Biden announces White House deal with hospitals

WASHINGTON -- The nation's hospitals agreed Wednesday to forgo $155 billion in government health-care reimbursements over the next 10 years, savings the White House says will go toward paying for an overhaul of the nation's ailing health care system.

The savings, added to $80 billion promised by drug companies last month, are aimed at helping to keep the cost of a new health care plan under $1 trillion. The deal is also contingent on President Obama signing health care legislation.

Vice President Biden, who announced the deal, said it "produces real savings in federal health care spending" that will go toward Obama's "firm goal" of enacting health care legislation that does not add to the deficit.

Congress continued work on legislation to cut costs and provide health insurance to the 46 million without it, but the agreement from hospitals was met with skepticism:

•Dennis Smith, a health care expert at the conservative Heritage Foundation, said hospitals will end up making money from a health care overhaul that costs the government $1 trillion. "These savings are really a mirage," he said. If Obama's plan is enacted, "hospitals are likely to get more revenue than what they are pretending to give up."

• House Republican leader John Boehner, R-Ohio, said the deal with hospitals would lead to higher costs and lower-quality care for patients.

"Administration and congressional Democrats are literally bullying health care groups into cutting backroom deals to fund a government takeover of health care," he said. "That will increase costs and force millions of Americans out of the health care that they currently have."

• Public and children's hospitals praised the overall savings plan but expressed concern that reduced government payments could hurt hospitals that serve a high percentage of poor people. Some of the reductions "could severely damage safety-net providers if not carefully crafted," the National Association of Children's Hospitals and the National Association of Public Hospitals and Health Systems said in a joint statement.