Elections over, organized medicine begins Medicare payment campaign

Physicians seek stability in Medicare pay through 2011 while pursuing a permanent solution to problems posed by the SGR formula.

By Chris Silva — Posted Nov. 8, 2010

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The American Medical Association and others in organized medicine say they are pushing for a Medicare pay solution that would prevent any threatened cuts through 2011.

Once that is attained, the AMA and others said they would work with the new Congress -- which will have a narrow Democratic majority in the Senate and flip to a solid Republican majority in the House -- to find a permanent solution for the sustainable growth rate formula, part of a mechanism that determines physicians' Medicare payments. The prospect of ever-rising mandated Medicare pay cuts has been a major concern for physicians in recent years, particularly in 2010. Congress has had to intervene on four separate occasions in 2010 to avoid a large reduction in Medicare physician payments.

The AMA and other leading organized medical organizations said they realize that the upcoming lame-duck session, which begins Nov. 15, will not pass the permanent solution to the SGR that is desired. They are seeking a 13-month patch to at least get them through 2011 while they negotiate with lawmakers.

"That will at least give us time over the next year to work with the new Congress and get rid of this horribly flawed [SGR] formula, and put in place a method of physician payment that works," said AMA President Cecil B. Wilson, MD. "The AMA is urging Congress to take swift action when it returns in November."

That view was echoed by Roland Goertz, MD, president of the American Academy of Family Physicians. "Is this completely acceptable? No, it's not. But it should help us move toward a more permanent solution. And hopefully now that the elections are over, there will be a settling effect that focuses on what we need in the future."

Physicians are slated to get hit with a 25% reduction in Medicare payments over two months, according to the final 2011 physician fee schedule released Nov. 2 by the Centers for Medicare & Medicaid Services. CMS revised that downward from its original estimate of a 29.5% cut. Pay is still slated to go down 23% on Dec. 1 but would go down 2% -- rather than 6.5% -- on Jan. 1, 2011, assuming Congress takes no action.

As of Nov. 5, three days after the election, Republicans won enough seats to get a 239-187 edge in the House, with 9 races undecided. Democrats held a 51-46 lead in the Senate, though it is 53-46 counting two independents who caucus with the Democrats. One race -- Alaska -- was still undecided.

Unfinished business

But before that new Congress is seated on Jan. 3, 2011, there will be a lame-duck session of the current Congress, which is 256-178 for Democrats in the House, and 58-42 for Democrats in the Senate (including the two caucusing independents). The Democratic edge in the lame-duck Senate fell by one when Illinois voters elected Republican Mark Kirk to fill the unexpired term of Obama, replacing an appointed Democrat. The number of Republicans in the lame-duck House fell by one because Kirk will leave his seat there to go to the Senate.

The lame-duck Congress is expected to have a full plate of big issues that were shelved before the elections -- most notably whether to make permanent the tax cuts, passed during the administration of former President George W. Bush, that are set to expire at year's end. Other expected issues include whether to extend unemployment benefits, votes on funding of government operations and the possible repeal of the "Don't ask, don't tell" law that allows gays to serve in the military only if they do not disclose their sexual orientation.

Another complicating factor, this one specific to Medicare pay, has a Tea Party connection. Observers say that debt-cutting goals of the Tea Party organizations probably will affect the debate. The estimated $17 billion cost of a 13-month patch might have to be cut from somewhere else, creating a logjam in Congress.

"One of the key issues that appears to be leading the Republicans is that federal spending is out of control, so at this point, SGR fixes need to be paid for," said Paul Ginsburg, PhD, president of the Center for Studying Health System Change. Nevertheless, "both the Republicans and the Democrats want to fix the SGR and avoid a sharp decline in payment rates."

Lawmakers have been unable to reach agreement on a permanent solution because of the price tag -- the most recent estimate by the Congressional Budget Office places the cost at $276 billion over 10 years.

