The nation's emergency rooms and hospitals are still, nearly seven years after Sept. 11, not prepared to deal with the "surge" of patients that could be caused by a terror attack, according to a House oversight committee.

What's worse is that it's a situation that could be compounded, hospital officials from both coasts and a state disaster planner said today, if the Bush administration is able to take hundreds of millions in Medicaid funding from public and teaching hospitals.

Rep. Henry Waxman, D-Calif., who chairs the House Committee on Oversight and Government Reform, said the changes the Bush administration is trying to make in the way the government reimburses state and local governments for the services provided by public and teaching hospitals could be "disastrous" to the nation's preparedness for a terror attack and called them an abdication of responsibility.

Waxman's oversight committee conducted a survey of 34 hospitals on March 25 and found that not one was prepared at that moment on that day for a terror attack.

"The situation in Washington, D.C. and Los Angeles was particularly dire. There was no available space in the emergency rooms at the main trauma centers serving Washington, D.C. One emergency room was operating at over 200 percent of capacity: more than half the patients receiving emergency care in the hospital had been diverted to hallways and waiting rooms for treatment. And in Los Angeles, three of the five Level I trauma centers were so overcrowded that they went 'on diversion,' which means they closed their doors to new patients. If a terrorist attack had occurred in Washington, D.C. or Los Angeles on March 25 when we did our survey, the consequences could have been catastrophic. The emergency care systems were stretched to the breaking point and had no capacity to respond to a surge of victims."

Waxman said the federal government, by implementing the new Medicaid regulations, could have a "devastating effect on preparedness" because it will take hundreds of millions in funding from public and teaching hospitals.

Some Republicans on the committee questioned the veracity of the survey prepared by the staff on the committee. Sen. Darrell Issa, R-Calif., called it "amateur."

The Bush administration has directed the Department of Health and Human Services (HHS) to cut Medicaid payments to hospitals by imposing seven new regulations for government payments to states, local governments and public and private hospitals under Medicaid. They say states and local governments and hospitals are getting money not due to them under Medicaid.

Last month, Democrats in the House voted to impose a moratorium on such rule changes. The moratorium faces an uncertain future in the Senate, where Oklahoma Republican Tom Coburn objected to an attempt by Democrats to pass the measure by voice vote because the regulations will help rein in government spending. The Bush administration has the power to enact the changes any time after May 26, when an old moratorium on several of the rules expires.

Rep. Chris Shays, R-Conn., who voted with Democrats for the moratorium, said there still needs to be consideration of the healthcare system as a whole. "Medicaid reimbursement policies may need to change to better support large urban emergency and trauma centers, but those changes alone will never assure adequate surge capacity. We cannot afford to build and maintain idle trauma facilities, waiting for the tragic day, we pray never comes, when they will be needed."

When the committee continues its hearing on Wednesday, Waxman will have tough questions for Homeland Security Secretary Michael Chertoff and HHS Secretary Michael Leavitt, who Waxman said today cannot even provide documentation that they officially considered the effect the Medicaid cuts will have on disaster preparedness.

Today, the Committee heard from Wayne Meredith, the chairman of surgery at Wake Forest's Baptist Medical Center, who said hospitals in his state stand to lose a combined $387 million in federal funding if the new Medicaid regulations are enacted. And those losses would be disproportionately felt by teaching hospitals, like his, which rely on funding from the government to teach new doctors. They also happen to be many of the Level 1 trauma centers on which local disaster plans are built.

"Across the nation, the costs of practicing medicine and delivering trauma care have steadily increased. Meanwhile, the reimbursements to trauma centers and physicians from health plans, managed care, Medicare, Medicaid and safety net programs for the uninsured have steadily decreased and are now gravely threatened by the Medicaid regulations. And somehow, in all of this chaos, our obligation to be prepared for a terrorist blast attack has grown exponentially," Meredith said.

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