Hospital lobbying in 2018 — by the numbers
Drug pricing program 340B was the marquee issue for the hospital lobby, with concentrated efforts on site neutrality, Medicaid funding, safety net hospitals, drug pricing and Medicare for all.
Hospitals and health systems doled out more cash currying support for favorable Medicare and 340B prescription drug payments last year than they did fighting efforts to repeal the Affordable Care Act in 2017.
Hospitals and nursing homes spent nearly $99.7 million lobbying in 2018, according to the Center for Responsive Politics, slightly more than the $99.63 million the industry spent the year prior. That's still $8 million away from the $107.5 million the industry spent lobbying in 2009 during the run up to the ACA.
UPMC, Tenet and Mayo Clinic have been among the five highest spending health systems since the ACA's first open enrollment period in 2014. The exceptions came with Partners Healthcare outspending Mayo in 2013-14 — and New York Presbyterian's record $1.5 million first quarter lobbying effort in 2016, filed when the health system was slapped with its $2.2 million HIPAA fine.
Ascension was the top individual hospital spender in 2018, joining most of its peers in opposing 340B cuts and Medicare bad debt reporting while supporting prescription drug pricing regulation, the VA's community care program and legislation addressing the opioid crisis.
The nonprofit's lobbying spend has been on a consistent upward trajectory since 2013.
From 2011 to 2014, Ascension's top issue was the Children's Hospital GME Support Reauthorization Act. In 2015, the group began lobbying for the Medicare Access and Chip Reauthorization Act, as well as the 21st Century Cures Act. 2016 was focused on mental health before moving on to the opioid crisis and ACA repeal in 2017. Last year saw many of the same issues, plus support for safety net hospitals.
Importantly, Ascension has been undergoing a restructure that will see the system focus more on outpatient facilities and telemedicine — and they had a pretty successful year. The system's operating income increased dramatically in 2018, from $11.5 million during the prior-year period to $36.4 million for the most recent quarter ended Sept. 30.
The American Hospital Association and and its state subsidiaries collectively topped the list of hospital groups lobbying in 2018 in terms of dollars spent at $23.9 million, a record-high for the association.
Subsidiary California Hospital Association racked up $1.4 million, almost three times as much as the second-highest-spending subsidiary in Illinois. California Gov. Gavin Newsom has been floating the idea of a state Medicare for all or single-payer system, but slowed down the rhetoric shortly after CMS Administrator Seema Verma said she would oppose any Medicare for all proposal to come across her desk. In Illinois, a Medicare for all bill has been sitting in the General Assembly for two years.
Last year's lobbying budget was spent railing against proposed cuts to drug pricing program 340B, an issue the organization spent much of the year fighting in a number of lawsuits filed against CMS. Other issues include further cuts to Medicare payments for safety-net hospitals, surprise billing and the expansion of site-neutral payments — all issues that AHA plans to continue lobbying in 2019, according to its advocacy agenda.
Also included on the agenda is support for President Donald Trump's MISSION Act and its expansion of the VA's community choice program, which allows veterans to receive care from private providers — a move many veterans organizations feel is a step too close to privatization.
AHA will also be lobbying in support of the preservation of nonprofit hospitals tax-exempt status, a hot-button issue reignited this month when Pennsylvania's attorney general filed a petition alleging nonprofit health system UPMC violated its tax-exempt status by refusing to re-up a previous agreement with rival Highmark. UPMC spent much of the year lobbying in support of the VA's community choice program.
While 340B was last year's marquee issue, the industry can expect the split House to result in gridlock on a resolution. Instead, the focus will be on site neutrality — made evident by last year's lobbying efforts and last month's lawsuit filed by 38 hospitals against HHS.
CMS says the policy will save beneficiaries and the Medicare program an estimated $380 million in 2019 and $760 million in 2020. A study commissioned by the Integrated Health Care Coalition argues just 200 hospitals could be forced to deal with a combined $628.5 million payment reduction this year.
Site-neutrality is favored by some industry groups,primarily AMA, which has argued the policy is good for physician groups, many of which have been gobbled up by consolidating health systems.
Expect heated debate from the hospital industry, but if the issue doesn't get resolved this year the hospitals will need to step up their game quickly. The rule that went into effect Jan. 1 has a gradual kick-off period that will see payments for E&M services at off-campus provider-based departments reduced by 60% in 2020, rather than the 30% cuts in 2019.
AHA President Rick Pollack wrote in a Jan. 11 blog post that there are "several areas for potential common ground" where the hospital industry can work with the administration, despite the divided Congress. Drug costs are one. Protections for pre-existing conditions are another.
Top five health system spenders in 2018:
- Ascension: $1.59 million
- UPMC: $1.51 million
- Tenet Healthcare: $1.47 million
- Mayo Clinic: $1 million
- Ochsner Health System: $850,000
At the same time, all five were outspent by post-acute care chains — Mechanicsburg, Pennsylvania-based Select Medical Holdings ($2.1 million) and Louisville's Kindred Healthcare ($2.09 million).
Five hospital associations topped the list, including the investor-owned trade group Federation of American Hospitals ($2.6 million) and the Greater New York Hospital Association ($2.42 million).
Tenet, which peaked in 2014 at $1.71 million, has tightened its advocacy budget by a few hundred thousand dollars in 2018. UPMC has slowed spending since last peaking at $1.56 million in 2013, and just this year picked up again. Mayo began hovering around the $1 million mark after spending $1.5 million lobbying hard for Medicare access and Medicaid funding in 2015.
How much the country's biggest health systems (by number of beds) spent lobbying in 2018:
- Healthcare Corporation of America (HCA): $680,000
- Community Health Systems (CHS): $160,000
- Trinity Health: $382,000
- LifePoint Health: $320,000
- Kaiser Permanente: $1.22M
The majority of Kaiser's lobbying efforts in 2018 focused on its health plan, which was responsible for $1,070,000 of the nonprofit's reported $1.22M. That's a drastic drop from years prior — the nonprofit reported $2.45 million in 2017. The last time Kaiser spent under $1.22M was 2012, when the health system reported $1.18M.
According to the Center for Responsive Politics, CHS focused on 340B, the Medicaid and CHIP Quality Improvement Act of 2017, access to care and support for rural hospitals. Trinity Health set its sights on 340B, population health, community health workers and and Medicare payments. LifePoint pushed for support for Medicaid and CHIP and curried support for rural hospitals and charity care reimbursements.
In its first year as a combined company, Advocate Aurora spent $800,000 to oppose 340B cuts and support the Medical Device Servicing Safety and Accountability Act.
HCA, the country's largest hospital operator on a facilities-owned basis, spent $680,000 this year, down from its all-time-high of $800,000 in 2017.
Medicare for all was hardly mentioned by the hospital lobby in 2017, according to the Senate lobbying database, save for provider and professional groups like the American Chiropractic Association and the National Association of Health Underwriters. Since then, however, the industry has thrown its weight against Medicare for all in 2020.
By the third quarter of 2018, HCA, Tenet, FAH and more joined insurance and pharmaceutical groups lobbying against the House and Senate Medicare for all bills. The American Medical Association included "Medicare for all," among many other issues, in the list of issues it spent $4.75 million on in the fourth quarter.
Correction: In a previous version of this article, National Rural Health Association was incorrectly listed as an organization in favor of site neutrality. The industry group opposes the policy and believes it will reduce access to care in rural communities.
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