In fact, according to the Congressional Budget Office, closing the “whole hospital” exception loophole in the Stark law reduced the federal deficit by $500 million over 10 years. Bills that would ease or repeal the 2010 law would help erase those savings and increase the federal deficit.

Furthermore, POHs tend to select the most profitable patients and services, jeopardizing communities’ access to full-service hospital care. The Government Accountability Office, Centers for Medicare & Medicaid Services (CMS) and MedPAC found that patients in POHs tend to be healthier than patients with the same diagnoses who are cared for by community hospitals. This practice of self-referring physicians carefully selecting their patients creates a destabilizing environment that leaves sicker and less-affluent patients to community hospitals, thereby placing these hospitals at a distinct financial disadvantage. This is because community hospitals rely on cross-subsidies from those services targeted by POHs to support essential, but under-reimbursed, services such as emergency, trauma and burn care. In this way POHs threaten the ability of community hospitals to offer quality, comprehensive care and serve as the health care provider for all patients, regardless of income or insurance status, in their communities.


H.R. 2377, the Saving Access to Laboratory Services Act

Without Congressional action, hospital laboratories will face cuts as large as 15% on some of the most common tests, which will reduce access to clinical laboratory services and drive up the cost of care for patients and taxpayers. The AHA supports the Saving Access to Laboratory Services Act (SALSA) (H.R. 2377), which would update Medicare’s payment system for clinical diagnostic laboratory services and reduce data reporting burdens. This bill would strengthen the clinical laboratory infrastructure and ensure that hospital labs are able to continue providing these critical services to patients.

H.R.___, To amend title XVIII of the Social Security Act to revise the phase-in of clinical laboratory test payment changes under the Medicare program

If Congress is unable to pass SALSA by the end of the year, we would support a bill to revise the phase-in of clinical laboratory test payment changes under the Medicare program. This would delay the harmful cuts to the Clinical Laboratory Fee Schedule as well as the next round of private payer rates reporting that are both scheduled to go into effect on Jan. 1, 2024, under the Protecting Access to Medicare Act.


H.R.___, the Fewer Burdens for Better Care Act of 2023

To improve the quality of care that patients receive, the AHA supports this bill to streamline reporting of the Medicare Quality Measures by calling for CMS to produce a list of measures it is considering removing from the program.


H.R. ___, To amend title XVIII of the Social Security Act to exempt certain practitioners from MIPS payment adjustments under the Medicare program based on participation in certain payment arrangements under Medicare Advantage

The bill would ensure MA alternative payment model (APM) participation is counted towards advanced APM calculations, and that those physicians participating in MA APMs at a high enough rate could be exempted from the Merit-based Incentive Payment System (MIPS). The AHA supports this legislation.

H.R.___, To amend title XVIII of the Social Security Act to allow for the use of alternative measures of performance under the Merit-based Incentive Payment System under the Medicare program

The legislation updates CMS’s "facility-based measurement" in the MIPS for clinicians who perform enough of their work in a hospital setting using quality and cost measures from CMS's hospital measurement programs, instead of asking them to report MIPS measures separately. This would enable more clinicians to take advantage of the facility-based scoring option and could assist with hospital–physician alignment in quality efforts. The AHA supports this legislation.

H.R.___, To amend title XVIII of the Social Security Act to extend incentive payments for participation in eligible alternative payment models

The AHA supports the provision of this legislation that extends the Advanced APM incentive payment at 3.5% for the calendar year 2026 period (though we would have preferred this amount restored to the 5% level). We are opposed, however, to the provision of the bill that imposes a five-year cap on qualifying for payments; this will negatively impact those who are already enrolled in the Advanced APM models.


H.R.___, the Telehealth Privacy Act of 2023

Current waivers are in place allowing practitioners to render telehealth services from their home, without having to report their home address on Medicare enrollment or claims forms. Beginning Jan. 1, 2024, these providers will be required to report their home address. The AHA is deeply concerned with this requirement and recommend it be eliminated. It poses potential privacy issues to providers as home addresses may be publicly available without their knowledge or consent on sites like Medicare Care Compare. Requiring providers to list their personal home addresses on enrollment and claims forms, to which patients or others in the public have access, poses privacy and safety risks given the increased incidence in violence against health care workers. Requiring providers to list their home address may disincentivize them from delivering telehealth services altogether (since they do not want their personal address listed publicly) and as such minimize telehealth’s potential as a workforce retention tool for organizations. Hospitals and health systems also are concerned about the operational and administrative burden of completing enrollment forms for provider home addresses, as well as tracking and reporting changes in providers’ home addresses if they move. The AHA appreciates that this bill would ensure the privacy and safety of providers that deliver telehealth services from their homes by preventing providers’ home addresses from being publicly available but encourage Congress to remove the requirement all together.


Thank you for your consideration of the AHA’s comments on these legislative proposals. We look forward to continuing to work with you to address these important topics on behalf of our patients and communities.