Health reform package still needs some improvement

As we enter the new year, we begin where we left off in 2009 -- with work still to do on health system reform. Topping the AMA's "to-do" list in 2010 is improving the final health reform bill as the House and Senate work to reconcile their two versions, and securing permanent repeal of the broken Medicare physician payment formula.

Let me start with Medicare physician payment reform and the confusion expressed by some over its absence in the final Senate legislation. Eliminating the one-year fix originally in the Senate bill produced an immediate upside, as the funds were used to eliminate:

• Budget neutrality adjustments for the primary care bonus.
• Taxes on elective cosmetic surgery and medical procedures.
• Physician enrollment fees for Medicare and Medicaid programs.

Most important, it creates a sense of urgency among senators to act on permanent repeal before the two-month reprieve from the 21% cut ends on March 1. Continuing with short-term fixes is the wrong solution -- and it's one we do not support. It wreaks havoc on physician practices, threatens the stability and security of Medicare access for seniors and military families, and increases the cost of permanently repealing the Medicare physician payment formula.

Only permanent repeal of the flawed Medicare physician payment formula will allow the problem to be solved permanently in a fiscally responsible way that respects both physicians and patients. Your AMA leadership has shared this with Senate and House leadership.

We now have a short window of opportunity for the Senate to take similar action to the House. We are calling on the Senate to repeal the broken Medicare physician payment formula and replace it with one that better reflects the cost of providing 21st-century medical care.

We are mobilizing state and national specialty medical societies in support of this initiative, but your voice as an individual physician is critical. Please visit the AMA's health system reform Web site to see where your senators stand on this critical issue and reach out to them (link).

As we work together to repeal the broken Medicare physician payment formula, the AMA continues to work closely with House and Senate leadership and White House officials to secure important changes in the final reform bill to more closely align it with our guiding principles.

Key issues that the AMA will be addressing during the House-Senate negotiation include:

Independent payment advisory board: AMA advocacy will focus on preventing the potential for physicians to face multiple expenditure targets and cuts; ensure that hospitals and other providers are not exempted from the process; provide that Congress retain responsibility for major policy changes; and guarantee that any new entity operate under safeguards and procedural requirements that promote transparency, accountability and sound public policy.

Quality and public reporting: During the drafting of the legislation, the AMA was able to insert some safeguards, but more work remains. Any publicly released information must be accurate, valid, verifiable and available for review by physicians before release.

Additional work will focus on clarifying the authority of the HHS secretary to implement new value-based payment methodologies, as well as quality and cost measures, and removing payment penalties proposed by the Senate for physicians who do not participate in the Medicare quality reporting program.

House provision to increase Medicaid payments for primary care physicians: The AMA strongly supports the House provision that would increase Medicaid payment levels for primary care physicians to Medicare rates. The federal government would cover nearly all of the projected $57 billion increase in physician payments in the Medicaid program.

Medical liability: The AMA will work to secure final language that authorizes a grant program for a broad array of state alternative medical liability reforms. We will work to strike language allowing patients to opt out of the alternative liability program. We'll also focus on protecting physicians against potential new causes of action based on quality or payment adjustments.

Comparative effectiveness research: The AMA will vigorously oppose attempts to inject payment and coverage decisions into CER research and recommendations.

Physician-owned hospitals: With both versions of the bill banning new physician-owned hospitals, the AMA will work to improve the grandfather provisions for existing physician-owned hospitals.

Administrative simplification: We support House language that contains a broader range of administrative simplification requirements to benefit physicians.

Fraud and abuse: The AMA is concerned about provisions in both bills that would modify the intent standard in the Medicare and Medicaid anti-kickback statute. We also are opposed to the Senate proposal to expand the Recovery Audit Contractor program.

GME/work force: We will work to delete proposed federal studies and reports on residency and medical school curriculum requirements.

Federal/state insurance regulation: The AMA will carefully monitor negotiations regarding changes in the oversight of insurance companies, with a focus on protecting state successes in enforcement of prompt-pay and patient-protection requirements.

Public option: The Senate bill does not include a public option. The best approach is to provide choices of private health plans though a health insurance exchange, with coverage that cannot be taken away if you get sick or lose your job.

Clearly, the final word on health system reform has not been written. The AMA remains actively and constructively engaged, working to secure the best outcomes for physicians and patients. As we enter the final stage of the reform process, lend your voice and your advocacy to our efforts. Right now, the focus needs to be on the Senate effort to permanently repeal the Medicare physician payment formula. With your help, we will make this new year a truly historic one for our health care system.