Voluntary Hospital Cost Containment Act

(Reported to House from the Committee on Interstate and Foreign Commerce with amendment, H. Rept. 95-1789 (Part I))

Voluntary Hospital Cost Containment Act - =Title I: Voluntary Hospital Cost Containment Program; National Commission on Hospital Costs; Federal Support of Approved State Hospital Cost-Containment Programs; Miscellaneous Cost Constraint Provisions= - States that the purposes of the program established by this Title are: (1) to establish voluntary goals for restraining hospital cost increases; (2) to establish a system of reporting on hospitals' expenses (3) to establish a National Commission on Hospital Costs; (4) to provide for the orderly development of State cost containment programs for hospitals; and (5) to provide additional cost constraint provisions relating to Medicare, Medicaid, and other programs.

Specifies that the goal of the voluntary hospital cost containment program is to reduce the rate of increases in total hospital expenses occurring in 1977 by: (1) two percentage points for calendar year 1978; and (2) four percentage points for calendar year 1979, and for each subsequent calendar year, adjusted in each case by the change in the rate of increase in the Gross National Product (GNP) from the rate of increase in the GNP for 1977.

Requires each Medicare hospital to provide the Secretary of Health, Education, and Welfare with data on each hospital's total expenses needed to compute and monitor compliance with the goals of the voluntary program.

Requires the Secretary to compile data received on hospital expenses and to report such data at least quarterly to the appropriate committees of Congress and to the National Commission on Hospital Costs.

Establishes a National Commission on Hospital Costs to receive and evaluate the compiled data on hospital expenses, and to compare such data to the goals of the voluntary program.

Requires the Commission to: (1) make any recommendations regarding hospital cost containment it deems appropriate; (2) make recommendations regarding an improved system of classification of hospitals; (3) submit recommendations on alternative systems of financing health care services and the methods for paying hospitals for such services; and (4) develop an economic index that accurately reflects the prices of items that constitute hospitals' costs and which can be used to assess the effects of inflation.

Authorizes the Secretary to provide Federal support for approved State hospital cost containment programs. Sets forth the requirements which a State program must follow in order to be eligible for funding, including the requirement that every hospital submit semiannually to the appropriate health systems agency, its average semiprivate room rates and the rates charged for each of the 30 other frequently used hospital services.

Stipulates that where the Secretary has determined that a program has not substantially complied with such requirements, he shall notify the State of its failure to comply and provide the State with appropriate technical assistance in order to assist the State in complying with the requirement.

Amends the Social Security Act to allow any hospital to enter into an agreement with the Secretary under which its inpatient hospital facilities may be used for the furnishing of services which, if furnished by a skilled nursing facility, would constitute post-hospital extended care services.

Stipulates that payment to any hospital for post-hospital extended care services furnished under such an agreement shall be based on the reasonable cost of the services.

Prohibits the Secretary from entering into such an agreement with a hospital unless: (1) for a specified period the hospital has had an average daily occupancy rate of less than 80 percent; (2) the hospital is located in a rural area and has less than 50 beds; and (3) the hospital has been granted a certificate of need for the provision of long-term care services.

Requires the Secretary to submit to Congress, within three years after the date of enactment of this Act, a report evaluating the program of post-hospital extended care services established by this Act.

Stipulates that payment under an approved State plan may be made for skilled nursing facility services and intermediate care facility services furnished by a hospital which has in effect an agreement under the post-hospital extended care services program.

Stipulates that if an entity provides services reimbursable on a cost-related basis, the Secretary shall require, as a condition of payment with respect to administrative costs incurred in the performance of audits, that such audits be coordinated through common audit procedures.

Requires the Secretary to review State and all Federal regulations which affect hospital facilities and operations with respect to their cost-impact, and to report to Congress and to the States, as appropriate, on such review and on such changes in legislation as deemed appropriate.

=Title II: Limitation on Capital Expenditures= - Amends the Public Health Services Act to require the Secretary to promulgate an annual hospital capital expenditure limit. Specifies that the sum promulgated as a limit be an amount which may not exceed $4,000,000,000, or such greater amount as the Secretary shall annually establish to reflect increases in the cost of construction.

Amends the Social Security Act to stipulate that payment to the States unless Medicaid will not be made with respect to any amount which is attributable to expenses related to hospital capital expenditures: (1) that are not found to be needed under a certificate of need program; and (2) the obligation of which has resulted in a hospital capital expenditure limit being exceeded.

Amends the Public Health Service Act to specify new functions for the State Health Planning and Development Agency with regard to certificate of need programs. Specifies new requirements for the certificate of need program.

Stipulates that a State Agency shall be given the opportunity to review and comment on the proposed use of Federal funds within the State by the Public Health Service for the development, or changing, institutional health services.

=Title III: Program to Assist and Encourage the Discontinuance of Unneeded Hospital Services= - Directs the Secretary to establish a program to provide financial assistance and encouragement during the three fiscal years beginning October 1, 1979, for the consolidation of duplicative hospital services and the discontinuance of unneeded hospital services.

Stipulates that a hospital which intends to: (1) discontinue providing inpatient health services; (2) discontinue an identifiable unit of the hospital which provides inpatient health services; or (3) convert a part of the hospital into providing ambulatory care services or long term care services, may apply for debt payments, incentive payments, or conversion payments, as specified in this Act.

Requires a hospital, in order to receive such payment, to submit an application to the Secretary in such form and manner as the Secretary may prescribe.

Sets forth the formulas for the computation of the amount of a debt payment, incentive payment, or conversion payment.

Amends the Public Health Services Act to authorize the Secretary to make grants to any school of medicine to meet the costs of projects to establish and operate programs which provide training in the techniques of reducing the cost of delivering health care.