US hospitals "do not need Medicare pay rise"

There is "no compelling reason " for the US Congress to give hospitalsincreased Medicare payments, says a report by the Medicare Payment Advisory Commission, given that hospitals' profit margins "appear to have improved substantially in 2000."

The report is welcomed by groups including the American Association of Retired Persons, according to a report in the New York Times, which quotes Tricia Smith of the AARP as saying that enough of the budget surplus has been dedicated to health care providers, and that "we now need to focus on prescription drugs and the concerns of beneficiaries."

However, the hospitals disagree. Thomas Nickels, senior vice president of the American Hospital Association, said more than one-third of hospitals are losing money on Medicare, and Kenneth Raske, president of the Greater New York Hospital Association, claimed that the Commission's analysis "inherently overstates the profitability of teaching hospitals," reports the WSJ.