| Congressional Budget Office Releases Revised Physician Payment Options |
CBO questions validity of decreasing future payment rates
By Marcelino Oliva, DO, FACOFP and Ray Quintero
A report released by the Congressional Budget Office (CBO) September 6, 2006 included three options for Congress to consider as ways to reverse the proposed 5.1 percent physician payment cuts. In the report, CBO questioned the validity of decreasing future payment rates to recoup for past spending exceeding the Sustainable Growth Rate (SGR) target. Each of the three proposed options would increase payments for physician services, which in turn, would increase beneficiary Part B premiums.
Stabenow Introduces Legislation
to Replace SGR
Sen. Debbie Stabenow (D-MI) introduced the “Fix and Improve Reimbursement (FAIR) for Physicians Act of 2006” (S. 3888) on September 12. The bill addresses replacing the severely flawed Medicare physician payment formula, the Sustainable Growth Rate (SGR). The bill would sunset the SGR formula on January 1, 2009. In the meantime, a physician-heavy commission would be developed. S. 3888 mandates the commission’s membership be a majority of physicians or other health professionals. The “Physician Payment Update Commission” would be charged with developing a new formula that would replace the SGR formula.
S. 3888 finds that adopting the Medicare Payment Advisory Commission (MedPAC) recommendation to update payments for physicians’ services in 2007 and 2008 would allow physicians to continue providing high access to quality Medicare services, and would provide Congress with the time to develop an alternative payment system. The bill is consistent with the ACOFP’s priorities of replacing the SGR with a formula that provides positive payment updates to physicians while also addressing the impending 5.1 percent proposed cut for 2007.
Johnson/Cardin Physician Payment Letter Garners 265 Signatures
Also on September 12, 265 Members of the U.S. House of Representatives sent a letter to House Speaker Dennis Hastert (R-IL) and Democratic Leader Nancy Pelosi (D-CA) urging the house to take action to prevent scheduled cuts in Medicare physician payments from being realized. The letter was drafted and circulated by Reps. Nancy Johnson (R-CT) and Benjamin Cardin (D-MD). One hundred thirty-four Republicans, 130 Democrats and one Independent signed the letter. The letter is similar to the letter circulated in the Senate earlier this year by Sen. John Kyl (R-AZ) and Sen. Debbie Stabenow (D-MI), which secured the support of 80 Senators. In total, 345 Members of Congress (80 percent) have gone on record expressing support for immediate action on the Medicare physician payment issue.
ACOFP Supports “Health Care
Access to Rural Equity Act”
Rep. Earl Pomeroy (D-ND) and Rep. Greg Walden (R-OR) were joined by members of the House Rural Health Care Coalition at a morning press conference on September 7. The press conference was held to introduce the “Health Care Access to Rural Equity Act” (H-CARE) (H.R. 6030). The bill has 60 original
co-sponsors.
The co-sponsors and members of the House Rural Health Care Coalition aim to help rural health care providers address payment and other challenges associated with providing high quality health care. Neither Rep. Pomeroy nor Rep. Walden were certain as to when and how the provisions of the bill would be addressed; however, both were optimistic that progress would and must be made during the current Congress. The ACOFP has historically supported the provisions aimed at increasing reimbursements for physicians practicing in rural areas.
ACOFP Participates in Lobbying Efforts
The ACOFP conducted it’s first ever “Virtual Lobby Week” focusing on the physician payment issue in early September. Members were tasked with a different “action a day to keep the cuts away.” Osteopathic advocates contacted Congress and the White House more than 1,200 times via phone and e-mail. We must make sure our voice is heard in the halls of Congress by continuing to call, write, and fax your Senators and Representatives. Keep an eye out for the next call to action on the Medicare physician payment cuts.
Meanwhile, the ACOFP participated in a mini “DO Day on Capitol Hill” September 12 focusing specifically on physician payment. Leaders were invited to participate in this advocacy initiative as part of the ACOFP’s efforts to stop the 5.1 percent Medicare cut for 2007. Members of the ACOFP attended a briefing conducted in conjunction with leaders from the American Osteopathic Association (AOA), American Academy of Family Physicians (AAFP) and the American College of Physicians (ACP) before venturing out to meet with Members of Congress and their staff. Twenty-two osteopathic physicians participated in this event, and they met with more than 70 Members of Congress.
Bill Would Reduce Number
of Uninsured Americans
The “Health Partnership through Creative Federalism Act” (H.R. 5864), introduced by Rep. Tammy Baldwin (D-WI), aims to reduce the number of uninsured Americans and to expand healthcare to all in need. The bill will provide grant funding to states to carry out a broad range of strategies and programs to reduce the number of uninsured.
These approaches can include everything from tax credits to expansion of the State Children’s Health Insurance Program (SCHIP). All states receiving these grants would be required to report to Congress on their progress at the end of a five-year period. The bill will ultimately provide for best practices by empowering states to develop innovative ways in which to improve coverage and access. These programs are intended to increase access to care in urban, suburban, rural, and frontier areas with underserved populations.
Eligibility for the State Health Expansion and Improvement Grant (SHEIG) is open to states, regions within states, or regions that cross state borders. Applications will be submitted to a bipartisan commission. States will commit to specific percentage reductions of uninsured and must report progress to the commission annually. In addition to reducing uninsured, each state should seek to improve quality, efficiency, and the use of information technology. Potential approaches to reduce uninsured include tax credits; expansion of Medicaid; expansion of SCHIP; creating purchasing pools; single pool or single payer systems; health savings accounts; and/or a combination of options.
The entire slate of funded state programs shall be budget neutral. However, some state programs may have a net federal cost while others will save the federal government money. Some programs may require a large investment initially, but will save money over the five-year grant period.
Hearing Focuses on Competition
in Group Health Care
The Senate Judiciary Committee held a hearing on “Competition in Group Health Care” on September 6. The hearing focused on antitrust regulations that prevent providers from directly negotiating with group insurers. Members of the committee expressed concern that consolidation of insurers was merely raising their profits and not improving quality of care and access. Sen. Tom Coburn (R-OK), a practicing physician and member of the committee, testified before the committee. He emphasized the necessity of a consumer driven market as a key to improving quality and access. He also mentioned transparency and adequate physician payments under Medicare as necessary components to an improved all around system. The remaining six panelists’ comments varied widely on the issue of competition from “vigorous” to “non-existent.”
Some panelists feared that competition in the industry has been stunted to the detriment of the consumer. Others argued that the growing number of Health Savings Accounts (HSAs) and increasing emphasis on transparency both demonstrate the incentives for providers and insurers to respectively compete to provide higher quality of care and more competitive prices.
Sen. Dick Durbin (D-IL) suggested the Federal Employees Health Benefits Plan (FEHBP) as an ideal model for all health care consumers. According to Sen. Durbin, premiums have been kept low, and access to physicians and hospitals is ample. Sen. Coburn recognized the fact that albeit minor increases in premiums, reimbursement to providers saw no change.
Sen. Arlen Specter (R-PA) and Sen. Patrick Leahy (D-VT) both urged the Department of Justice (DOJ) and Federal Trade Commission (FTC) to examine and enforce antitrust laws against physician groups as well as insurance companies. While a representative from the American Medical Association (AMA) provided testimony, all five of the insurers invited to attend declined.
Marcelino Oliva, DO, FACOFP chairs the ACOFP Committee on Federal Legislation. Ray Quintero serves as ACOFP’s Director of Government Affairs. ACOFP members may contact Mr. Quintero at 800-962-9008, extension 8648, or by e-mail at rquintero@osteopathic.org.