"For physicians, the SGR challenge does not get any easier. It's a bipartisan problem. The cost is enormous, and the money is very hard to find so it doesn't matter who is in charge," said Kristen Hedstrom, assistant director of legislative affairs at the American College of Surgeons.

Many experts feel the most likely scenario is that the lame-duck Congress will pass a one- or two-month SGR reprieve, and that the new Congress will pass a longer patch to get through 2011. "I think we're likely to see a short-term patch that's going to punt it down the road, as usual," said Jack Lewin, MD, CEO of the American College of Cardiology. "[But] we would like to see a 13-month patch, at a minimum, to get us through 2011 and at least start us with conversations with the new Congress."

Stability desired

Observers say Congress is aware that a cut in physician pay probably would restrict access for Medicare patients. Dr. Wilson said a recent AMA poll shows that the ongoing threat of cuts is having an impact, with about one in five physicians already limiting the number of Medicare patients they treat.

Research released Oct. 25 by the Medical Group Management Assn., which represents physician practices of 10 or fewer doctors, concluded that 67% of medical practices are likely to limit the number of new Medicare patients they accept unless Congress halts the upcoming Medicare payment cuts.

In the past, when pay cuts became effective before Congress could pass a short-term patch, lawmakers instructed the Centers for Medicare & Medicaid Services to hold claims to ensure that physicians did not receive checks reflecting the cuts. In each case, Congress passed a short-term patch that reversed them. Nonetheless, the process has proved exasperating to those in the system.

Moving back to dealing with an annual cut at least would restore some stability to the system, others agree.

"We want to at least see this get back to an annual basis and put some predictability back in the program," said Shawn Martin, director of government relations at the American Osteopathic Assn. "This 30-day or three-month mentality has wreaked havoc on our membership."

Ultimately, the AMA is hopeful that lawmakers will find common ground and ensure that patients have access to health services.

"As the nation's largest physician organization, the AMA remains committed to working with lawmakers on both sides of the aisle in the 112th Congress to make improvements on issues important to patients and physicians, including fixing our broken Medicare physician payment system, enacting medical liability reforms, and addressing the Independent Payment Advisory Board and other refinements to the health system reform law," Dr. Wilson said.

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Physician ranks grow in Congress

Twenty-one physicians were elected to Congress on Nov. 2, and two physicians will be heading home -- a net addition of six for a total of 22. How major-party candidates fared:

Elected to the House

  • Mike Fallon, MD (R, Colo.), emergency physician
  • Larry Bucshon, MD (R, Ind.), thoracic surgeon
  • Andy Harris, MD (R, Md.), anesthesiologist
  • Dan Benishek, MD (R, Mich.), surgeon
  • Joe Heck, DO (R, Nev.), emergency physician
  • Nan Hayworth, MD (R, N.Y.), internist
  • Scott DesJarlais, MD (R, Tenn.), family physician

Re-elected to the House

  • Rep. Charles Boustany Jr., MD (R, La.), cardiovascular surgeon
  • Rep. Paul Broun, MD (R, Ga.), family physician
  • Rep. Michael C. Burgess, MD (R, Texas), obstetrician/gynecologist
  • Rep. Bill Cassidy, MD (R, La.), gastroenterologist/internist
  • Del. Donna M.C. Christensen, MD (D, Virgin Islands), family physician
  • Rep. John Fleming, MD (R, La.), family physician
  • Rep. Phil Gingrey, MD (R, Ga.), obstetrician/gynecologist
  • Rep. Jim McDermott, MD (D, Wash.), psychiatrist
  • Rep. Ron Paul, MD (R, Texas), obstetrician/gynecologist
  • Rep. Tom Price, MD (R, Ga.), orthopedic surgeon
  • Rep. Phil Roe, MD (R, Tenn.), obstetrician/gynecologist
  • Rep. Vic Snyder, MD (D, Ark.), family physician

