A $15 million to $20 million windfall for Oregon hospitals participating in the Medicare program was included in the Senate budget reconciliation bill at the request of the staff of the Senate Finance Committee, headed by Sen. Bob Packwood (R-Ore.), Capitol Hill sources said yesterday.
The bill provides a set of rules for Oregon hospitals for the next 1 1/2 years that differs from those for other states, the sources said.
Packwood's communications director, Etta Fielek, said late yesterday that "everybody is out of town" who could answer questions about the provision and "our office cannot confirm" or comment on the report.
Other Hill sources said, however, that the provision was included in the latest version of the deficit-cutting reconciliation bill passed by the Senate Friday and expected to come to the House floor today.
The provision involves the transition to a national Medicare payment system based on flat rates for each illness rather than actual daily costs at each hospital. Under the system, Oregon hospitals, which have lower costs than many other states', will do well under the flat-rate system because the new rates are higher than Oregon hospitals' costs. Hospitals in many other states will do poorly because their costs are higher than the flat rate.
Under the system approved by Congress in 1983, the basic flat rates were to be phased in over several years. The first year, 25 percent of a hospital's payment for each case was to be based on the new flat rate and 75 percent on the hospital's cost. The second year, it would be 50-50, moving to the 100 percent flat rate in later years.
The reconciliation bill amendment would speed Oregon's transition to the new flat rate.
Hospitals in all states are now at the 50-50 level. From May 1 to Oct. 1, the bill would base 55 percent of the payment on the national rate and 45 percent on hospital cost.
But under the special Oregon provision, sources said, Oregon would get 75 percent of its payment from the national rate.
And in the fiscal year from Oct. 1, 1986 to Oct. 1, 1987, the sources said, hospitals in other states would be paid 75 percent on the basis of the national rate, but Oregon would be paid 100 percent on the basis of the national rate.
Sources said that Oregon's hospitals would get up to $20 million more under this provision than if they followed the same rules as other states.