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THE WHITE HOUSE
WASHINGTON
April 6, 1998
Dr. Betty A. Lowe
Medical Director
Arkansas Children's Hospital
800 Marshall Street
Little Rock, AR 72202-3591
Dear Betty:
Thank you for your letter about the importance of support for graduate medical education
and about the serious problem our nation's children's hospitals are having keeping up with the
costs of training health professionals. I am aware that direct and indirect private funding used in
the past to support the training mission of children's hospitals is disappearing as a result of rapid
changes in the health care delivery system. I also know that, unlike most teaching hospitals,
children's hospitals do not receive payments from Medicare to help defray the costs of training.
Members of Congress are developing legislation to address the financing of training in
children's hospitals. The Administration will be reviewing these bills as we search for ways to
respond to your concerns. Recently, children's hospital representatives met with Secretary
Shalala and her staff to discuss options in this area, and they will meet shortly with members of
my staff. We are exploring proposals that assure a funding source to help offset the costs of
training health professionals who treat our nation's children.
Thank you again for your letter. Children's hospitals play a critical role in the health of
our children and of our nation, and we must do everything necessary to ensure their continued
vitality.
With best regards, I am
Sincerely yours,
Hillary Hillary Rodham Clinton
d trust you're doing well -
ARKANSAS
HOSPITAL
800 Marshall Street, Little Rock, Arkansas 72202-3591, (501) 320-1100 or TDD (501) 320-1184
Jonathan Bates, M.D.
President and Chief Executive Officer
Betty A. Lowe, M.D.
Medical Director
January 8 1998
Phillip K. Gilmore, M.S., M.H.A.
Chief Operating Officer
Scott Gordon, L.C.S.W.
Director of Community and
The First Lady Hillary Rodham Clinton
Network Services
Interim President ACH Foundation
The White House
Gena Wingfield
Washington, D.C. 20500
Interim Chief Financial Officer
Blanche Moore
Dear Hillary:
Director of Government Relations
Dana Smith
I know that you and the President have heard from the National
Chief Information Officer
Association of Children's Hospitals (N.A.C.H.), as well as hospital
Board of Directors
presidents such as Randall O'Donnell, about our need for federal
Barbara Moore
graduate medical education (GME) support. As a medical educator, I
Chairman
want to emphasize how important this is to Arkansas Children's
John Bale, Jr.
Hospital and other free-standing children's teaching hospitals around the
Vice Chairman
country.
Tom Baxter
Secretary
You understand so well the dramatic changes occurring in the
Harry C. Erwin III
Treasurer
health care. They are posing special challenges to all teaching hospitals,
Terry Yamauchi, M.D.
which increasingly find both private payers and Medicaid unwilling to
Chief of Staff
cover the added costs of resident training. But only free-standing
Robert L. Shults
children's teaching hospitals, like ours, face these challenges without
Past Chairman
significant federal GME support to fall back upon.
Guy Amster Jr.
Jonathan Bates, MD.
Wayne Cranford
Robert G Cress
In 1996, Medicare paid on average over $77,000 in GME
M. Edward Drilling
Debra Fiser. M.D
support for each resident a teaching hospital trained. But it paid an
Barnett Grace
Brett Holiman
average of only $230 per resident trained in free-standing children's
Wanda Hoover
Judge Marion Humphrey
hospitals, because they care for children, who rarely qualify for
Dorsey Jackson
Michael Joshua
Medicare. Comprehensive GME reform is needed for all teaching
Jim Keet
Drake Keith
hospitals, including children's hospitals. But until that happens - which
Richard Leithiser, M.D
Sharon Lewis
many believe will be years away - the teaching mission of children's
Betty A Lowe, M.D.
Diane Mackey
hospitals will be in jeopardy, without interim federal support.
Pat McClelland
Mark Murphy
This is a critical problem, which involves more than just the survival of
Robert D. Nabholz
Netia Olvey
the academic mission of approximately 60 free-standing children
Skip Rutherford
Mark Saviers
teaching hospitals across the country. It involves our future pediatric
Phil Schmidt
Betty Tucker
workforce, since these hospitals train so many of our nation's
Rett Tucker
Harry P. Ward, M.D.
