ACLA's written and oral statement on H.R. 10460, as well as its statement on Competition in the Independent Laboratory Market (submitted to the Subcommittee on February 23, 1978) apply with equal force to Section 213 of the Administration's bill. If you have any questions, please do not hesitate to contact me. Sincerely yours, 1. Robert Halper H. Robert Halper CC: The Honorable David E. Satterfield This letter represents an expanded response to a question you posed during my testimony on February 1, 1978 before the Subcommittee on H.R. 10460, Health Planning and Resources Development Amendments. Specifically, you wished to know how our recommendation could be accomplished whereby all payers recognize appropriate fixed costs associated with partial closures and conversions of hospital facilities. With respect to the Medicare program, my staff believes that no change in Title XVIII of the Social Security Act itself would be necessary to authorize recognition in the Medicare reimbursement mechanism for such costs. Rather, reimbursement allowances for such costs can be accommodated through amendment to specific sections of current regulations which govern Medicare reimbursement to hospitals. We would be pleased to work with Congressional staff on identifying the specific sections of these regulations that would need to be modified. With respect to Medicaid Programs, where considerable variability exists among the states in specific hospital reimbursement practices, amendment in Title XIX legislation may well be necessary to insure sufficient uniformity on this matter. Should the appropriate changes be accomplished in the key government health financing programs, we envision few obstacles to the Blue Cross organization, the other major contracting third party hospital payment mechanism, successfully accomplishing the same result on a voluntary basis in cooperation with member health care institutions. Based on the nature and extent of state governmental regulation of an individual Plan's premium rates, contracts with hospitals, and/ or payments to hopsitals, the need may arise in selected locales for Plans to work closely with state government to achieve the desired result; however, the weight of general public opinion in favor of such a payment program should serve to ensure the necessary degree of cooperation among the Plan, hospitals, and state regulatory bodies. If you have any more questions, please feel free to contact our Washington office and we will provide whatever further assistance we can. Sincerely, Heel Hollandin Neil Hollander Vice President In his recent testimony before the Subcommittee on Health and the Environment, Mr. Hale Champion, Under Secretary of HEW, stated that DHEW intended to propose amendments to Public Law 93-641, the Health Planning and Resources Development Act of 1974. Later in the hearings, I requested that the witnesses before our Subcommittee be given an opportunity to comment on these proposals prior to mark-up sessions by the Subcommittee. Chairman Rogers agreed and ordered that the hearings record remain open to receive such comments for a period of at least 10 days following receipt of the proposed amendments. The DHEW draft bill has now been received and a copy is enclosed for your consideration. If you desire to comment please do so in writing and mail to: Honorable Paul G. Rogers, Chairman Subcommittee on Health and the Environment ATTN: Bob Crane Comments must be received no later than February 24th. I would also appreciate it if you would send a copy of your comments to me. With best wishes, I am DES/JJ/al Sincerely yours, DAVID E. SATTERFIELD, III 95TH CONGRESS 2D SESSION H. R. 11077 IN THE HOUSE OF REPRESENTATIVES FEBRUARY 22, 1978 Mr. STAGGERS introduced the following bill; which was referred to the Committee on Interstate and Foreign Commerce A BILL To amend title XV of the Public Health Service Act to revise and extend the authorities and requirements under that title for health planning, to provide for assistance to hospitals in discontinuing inappropriate services, and for other 1 purposes. Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 4 SHORT TITLE AND REFERENCES IN ACT SECTION 1. (a) This Act may be cited as the “Health 5 Planning Amendments and Hospital Services Discontinua6 tion Act of 1978". 7 (b) Whenever in this Act an amendment or repeal is 8 expressed in terms of an amendment to, or repeal of, a |