Tuesday, the Centers for Medicare & Medicaid Services announced changes to the Inpatient Prospective Payment System proposed rule that provides relief from the increasing disproportion of reimbursement to hospitals created by the Medicare wage index.
U.S. Sen. Richard Shelby’s office said that while CMS uses wage index data based on regional labor costs to determine Medicare reimbursement levels for hospitals in a particular area, many hospitals – particularly in Alabama – have been negatively affected as a result of flawed data.
“The Medicare Wage Index has negatively affected Alabama hospitals for over 20 years,” Shelby said. “After two decades of working to address a problem that significantly contributes to heightened hospital closures throughout our state, I am glad to see Administrator Verma and CMS taking steps to solve this dire issue. I look forward to continuing my work with the agency to make sure that this sort of careless imbalance is eliminated moving forward.”
According to Shelby, in November 2018, the Office of Inspector General for the Department of Health and Human Services issued a report that outlined concerns with the current wage index calculations, including incorrect or incomplete wage data, insufficient reviews of information and the inaccuracy of rural floor and hold-harmless provisions. With the lowest wage index in the country, Alabama’s urban and rural hospitals have suffered from lower reimbursement levels, while hospitals in heavily populated states have taken advantage of overpayments illustrated in the report.
Last month, Shelby sent a letter signed by the entire Alabama Congressional delegation to CMS Administrator Seema Verma encouraging the agency to provide Alabama hospitals relief from the Medicare wage index through the use of its rule-making process authority. Prior to the letter, Shelby participated in many calls, meetings and discussions with Verma and other CMS officials to encourage the proposed adjustment.
Under the old rules, Alabama has the lowest wage index. According to the Alabama Hospital Association, approximately 88 percent of Alabama hospitals are currently operating in the red and cannot cover the cost of delivering care. Thirteen hospitals in Alabama have closed their doors since 2011, seven of which were in rural areas.
U.S. Sen. Doug Jones applauded the Centers for Medicare and Medicaid Services for a move that could provide badly needed relief for Alabama hospitals.
“As I have traveled across Alabama meeting with health care leaders in both rural and urban communities, I have heard two refrains consistently: fix the Medicare Wage Index formula and expand Medicaid,” Jones said. “The decision by CMS to propose a new reimbursement formula is welcome news and a great first step for the health care providers across our state who have struggled for years with an inexplicably low reimbursement rate. These hospitals provide care to all Alabamians, regardless of their insurance status, and they have to absorb the costs when that care isn’t reimbursed. That puts the entire system on slippery financial footing and can hurt the broader community if a hospital is forced to close its doors.”
“After meeting with Administrator Verma, Sen. Shelby and Congresswoman (Terri) Sewell last September about this issue, I was very hopeful about the prospects of getting this long-overdue change made,” Jones said. “I look forward to continuing to work with CMS to make sure that its final rule reflects what is in the best interests of Alabama, as well as advocating for Alabama to take the next step by finally expanding Medicaid.”
“For nearly three decades, Alabama hospitals have been facing declining Medicare reimbursement due to a fundamentally flawed reimbursement system known as the Medicare Wage Index,” said Congressman Bradley Byrne, R-Montrose. “This system has put an incredible strain on Alabama hospitals and has been a leading contributor to the string of rural Alabama hospital closures over the last decade. Immediately after President (Donald) Trump was took office, I began working with his Administration and CMS Administrator Seema Verma to address these disparities. I’m proud to have played a part in making today’s announcement possible because it is a major step in the right direction to help save our rural hospitals.”
“Since coming to Congress, I have worked with my colleagues in the Alabama delegation, Alabama’s hospitals and the Alabama Hospital Association to address disparities in the area wage index formula and increase Medicare reimbursements for Alabama’s hospitals,” said Congresswoman Terri A. Sewell (D-Selma). “I have been proud to introduce the Fair Medicare Hospital Payments Act during the past two Congresses, which would address disparities in the area wage index.”
“Last Congress, Sens. Richard Shelby and Doug Jones and I called CMS Administrator Seema Verma into our offices to hear from us on the ever-growing challenges our medical providers, especially Alabama’s rural hospitals, are facing due to low reimbursement rates,” Sewell said. “Today’s proposed change to ensure Alabama hospitals receive their fair share in Medicare reimbursement dollars is proof positive that CMS heard us loud and clear. Increasing the Medicare wage index for struggling hospitals in low-income states like Alabama will help our hospitals provide critical care and keep their doors open, especially in rural parts of our state.”
