“What we’re looking at is simple equity.”
Those were the words of U.S. Senator Frank Lautenberg (D-NJ), who was joined by his Senate counterpart Jon Corzine (D-NJ) and Congressman Robert Menendez (D-13th District) at a press conference at Jersey City Medical Center on Monday, July 19.
The conference was held to announce that a pending rule change by the federal government would lead to a $70 million increase in Medicare payments to New Jersey hospitals. The change would be to include Hudson, Bergen and Passaic counties in the New York City Metropolitan area.
The federal Office of Management and Budget (OMB) studies data from the U.S. Census, done every 10 years, on how geographical areas are grouped. Medicare uses the studies to determine reimbursement rates for hospitals.
Hospitals in the New York City Metropolitan Statistical Area have received substantially more money than hospitals outside that statistical area based on information such as area’s wage index, labor costs, the network of transportation and commuter travel in the geographical area. The decision to include the New Jersey counties closest to New York City in the Metropolitan Statistical Area would place them in an area that contains the five boroughs of New York City along with Westchester, Rockland and Putnam counties.
Twenty hospitals located in the three counties would receive a total of $48 million annually for the next 10 years, with another $22 million to be allotted to other hospitals in the rest of the state.
Politicians, hospital administrators and other officials on the New Jersey side of the Hudson lauded the decision as bringing about economic fairness for the New Jersey hospitals at a time when medical care has become competitive in terms of providing services and ensuring proper staffing .
However, political counterparts on the New York side complain that this decision could shortchange hospitals in the New York MSA by a total of $700 million over the next 10 years.
The Centers for Medicare and Medicaid Services (CMS) have been studying this decision to change the geographical boundary for several years and will issue a decision on August 1. If there’s a decision favoring the change and the inclusion of the three counties, it will not take effect until Oct. 1, when the new fiscal year begins.
Looking for fairness
The Monday press conference was one part explanation of the proposed rule change and one part rebuttal to political counterparts in New York.
“Maybe someone in Washington punching addresses into Mapquest thinks that North Jersey hospitals are right down the road from New York, but everyone knows there is a world of difference in medical costs on the two sides of the Hudson River,” griped U.S. Sen. Charles Schumer (D-NY), on the matter.
But Lautenberg said the uproar by his New York colleagues was “something of a family feud.”
Lautenberg went on to point out that many of the New Jersey hospitals, particularly those closest to New York City, are competing for the same workers and same resources with New York City area hospitals. But he also pointed out that New York has been receiving more money from the federal government for years.
“What we’re looking at is simple equity,” said Lautenberg, who also mentioned that those who were injured at the World Trade Center were brought to a number of New Jersey hospitals, including the Jersey City Medical Center.
Senator Corzine said, “There are more commuters going back and forth across the river, working in both places, we have the same labor market, the same cost of living.”
Corzine also said that the hospitals located in Putnam, Rockland and Westchester counties are being reimbursed at much higher rates, although they are farther away from New York City.
Menendez, who represents the 13th Congressional District that covers Hudson and Essex counties, spoke about how vital it is to communicate to those in Washington that this rule change has to happen.
“We are here to send a very clear and unequivocal message that we want the decision that was already decided by the federal government to include the counties of Bergen, Passaic and Hudson in the Metropolitan Statistical Area, because it calculates wage payments for our hospitals,” said Menendez.
After the meeting, state Assemblywoman Joan Quigley (D-32nd Dist.), also the vice president of external affairs for the Bon Secours & Canterbury Partnership for Care that operates Christ Hospital and St. Francis Hospital in Jersey City and St. Mary Hospital in Hoboken, said that Christ Hospital will receive $4 million and St. Mary would receive $5 million annually.
“It means we will afford to continue to operate and that it help to pay our debts,” said Quigley.
It was also estimated that the Jersey City Medical Center would receive about $2.7 million annually.