Charles B. Whiteside III
Emeritus
Stauley M. Bauman, Jr.
Hillary Rodham Clinton
Anne Hickman
A major teaching affiliate of the University of Arkansas for Medical Sciences
The First Lady Hillary Rodham Clinton
January 8 1998
Page Two
This is a critical problem, which involves more than just the
survival of the academic mission of approximately 60 free-standing
children teaching hospitals across the country. It involves our future
pediatric workforce, since these hospitals train so many of our nation's
pediatricians and pediatric subspecialists. For example, in Arkansas
approximately 90 percent of practicing pediatricians are trained at
Arkansas Children's Hospital.
It also involves future progress in pediatric medicine. The free-
standing children's teaching hospitals comprise a significant number of
the leading pediatric research centers in the country. Without strong
academic programs, they will be hard pressed to maintain their
commitment to advancements in research and technology, upon which
the nation relies for scientific breakthroughs in children's health.
It is my strong hope that the President will support interim
federal GME funding for free-standing children's teaching hospitals.
N.A.C.H. has had the opportunity to brief Chris Jennings and other on
the White House staff. I know that N.A.C.H. and I also would welcome
the opportunity to brief you and the President personally on this very
important issue.
Thank you for your consideration. My best wishes to you and
your family for 1998.
Sincerely,
Betty A. Lowe, M.D.
Medical Director
Arkansas Children's Hospital
cc: Melanne Verveer, Chief of Staff to the First Lady, The White
House, Washington, D.C. 20500
Carol Rasco, Senior Advisor to the Secretary, Department of
Education, 600 Independence Ave., S.W., Washington, D.C.
20202
THE WHITE HOUSE
WASHINGTON
March 19, 1998
David Weiner
President
Children's Hospital
300 Longwood Ave.
Boston, MA 02115
Dear Mr. Weiner:
Thank you for the letter from you and Dr. Pizzo. I understand and appreciate the gravity
of the problem our nation's children's hospitals are experiencing with the costs of training health
professionals. I am well aware that direct and indirect private funding sources used in the past to
support the training mission of children's hospitals have been diminishing as a result of rapid
changes in the health care delivery system. And, of course, unlike most teaching hospitals,
children's hospitals do not receive payments from Medicare to help defray the costs of training.
I have been advised that there are a number of Members of Congress who are
developing legislation to address the issue of financing the training of providers in children's
hospitals. The Administration will be reviewing these bills as we search for ways to respond to
your concerns. Recently, children's hospital representatives met with Secretary Shalala and her
staff to discuss options in this area and they will shortly meet with members of my staff. We are
exploring proposals such as yours that assure a funding source to help offset the costs of training
health professionals who treat our nation's children. I look forward to working with you to solve
this pressing problem together.
Again, thank you for your letter. Children's hospitals play a critical role in the health of
our children and the health of our nation, and we must ensure their continued vitality into the
future. I have always appreciated your advice and counsel and I look forward to continuing our
productive working relationship on behalf of children.
With best regards, I am
Sincerely yours,
Hillary Hillary Rodham Rodham Clinton Clinton
300 Longwood Wenne
Boston. MA 02115
Phone: 617-355 8555
Fax.617-739-3515
David S. Weiner
President
Children's Hospital
February 11, 1998
Mrs. Hillary Rodham Clinton
The White House
Washington, D.C. 20500
Dear Mrs. Clinton:
We are writing to ask your help and the Administration's leadership on an
issue that is critically important to the future of our nation's children's hospitals.
Increasingly, we have little to no funding sources for Graduate Medical
Education (GME). This presents a substantial problem not only for our
hospital, but also for pediatric medical education.
About 60 children's hospitals nationwide are freestanding. Because we see
few Medicare patients, we receive virtually no Medicare GME--the only
significant source of GME funding in today's market. Yet children's hospitals
train 25 percent of all pediatricians and the great majority of pediatric
specialists, although they make up less than one percent of all U.S. hospitals.