Elected to the Senate

  • Rand Paul, MD (R, Ky.),ophthalmologist [son of Dr. Ron Paul]

Re-elected to the Senate

  • Sen. Tom Coburn, MD (R, Okla.), obstetrician/gynecologist

In the Senate, not up for re-election

  • Sen. John Barrasso, MD (R, Wyo.), orthopedic surgeon

Lost House election

  • Ami Bera, MD (D, Calif.), general practitioner
  • Loraine Goodwin, MD (D, Calif.), general practitioner
  • Rep. Parker Griffith, MD (incumbent, lost primary) (R, Ala), radiation oncologist
  • Thomas Hayhurst, MD (D, Ind.), pulmonologist
  • Rep. Steven Kagen, MD (incumbent) (D, Wis.), allergist/ immunologist
  • Marianette Miller-Meeks, MD (R, Iowa), ophthalmologist
  • Rob Steele, MD (R, Mich.), cardiologist
  • Manan Trivedi, MD (D, Pa.), internist

Lost Senate election

  • Eric Wargotz, MD (R, Md.), pathologist

Sources: State elections offices, AMPAC

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What's next for health system reform?

Rep. John Boehner (R, Ohio), the presumptive speaker of the House of Representatives once that body becomes majority Republican in January, said the morning after Election Day that his party will "lay the groundwork" to repeal the Patient Protection and Affordable Care Act -- better known as health system reform. Boehner went so far as to call the law a "monstrosity."

But can health system reform really be repealed?

Two formidable challenges exist for Boehner and anyone else who wants to see health system reform undone.

One is that the Senate will remain under Democratic control, and even if some Democrats are sympathetic to repeal, the Republicans are unlikely to get the 60-40, filibuster-proof vote they need.

The other challenge is that Barack Obama is still president.

At a White House news conference Nov. 3, Obama said that any attempt at repeal would be "misreading the election." He said voters do not want to see the president and Congress "relitigate" laws enacted during the first two years of his term.

Obama has noted repeatedly that the bill expands health insurance to 30 million Americans while reducing the federal budget deficit in the long term. Opponents, however, say the bill is an unwarranted, expensive government intrusion on health care.

But even if Republicans can't repeal health system reform, observers say Republicans have other tools at their disposal to change the reform law or limit its scope.

For example, opponents could try to hold back on any of the $115 billion of funding that needs congressional approval. Some Republicans in the House and Senate have said they would propose changes to the individual mandate for buying insurance, such as allowing states to opt out of it, and roll back requirements for states to expand Medicaid and set up health insurance exchanges for individual policies.

At his news conference, Obama said he was willing to listen if "Republicans have ideas to improve the health care system" that deliver "faster, more effective reform."

For example, Obama cited one provision Republicans have spoken out against, one that requires businesses, beginning Jan. 1, 2012, to file a 1099 form with the Internal Revenue Service for every vendor where they spend at least $600 annually on goods and services, exempting credit-card purchases. Obama said the provision, meant to raise $17 billion over 10 years, was "probably counterproductive," and that if it is too burdensome for small businesses, "it's something we should take a look at."

"If we take that approach, which is different from campaigning; it's governing, we can continue to make some progress and make some common ground," Obama said.

AMA President Cecil B. Wilson, MD, said the organization is supportive of health system reform but added, "This is not a perfect law." For example, Dr. Wilson said it does not do enough for liability tort reform.

However, he said, "At the end of the day, there is a lot in the law that is good for patients, and good for America ... We look forward to working with lawmakers on both sides of the aisle to correct those defects."

Meanwhile, in two states -- Arizona and Oklahoma -- voters passed ballot initiatives to amend their state constitutions so that citizens would not be required to buy health insurance, or get penalized for not doing so. The issues will be taken up in their state legislatures. Colorado voters rejected a similar initiative. (See correction)

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In an earlier version, this article incorrectly reported the results of the Colorado ballot measure on requiring health insurance. American Medical News regrets the error.

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