Medicare makes promises; physicians bear the burden

A message to all physicians from AMA President William G. Plested III, MD.

By William G. Plested III, MDis a thoracic and cardiovascular surgeon from Brentwood, Calif. He served as AMA board chair during 2003-04, and as AMA president during 2006-07. Posted Aug. 21, 2006.

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This July, my wife, Carolyn, and I had the pleasure of spending some time in southwestern Colorado. The beauty and grandeur of this area is stunning. We have been able to slow down a little and focus a bit of time on family and friends. I would recommend that everyone find a way to take some time out of your busy lives for similar pursuits.

I received a rude awakening several days ago when the headlines of the local newspaper announced that a relatively large local clinic stopped accepting new Medicare patients. The administrator of the practice stated that the decision was dictated by economics. The article went on to say that other practices in the area had made similar decisions.

This area is basically rural but has experienced changes that have been seen throughout the country. Farmers and ranchers have learned their most valuable "crop" is their land. Family after family have sold their land to developers who have cut it up into 35-acre parcels that are the minimum size to use wells and individual septic systems, or into lots that are annexed into existing towns or developed into their own metro districts.

The allure of the area has driven up the prices of such "dream homes" to the point that they are affordable only to out-of-town folks who have ready cash. In most cases such people are retirees (i.e., people who are Medicare age) and new to the area. This influx has been in addition to the general aging of the population that is widespread.

In this particular locality, this constant increase in the Medicare population has given rise to what I have called a silent epidemic. That epidemic is the inability of primary care physicians to accommodate the onslaught of new Medicare patients. This is especially true when reimbursement for seeing these patients doesn't cover the physician's costs of practice. Physicians are loyal to established patients; however, they can legally and ethically protect the fiscal viability of their practices by not accepting new Medicare patients.

At this point, the finger-pointing and accusations begin. But, let's take a few moments to briefly review a few basic facts and some promises that have been made by our government to Medicare patients and to the physicians who accept the responsibility for their care.

First, the cornerstone promise made to seniors was that at age 65, the government would assume responsibility for the payment for medical services. It is important to remember that at the time this promise was made there were several realities that have since ceased to exist.

Briefly, these are: medicine had precious little to offer beyond the care and concern of a physician; the 65-and-older population was demographically the poorest segment of the population, with the majority of wealth centered in actively working age groups; and the life expectancy beyond age 65 was very short.

Since that time, all have changed drastically, but government has not changed its promise to patients. The catch is that it has chosen to make good on its promise to patients by relentlessly reducing payments to physicians for the care they render.

To me, it is remarkable that physicians have been as steadfastly loyal to their Medicare patients as they have been. The local phenomenon that I reported gives some insight into a possible reason for this. Most physicians run solo or very small group practices that they supervise and administer themselves. Business concerns of the practice are almost always secondary to moral and ethical considerations given to an individual patient.

That brings us to a much more recent promise that the government, or more precisely the Centers for Medicare & Medicaid Services has made to the physicians of America. That promise is that on Jan. 1, 2007, CMS will cut payments to physicians by 4.7%. Furthermore, that such cuts would continue on a yearly basis for at least the next nine years. Over this time, the cuts would total at least 37% and would be accompanied by increases in the costs of running a practice that would be at least 22%.

It's no wonder that this promise by CMS is taken seriously by professionals who accept the responsibility of keeping the doors of a medical practice open to their patients.

The decision to not accept new Medicare patients while honoring commitments to established patients is a logical, ethical and understandable response.

The AMA has been aggressively taking, across the United States, the message of the threat of a loss of access to care for Medicare patients that these cuts portend.

We have spent untold hours with all types of media, including radio, television and newspaper columnists, and editorial boards. We believe that promises matter and, therefore, that the illogical formula that mandates such cuts be rescinded and replaced by a new process that realistically ensures the promise to seniors made by government.

Rep. Michael Burgess, MD (R, Texas), an obstetrician-gynecologist, has introduced such a bill in the House of Representatives (HR 5866). His bill stops the cuts and mandates yearly physician payment updates that more closely reflect practice cost increases.

The AMA and the Texas Medical Assn. have urged Dr. Burgess to modify his bill to base annual updates on the full Medicare Economic Index. The current bill provides for annual updates based on the MEI minus 1%. The bill also would strengthen Medicare financing by requiring higher-income seniors to pay increased premiums and authorizing balance billing by physicians who report quality data. (Balance billing would be limited to single patients earning $80,000 or a couple earning $160,000 per year.)

It is essential that Congress take action by October to pass legislation that prevents the cuts scheduled under current law.

For now, urge all of your patients to call their congressional representatives and urge them to pass legislation to provide a 2.8% update next year and provide annual updates that reflect increases in physician practice costs.

They can easily do this by using the AMA Patient Action Hotline at 888-434-6200.

Time is running out. We need to work together now.

William G. Plested III, MD is a thoracic and cardiovascular surgeon from Brentwood, Calif. He served as AMA board chair during 2003-04, and as AMA president during 2006-07.

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