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Committee on Ways and Means
 Subcommittee on Health

For Immediate Release
Contact: Press Office 202-225-8933
October 22, 2002

CMS should create stable and predictable payments for outpatient drugs and devices, key health care leaders say

WASHINGTON - Yesterday, Republican health care leaders in Congress sent a letter to the Honorable Thomas Scully, Administrator for the Centers for Medicare and Medicaid Services (CMS), expressing concern over a proposed rule that sets Medicare hospital outpatient payment rates for 2003.

CMS provides payments to hospitals for outpatient services, including medical treatment for patients with cancer and heart conditions. Due to the complexity of these conditions, it is essential that payments be as accurate as possible. It is also imperative that beneficiaries are allowed access to new technology, a point that was conveyed in the letter.

In the letter, members asked Scully to continue to check the accuracy of the claims data, whether from CMS or other sources. If that was not sufficient, Members asked that CMS implement a more fundamental solution in order to limit the erratic changes in payment.

For the coming year, CMS is required to set new rates for outpatient drugs and devices using Ambulatory Payment Classification (APC) group rates. Even though this new methodology could result in more accurate payments if all data were identified and refined, Members raised a concern that there was not sufficient time to ensure accuracy prior to January 1, 2003. In the letter to Administrator Scully, Members offered an alternative and more fundamental solution if CMS is not able to correct the data before the year’s end.

A copy of the 2-page letter, signed by the following Republican health care leaders, will follow:

§ Rep. Bill Thomas (R-CA), Chairman of the Ways and Means Committee

§ Rep. Billy Tauzin (R-LA), Chairman of the Energy and Commerce Committee

§ Sen. Charles Grassley (R-IA), Ranking Minority Member of the Finance Committee

§ Rep. Nancy Johnson (R-CT), Chairman of the Ways and Means Subcommittee on Health

§ Rep. Michael Bilirakis (R-FL), Chairman of the Energy and Commerce Subcommittee on Health

Letter to the Honorable Thomas Scully


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