A “certified country crock,” that’s how some top House Republicans are labeling New York Presbyterian Hospital, situated amidst Manhattan’s skyscrapers, for being labeled a “rural” medical facility.
Jason Smith, the Chairman of the House Ways and Means Committee, voiced his concerns on Sunday, suggesting this classification is a symptom of why health care costs are spiraling out of control in the U.S.
Smith mentioned that he had recently convened a meeting with several prominent hospital CEOs to tackle the issue of rising health costs facing Americans. “It’s a system rife with abuses,” he said on WABC’s “Cats Roundtable.”
He didn’t hold back when addressing the hospital’s CEO, Brian Donley, about the “rural” designation, positing that it was a tactic to secure special benefits intended for rural hospitals.
“How can a flagship Manhattan hospital, right off 68th Street, be considered rural? I can’t recall seeing farms in Manhattan,” he remarked during his conversation with John Catsimatidis. “Clearly, there’s a loophole allowing this.”
Smith pointed out that it’s not just New York Presbyterian; 425 hospitals have also received local funding over the past six years—a troubling trend that needs to be addressed.
The Ways and Means Committee commented, stating that this situation illustrates the difficulties faced by rural Americans in accessing health care, especially when funds meant for rural hospitals are diverted to urban facilities.
Defending the hospital’s designation, Donley pointed to the 8,000 patient referrals New York Presbyterian receives annually from local hospitals. “We take pride in caring for these patients,” he noted during his testimony.
The hospital’s statement highlighted that, according to the Centers for Medicare and Medicaid Services, they qualify as a rural referral center, enabling them to deliver complex care to rural communities. They treat patients from all over the country, in fact.
This isn’t the first time New York Presbyterian has come under scrutiny; the Justice Department has filed an antitrust lawsuit against the hospital system, accusing them of engaging in unlawful contracts with insurance providers that hinder cheaper health plan offerings.
New York Presbyterian has firmly stated that the lawsuit lacks merit.
Smith expressed his worries regarding the growing consolidation in health care, which he believes fosters monopolistic behavior, particularly as hospitals acquire physician practices. “They often end up receiving higher reimbursement rates than individual physicians,” he remarked.
He shared a troubling anecdote, citing a Florida hospital charging $13,000 for an emergency CT scan, whereas the same procedure cost just $79 during a follow-up visit in a doctor’s office.
In a broader sense, Smith described the health care system as “broken,” attributing the issues to the undue influence of hospitals, insurance companies, pharmaceutical firms, and medical device manufacturers through persistent lobbying in Congress.
“A lot of people are hesitant to confront these problems head-on and rectify them,” he said. “Too many interests are at play, each trying to safeguard their own benefits, leading to a sense of nervousness when someone challenges the status quo.”
He concluded with a call to action, stating, “This Titanic needs to start moving, or the outcome won’t be favorable.”