“I am eager to work with Members of Congress from Alabama and similarly situated states to ensure that CMS’s proposal is finalized,” Sewell said. “While this proposed change is a good first step, there is still work to be done to support our hospitals so they can meet all of our communities’ health care needs.”
“Last month, I joined the entire Alabama congressional delegation in signing Senator Richard Shelby’s letter to CMS Administrator Verma encouraging the agency to provide Alabama hospitals relief from the Medicare Wage Index,” said Congresswoman Martha Roby, R-Montgomery. “The Medicare Wage Index has negatively impacted our Alabama hospitals for many years, and I am so glad to finally see CMS taking steps to resolve this serious problem by proposing an adjustment. I appreciate Sen. Shelby’s leadership on this important issue.”
Byrne’s office said he secured the Request for Information that CMS used as the basis for the reforms implemented in this rule.
Former State Sen. David Burkette pleads guilty, avoids jail
Former State Sen. David Burkette will avoid jail time and be sentenced to a 30-day suspended sentence as part of a plea deal reached on Monday.
Burkette, who pleaded guilty to one count of violating the Fair Campaign Practices Act, will also have to pay a $3,000 fine and serve 12 months of probation as part of the deal. He was sentenced in Montgomery Circuit Court on Monday after being charged two weeks ago with failing to deposit more than $3,600 in contributions into campaign accounts — a misdemeanor.
He also resigned his seat in the Alabama Senate as part of the plea deal.
“I’m just happy to still be here,” Burkette told the court following his sentencing, according to multiple media reports.
The former senator suffered a stroke in 2018 and has been confined to a wheelchair since. His current health status played a role in his sentence considerations.
The charges against Burkette stem from a series of complaints filed against him with the Alabama Ethics Commission — all of them related to various issues during his time on the Montgomery City Council. The charge for which he pleaded guilty occurred in 2015.
The Ethics Commission referred numerous charges to the Alabama attorney general’s office, according to sources familiar with the investigation of Burkette, but the attorney general’s office elected to charge Burkette with only the misdemeanor as part of the deal that saw him resign.
“Candidates for public office at the state, county and municipal levels must comply with the State’s Fair Campaign Practices Act,” said Attorney General Steve Marshall. “Personally profiting from campaign funds erodes public confidence in the system and will not be tolerated.”
Former state senator arrested on charges of violating campaign finance laws
David Burkette has been officially arrested. The former state senator from Montgomery, who resigned on Tuesday as part of a plea deal with the Alabama Attorney General’s Office, was formally charged on Thursday with a single misdemeanor count of violating the Fair Campaign Practices Act.
According to a press release from the AG’s office, Burkette’s charge stems from him depositing campaign donations into his personal account instead of into his campaign accounts, as required by the FCPA. The alleged crimes occurred in 2015 and 2016 when Burkette was serving on the Montgomery City Council.
“The complaint alleged that, in 2015 and 2016 while running for the Montgomery City Council, Burkette intentionally failed to deposit $3,625.00 in campaign contributions into his campaign checking account, and instead, deposited or cashed those contributions into or against his personal bank account,” the AG’s release stated.
The single misdemeanor charge is surprising given the lengthy list of allegations against Burkette submitted to the Alabama Ethics Commission. APR obtained a copy of the original report, which was submitted in October 2018.
In addition to more than $40,000 in allegedly improperly spent council discretionary funds that were flagged by auditors for the city of Montgomery, Burkette was also accused of inappropriately donating tens of thousands more to suspect charities and two sororities, including his wife’s.
The Ethics Commission referred Burkette’s case to the AG’s Office in October 2019.
Pro-Growth Conference kicks off with Doug Jones, discussions on COVID impact and a living wage
What happens if you just give impoverished citizens $500 per month — no strings attached? Good things, it turns out. The people use that income to buy food, medicine and basic necessities for life. They take a day off work if they’re sick and actually get treatment. They quit a second, hourly-wage job that they are overqualified for and instead work towards obtaining a better, higher-paying primary job.
These are things that the city of Stockton, California, has learned in its year-long living wage program.
