News in brief - Sept. 18, 2000

Measure would stop Medicare pay reductions to teaching hospitals - Abortion regulation upheld

Measure would stop Medicare pay reductions to teaching hospitals

Legislation has been introduced in Congress to freeze Medicare payment reductions for indirect medical education payments to teaching hospitals.

Under the Teaching Hospital Preservation Act of 2000, IME cuts required by the Balanced Budget Refinement Act of 1999 would be frozen from their current levels of 6.5% to 6.25 % for fiscal 2001 and 5.5% in fiscal 2002 and beyond.

"IME payments are absolutely critical for teaching hospitals to be able to appropriately care for the sickest patients, provide an environment in which clinical research can flourish and train new physicians," said Jordan J. Cohen, MD, who serves as president of the Assn. of American Medical Colleges.

Since the budget act went into effect, total margins of major teaching hospitals have dropped to 2.3% in 1998 from 5.1% in 1997, said the Medicare Payment Advisory Committee in a recent report.

In a related development, the Health Care Financing Administration published a proposed rule May 5 to develop a new methodology to calculate direct graduate medical education payments.

The proposed change increases payments for teaching hospitals with current per-resident amounts that are less than 70% of a locality-adjusted national average and freezes payments for fiscal year 2001 for hospitals with per-resident amounts more than 140% of the locality-adjusted national average.

Abortion regulation upheld

The Fourth U.S. Circuit Court of Appeals last month upheld a South Carolina law that was designed to license and regulate physicians who routinely provide abortions. In a 2-1 ruling, the judges reversed a lower court decision that found the state's targeted regulation of abortion providers unconstitutional.

Plaintiffs, including Greenville Women's Clinic, Charleston Medical Clinic Inc. and William Lynn, MD, say the state is singling out abortion and placing an undue burden on women's rights to choose reproductive services. They are considering an appeal.

Abortion opponents heralded the decision as a protection for women's health. The regulations require any physician who is performing five or more abortions per month to be licensed and to meet standards for patient safety, sanitary conditions and medical competence.

In two other recent abortion rulings, the courts struck down state laws in both New Jersey and Colorado that required minors to notify or to get permission from parents or guardians prior to having an abortion.