A tough new hospital cost control bill with severe federal penalties for hospitals that cheat or charge too much is to be sent to Congress today by President Carter.
He is expected to tell a White House news briefing that the measure will be a crucial test of Congress' sincerity in fighting the inflation that is crippling the country -- a message he delivered in his State of the Union address last January.
It was learned yesterday that the administration already has launched a three-pronged lobbying effort, not only in Congress but also with leaders of industry, who are paying larger and larger health insurance premiums for their workers.
Two White House teams -- one under Vice President Mondale'sstaff chief, Richard Moe, and the other under presidential aide Anne Wexler -- have joined Department of Health, Education and Welfare lobbyists to try to put the measure across.
A copy of the bill obtained by The Washington Post reveals strenuous efforts ot win hospitals' support, but harsh punishments for those refusing to cooperate.
Heavy lobbying by hospital and medical interests narrowly defeated last year's bill in the House Commerce Committee after weeks of hearings, bitter debates and innumerable votes on hard-fought details.
The proposed bill would rely first on voluntary efforts by hospitals to try and control costs. But failure to do so would automatically trigger federal controls starting next January, or in any subsequent January when hospital efforts were faltering, under the bill.
The administration thus adopts an idea suggested last year by Rep. Dan Rostenkowski (D-III.), then head of the House Ways and Means health subcommuttee. The administrartion at first opposed this proposal. But it gave birth to the hospitals' own "Voluntary Effort," an industrywide campaign to keep down price increases to prevent federal control.
Under the new Carter bill:
The HEW secretary would "promulgate" an annual "voluntary percentage limit" for the average nationwide increase in hospital costs -- and a similar list for every state and every hospital, based on federal formulas. For 1979, the national limit would be 9.7 percent, a goal already announced by HEW Secretary Joseph A. Califano Jr. Leaders of the hospital effort have said they must have an 11.6 percent increase or cut services.
Under a proposed amendment to the Interal Revenue Codi, a hospital could be forced to pay the government a penalty of 150 percent of any overcharges.
Hospitals trying to juggle the kind of patients they admit -- for example, turning away the poor -- to maximize income could lose their eligibility to collect Medicare and Medicaid payments, a penalty that could close many hospitals.
A hospital that keeps its cost increases below the federally set target might get a 1 percent "bonus" to spend as it pleases in the coming year. One that failed to meet the goal might get a 2 percent "penalty" or a cut in its coming year's allowance.
The federal limits would take into account hospitals' wage increases for workers, except for doctors and supervisors. Organized labor demanded this provision in return for its support.
The formulas would take into acdount the high cost of the "hospital market basket" -- the high prices hospitals must pay for fuel and medical supplies -- and allow hospitals an added 1 percent a year price increase for new services and technology. Hospital leaders have argued that any controls must consider these factors, and deal with hospitals as individual institutions, not just as a class.
Hospitals also would be grouped by "appropriate characteristics" -- for example, public hospitals, hospitals caring for large numbers of aging or indigents and so on -- in deciding how much they can charge. This is a feature of a cost-containment measure sponsored by Sen. Herman E. Talmadge (D-Ga.), head of the Senate Finance Committee's health subcommittee and thus far an opponent of the administration approach.
The measure would cover the country's 6,000 nonfederal hospitals, but over half of these -- for example, hospitals in states like Maryland, New York and Massachusetts that have their own hospital cost-control systems, new hospitals, many small hospitals and hospitals serving prepaid health plans that are keeping their costs down -- could be exempted.
Scheduled to appear with Carter today are Califano, administration anti-inflation officials and the bill's congressional cosponsors, who are expected to include Sen. Edward M. Kennedy (D-Mass.), and Reps. Henry A. Waxman (D-Calif.) and Charles B. Rangel (D-N.Y.), chairmen of three of the four key congressional health subcommittees, as well as Sen. Gaylord Nelson (D-Wis.). Last year Nelson headed a successful last-ditch effort to steer a hospital cost-control bill through the Senate.