The rapid growth of market competition is making it increasingly difficult for
teaching hospitals to fulfill their teaching missions while maintaining their
competitive financial viability. This problem is especially severe for children's
hospitals such as ours because of our payor mix. As a pediatric hospital with
few Medicare patients, we receive virtually no Medicare GME payments. As
the market moves to managed care, private payers are refusing to pay for the
costs of GME, leaving Medicare as the only reliable GME payor. Teaching
hospitals, on average, receive $77,000 per resident per year through
Medicare. Children's Hospital, Boston receives approximately $600. If we
were to receive the national reimbursement for each of our 250 full-time
equivalent resident positions, the support for GME would be approximately
$19 million. Without that support, the hospital would experience a severe
financial strain. This issue, therefore, has enormous implications for our
continued financial viability, even in the near term.
Mrs. Hillary Rodham Clinton
Page 2
November 26, 1997
We are facing a considerable dilemma. Our academic mission is interrelated
with our level of excellence in patient care and research. Our financial health
is essential to our ability to care for low-income children and often to serve as
the only resource for certain critical and specialized services. To solve this
dilemma, we must find a solution for funding GME.
For the past few years, we hoped that a solution for funding GME would be
possible through some broader-based financing mechanism. Now, with the
Bipartisan Commission on the Future of Medicare and MedPAC tasked with
reviewing such reform, a children's hospital solution under overall GME reform
appears unlikely in the near future. That is why Children's Hospital of Boston
is joining with the National Association of Children's Hospitals (NACH) in
asking that the Administration include some short-term, capped source of
federal funds for GME for freestanding children's hospitals in its fiscal 1999
budget.
We have supported the Clinton Administration in its efforts to advance the
health of children. In addition, we know that you, in particular, understand and
appreciate the contribution that children's hospitals make to the health of all of
our children. As both the center of excellence and safety net provider for the
children we serve, we train health professionals and provide breakthroughs in
science, treatment, and technology for all children.
The Administration's leadership on children's hospital GME can make a
substantial difference to our future.
Very truly yours,
Hase
David S. Weiner
Philip A. Pizzo, M.D.
President
Physician-in-Chief
Chair, Department of Medicine
some additional backyound from HHS
Graduate Medical Education in Freestanding Children's Hospitals
Issue, Medicare makes payments to hospitals for graduate medical education (GME) based on
the hospital's Medicare utilization. Since freestanding children's hospitals treat few Medicare
patients, they do not receive significant support from Medicare for physician training.
Commission. The Balanced Budget Act of 1997 (BBA) directed the National Bipartisan
Commission on the Future of Medicare to make recommendations related to financing graduate
medical education including consideration of hospitals, such as children's hospitals, that are not
currently eligible for GME support.
National Association of Children's Hospitals (NACH) Proposal. NACH seeks an interim
solution, until Congress responds to the Bipartisan Commission's recommendations, of a capped,
time-limited fund, financed out of general revenues, to provide support for GME in children's
hospitals.
Meeting with Secretary Shalala. CEO's of four children's hospitals met with Secretary Shalala on
March 4th. Secretary Shalala expressed great concern for the financing dilemma faced by
children's hospitals with regard to how to finance physician training. She recounted efforts
of this Administration to secure legislation to provide such funding. The President's
health care reform legislation of 1994 sought such funding, and last year, the Secretary appointed
a Departmental workgroup to address the issue. Despite these efforts, we have not found
a solution. The Secretary expressed the Administration's determination to continue to
seek a solution and noted that the Department would provide technical assistance to
Congress should legislative proposals be developed.
and ongwood
Boston. MA0213
Phone of
David S. Weiner
President
Children's Hospital
February 11, 1998
Mrs. Hillary Rodham Clinton
The White House
Washington, D.C. 20500
Dear Mrs. Clinton:
We are writing to ask your help and the Administration's leadership on an
issue that is critically important to the future of our nation's children's hospitals.
