The Federation of American Hospitals, which represents the nation's 1,300 for-profit hospitals, changed its name yesterday to Federation of American Health Systems and declared war on President Reagan's proposals for new cuts of $5 billion in Medicare and $1 billion in Medicaid in fiscal 1987.
FAHS executive director Michael Bromberg said the group is working to form a grand coalition with the American Hospital Association, American Medical Association and other segments of the health industry and organizations of the elderly to kill the Reagan cuts.
"Medicare, with 7.1 percent of federal outlays, has taken 13 percent of the budget cuts since 1981," said Bromberg, a key figure in a similar coalition that killed the Carter administration's hospital cost-control bill. He said the new cuts, which call for freezes or reduced payments to hospitals, doctors and other health-care providers, threaten not just hospitals and doctors but the quality of care for 30 million Medicare enrollees.
"We can't continue to deliver more care for less money without reducing quality," he said. The AMA and AHA have already sharply criticized the cut proposals.
Bromberg also announced that because of structural changes in the health industry and expansion of some hospitals into the insurance and HMO (health maintenance organization) business, the FAHS seeks to enlarge its membership to include nonhospital for-profit health groups, on a limited basis at first; the name change reflects the expanded membership aims.
Bromberg also released a study by Don Moran, former federal budget official now with ICF Inc., a research organization, predicting that in part because of government restrictions on Medicare payments, 59 percent of a group of 5,354 hospitals studied (about 85 percent of all U.S. hospitals) will have operating deficits on patient care in 1986, and that losses on patient care would be $1.7 billion in 1985, $3.4 billion in 1986 and $2.7 billion in 1987.