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Brady Unveils Discussion Draft to Improve Hospital Issues in the Medicare System

November 19, 2014

Washington, DC – Today, Ways and Means Subcommittee on Health Chairman Kevin Brady (R-TX) unveiled the Hospitals Improvements for Payment (HIP) Act of 2014 discussion draft as part of the Committee’s broader effort on comprehensive Medicare reform, addressing the problems associated with Medicare’s two-midnights policy, short inpatient stays, outpatient observation stays, auditing and appeals.  Title I of the HIP discussion draft includes detailed solutions to these problems; Title II includes 19 different policies introduced by various members of the Ways and Means Committee that pertain to hospital reform.

Brady unveiled the draft legislative language with a specific request – that all stakeholders provide comment and add their voices to the legislative process.

In response to the release of the discussion draft, Brady stated, “The complex challenges facing hospitals require a comprehensive solution. This draft legislation retains the needed oversight of auditors while offering reforms to the RAC process and appeals, and an additional option to the CMS settlement proposal. It also includes a number of proposed health care policies developed by both Republican and Democrat members of Congress.

To determine the best solutions going forward we need all stakeholders to review this discussion draft carefully and provide timely, real-world feedback.”

Title I of the HIP discussion draft addresses and offers solutions for nine specific issues, including:

  • A new hospital prospective payment system;
  • A new per diem rate for short lengths of stay;
  • Repeal of the two-midnights payment reduction; and
  • Improvements to the RAC program

Title II of the HIP discussion draft contains 19 prioritized legislative goals, including:

  • Repeal of the ObamaCare moratorium on physician-owned hospitals, supported by Ways and Means Subcommittee on Social Security Chairman Sam Johnson (R-TX);
  • Expanding access to Medicare data, supported by Budget Committee Chairman Paul Ryan (R-WI); and
  • Providing relief to critical access hospitals, supported by Representative Adrian Smith.

The Ways and Means Committee welcomes public comment on the HIP discussion draft. Please send all comments on this discussion to

A fact sheet for the HIP discussion draft can be found here.
A section-by-section for the HIP draft can be found here.
More information on hospital issues in the Medicare program is available here.