Increasingly, we have little to no funding sources for Graduate Medical
Education (GME). This presents a substantial problem not only for our
hospital, but also for pediatric medical education.
About 60 children's hospitals nationwide are freestanding. Because we see
few Medicare patients, we receive virtually no Medicare GME--the only
significant source of GME funding in today's market. Yet children's hospitals
train 25 percent of all pediatricians and the great majority of pediatric
specialists, although they make up less than one percent of all U.S. hospitals.
The rapid growth of market competition is making it increasingly difficult for
teaching hospitals to fulfill their teaching missions while maintaining their
competitive financial viability. This problem is especially severe for children's
hospitals such as ours because of our payor mix. As a pediatric hospital with
few Medicare patients, we receive virtually no Medicare GME payments. As
the market moves to managed care, private payers are refusing to pay for the
costs of GME, leaving Medicare as the only reliable GME payor. Teaching
hospitals, on average, receive $77,000 per resident per year through
Medicare. Children's Hospital, Boston receives approximately $600. If we
were to receive the national reimbursement for each of our 250 full-time
equivalent resident positions, the support for GME would be approximately
$19 million. Without that support, the hospital would experience a severe
financial strain. This issue, therefore, has enormous implications for our
continued financial viability, even in the near term.
Mrs. Hillary Rodham Clinton
Page 2
November 26, 1997
We are facing a considerable dilemma. Our academic mission is interrelated
with our level of excellence in patient care and research. Our financial health
is essential to our ability to care for low-income children and often to serve as
the only resource for certain critical and specialized services. To solve this
dilemma, we must find a solution for funding GME.
For the past few years, we hoped that a solution for funding GME would be
possible through some broader-based financing mechanism. Now, with the
Bipartisan Commission on the Future of Medicare and MedPAC tasked with
reviewing such reform, a children's hospital solution under overall GME reform
appears unlikely in the near future. That is why Children's Hospital of Boston
is joining with the National Association of Children's Hospitals (NACH) in
asking that the Administration include some short-term, capped source of
federal funds for GME for freestanding children's hospitals in its fiscal 1999
budget.
We have supported the Clinton Administration in its efforts to advance the
health of children. In addition, we know that you, in particular, understand and
appreciate the contribution that children's hospitals make to the health of all of
our children. As both the center of excellence and safety net provider for the
children we serve, we train health professionals and provide breakthroughs in
science, treatment, and technology for all children.
The Administration's leadership on children's hospital GME can make a
substantial difference to our future.
Very truly yours,
Mard
David S. Weiner
Philip A. Pizzo, M.D.
President
Physician-in-Chief
Chair, Department of Medicine
some additional backyound from HHS
Graduate Medical Education in Freestanding Children's Hospitals
Issue. Medicare makes payments to hospitals for graduate medical education (GME) based on
the hospital's Medicare utilization. Since freestanding children's hospitals treat few Medicare
patients, they do not receive significant support from Medicare for physician training.
Commission. The Balanced Budget Act of 1997 (BBA) directed the National Bipartisan
Commission on the Future of Medicare to make recommendations related to financing graduate
medical education including consideration of hospitals, such as children's hospitals, that are not
currently eligible for GME support.
National Association of Children's Hospitals (NACH) Proposal. NACH seeks an interim
solution, until Congress responds to the Bipartisan Commission's recommendations, of a capped,
time-limited fund, financed out of general revenues, to provide support for GME in children's
hospitals.
Meeting with Secretary Shalala. CEO's of four children's hospitals met with Secretary Shalala on
March 4th. Secretary Shalala expressed great concern for the financing dilemma faced by
children's hospitals with regard to how to finance physician training. She recounted efforts
of this Administration to secure legislation to provide such funding. The President's
health care reform legislation of 1994 sought such funding, and last year, the Secretary appointed
a Departmental workgroup to address the issue. Despite these efforts, we have not found
a solution. The Secretary expressed the Administration's determination to continue to
seek a solution and noted that the Department would provide technical assistance to
Congress should legislative proposals be developed.