Senate Minority Leader Chuck Schumer (D-NY) and Representatives Brian Higgins (D-NY) and Lee Zeldin (R-NY) began circulating a New York delegation sign-on letter this week in objection to the Centers for Medicare & Medicaid Services’ (CMS) proposed changes to the Medicare area wage index formula. The changes are part of CMS’s fiscal year 2020 inpatient prospective payment system proposed rule. This budget-neutral proposal would reduce the wage index for hospitals in areas above the 75th percentile and increase the wage index for those in the 25th percentile or below. If implemented, the policy would unfairly and arbitrarily redistribute wage index funding. No GNYHA members in New York, New Jersey, Connecticut, and Rhode Island would benefit, and most would be negatively impacted.

The delegation letter notes that while CMS states that this proposal is meant to help rural hospitals, not a single rural hospital in New York State would benefit from this policy. The letter also notes that the policy disregards that market forces are a significant contributing factor to elevated wages in states like New York, and that it would force hospitals in higher-wage areas “to transfer hundreds of millions in Medicare funding to a small handful of states.” The letter requests that CMS not finalize this harmful wage index proposal.

More information can be found here. GNYHA will work with our allies to generate support for this important letter.