The program, while limited in size — only 125 people — has proven to be a larger success than city officials had hoped, and it has opened their eyes to a new, more proactive style of governance, Stockton Mayor Michael Tubbs told Alabama elected officials.
Tubbs was the featured speaker on Tuesday at the first day of the Pro-Growth Policy Conference, a three-day forum for Alabama elected leaders with guest speakers from around the country offering tips and best practices.
The first day of the conference began with an opening talk from Sen. Doug Jones, who pressed the need for Medicaid expansion and how expansion has aided other red states. Jones also highlighted the need for broadband expansion and talked about a bill he has in the Senate that would create a broadband main office and dish out about $20 million in money for affordable access.
“Now (with COVID), we know how needed it really is,” Jones said. “We see the homework gap that we have. We know there’s a need for more telemedicine. My bill would consolidate in one office all of the monies for broadband … and provide affordable access.”
Jones said the current COVID pandemic has highlighted just how badly we need better access to broadband in Alabama, and a major area of concern right now is healthcare.
Highlighting that point, Brandon Garrett, the chief operating officer of the National Minority Quality Forum, and Dr. LaTasha Lee, the vice-president of social and clinical research, demonstrated the many ways in which inequality in health care and health care options is harming impoverished communities.
A number of factors play into that inequality, but a lack of access to updated means of communication and tools is one of the biggest.
“(Dr. Martin Luther King Jr.) said that, ‘Of all the forms of inequality, injustice in health care is the most shocking and inhumane because it results in physical death,’” Lee said. “That’s what we’re seeing currently with COVID-19 and sickle cell disease. These two diseases are affecting the minority community and causing death, and they make a great argument that such health care disparities really are a social justice issue.”
Correcting such issues was one of the goals of Stockton’s living wage experiment. Now, Tubbs said, a working person can afford to stay home or get tested if they’re feeling symptomatic, whereas before that person — scared of missing a paycheck or losing the job altogether — might come to work with the virus and infect an entire workplace.
That alone, Tubbs said, has restored dignity to a number of residents.
“This is not easy, especially with budgets the way they are,” Tubbs said. “But I don’t know how we continue to live with the status quo as it is.
“I think part of being a leader, as we are, is having the courage to do something about what we’re seeing. We have to be able to do that.”
The Pro-Growth Policy Conference will run both Wednesday and Thursday, 10 a.m. until 2 p.m. Wednesday’s round of conferences will focus on state grants, economic development around the state and what the 2021 legislative session might look like.
On Thursday, the event will wrap up with talks by the Equal Justice Initiative’s Bryan Stevenson and Alabama Congresswoman Terri Sewell.
Russell Bedsole wins Republican runoff in HD49
As of press time, it appears that Russell Bedsole has won a narrow victory over Mimi Penhale in the special Republican primary runoff election in Alabama House District 49.
At press time, Bedsole had a 166-vote lead in unofficial results on the secretary of state’s website.
“We won,” Bedsole declared on social media.
Bedsole is an Alabaster city councilman and a Shelby County Sheriff’s Department captain.
“Sadly, tonight did not turn out in my favor. Despite the loss, I feel like God truly used this opportunity to help me grow in my walk with Him, and gave me the opportunity to increase my testimony,” Penhale said. “I feel so incredibly blessed by the people I have met on this campaign and the experiences I have had. I am disappointed in the outcome, but what an honor it is to have the confidence of 1,183 people across House District 49! Thank you!!”
Russell Bedsole had 1,249 votes, or 51.36 percent, to Mimi Penhale’s 1,183, or 48.64 percent, to win the House District 49 Republican primary runoff.
There were just 2,432 votes cast in the special primary runoff election. Shelby County was the decisive factor in the election. Bedsole won Shelby County with 762 votes, or 71.42 percent, to Penale’s 305 votes.
Penhale carried Chilton and Bibb Counties, but could not overcome Bedsole’s strong performance in Shelby County.
The provisional ballots will be counted on Sept. 8, 2020, and certification of votes will occur on Sept. 16, 2020.
Bedsole will face Democratic nominee Sheryl Patton in the special general election on Tuesday, Nov. 17, 2020.
The vacancy in House District 49 was created when State Rep. April Weaver announced her resignation to accept a presidential appointment as a regional director in the Department of Health and Human Services.
In a statement, the Alabama Republican Party thanked “each of the candidates that qualified for offering themselves up for service in the Alabama State House of Representatives.”