|
your path: Home > Public Policy >
Raising Medicare Reimbursement Rates and Testing 'Medical Home' Model May Improve Quality, Witnesses Say at Senate Finance Committee Hearing
Increasing Medicare reimbursement for primary care and implementing a pilot program to test the "medical home" care model" for beneficiaries with chronic conditions could pave the way for much needed changes in our healthcare system, according to experts testifying at a recent Senate Finance Committee hearing.
Low Medicare reimbursement, the experts agree, discourages physicians-in-training from pursuing careers in internal medicine and family medicine - the two fields that are the source of applicants for geriatric fellowship programs. Currently, there are shortages of primary care physicians, general internists, general surgeons, and geriatricians, shortages expected to worsen as America's 77 million baby boomers age.
The most popular fields, such as radiology, orthopedics, anesthesiology and dermatology, pay significantly more, according to Robert Berenson, senior fellow at the Urban Institute who testified before the committee. "In addition to being highly remunerative (these fields) also support gentler lifestyles, usually without emergencies outside of regular work hours," he added.
Mark Miller, executive director of the Medicare Payment Advisory Commission, noted that Medicare's fee-for-service structure, which has created separate reimbursement "silos" for different services, discourages care coordination, thereby undermining quality. "Providers need to increase care coordination and be jointly accountable for quality and resource use," he said.
According to other expert witnesses, a Medicare pilot program to test the use of "medical homes" for beneficiaries with chronic conditions could help determine whether such programs will improve coordination of care and reduce costs. Medical homes, said Glenn Steele, President and CEO of Geisinger Health System, allow staff to "get to know the patients and their families, follow their care, help them get access to specialists and social services, follow them when they are admitted to a hospital, contact them to confirm that they are taking the appropriate medication dosages, and are available for advice 24 hours a day."
A leading problem with our current healthcare system is that reimbursement is generally based on the number of services performed rather than the quality of care provided, which often leads to unnecessary tests, "inadvisable prescriptions," and expensive surgeries, "only to be ignored when they leave the hospital," added Finance Committee Chair Max Baucus (D-MT).
Costs associated with unnecessary and poor quality care account for more than 30 cents of every dollar spent on healthcare, or over $600 billion annually, CQ reports.
Back to top
*****
National Provider Conference Call on 2008 Physician Quality Reporting Initiative Slated for September 18; Registration Deadline is September 17
The Centers for Medicare & Medicaid Services (CMS) will host the seventh in its series of provider conference calls on the 2008 Physician Quality Reporting Initiative (PQRI) September 18. The toll-free conference call will cover registry reporting for 2008; E-prescribing for the 2008 and 2009 PQRI; incentives for electronic prescribing; and 2007 PQRI feedback reports and incentive payments. There will be a question and answer session with CMS experts. The conference call will begin at 3:30 p.m. and end at 5:00 p.m., EDT.
Under the PQRI, eligible professionals who report on a designated set of quality measures for services covered by the Medicare Physician Fee Schedule and provided between July 1 and December 31 can earn a bonus payment of 1.5% of their charges, subject to a cap. A list of eligible professionals is available on the CMS Web site. All eligible Medicare-enrolled professionals can participate in the 2008 PQRI, regardless of whether they've signed a Medicare participation agreement to accept assignment on all claims.
To get call-in information for the September 18 teleconference, you must register for the call. If you're planning to sit in with a group, only one person need register. Registration will close at 3:30 p.m. EDT September 17, or when available space has been filled. A PowerPoint slide presentation will be posted to the PQRI webpage. You can download the presentation prior to the conference, and follow along with the presenters, Dr. Michael Rapp, and Dr. Daniel Green.
For those unable to attend, a replay option will be available from 5:30 p.m. EDT September 18 until 11:59 p.m. EDT September 25. The call in number for the replay is (800) 642-1687 and the passcode is 61954941.
Back to top
*****
On Advice of AGS, Others, CMS Opts Not to Classify Delirium as a Hospital Acquired Condition
In keeping with recommendations from the American Geriatrics Society (AGS) and other organizations, the Centers for Medicare & Medicaid Services (CMS) has decided against designating delirium a hospital acquired condition (HAC) in its updated Hospital Inpatient Prospective Payment Systems (IPPS) guidelines. HACs are generally not reimbursed.
CMS proposed designating delirium an HAC, and other changes, while updating IPPS policies and payment rates for Fiscal Year 2009. The agency's decision appears in August 8 Federal Register.
In a June letter to CMS Acting Administrator Kerry Weems, AGS President John B. Murphy, MD, concurred that the onset of delirium in older patients is a pressing problem, and noted its association with increased morbidity, decline, longer hospital stays, higher rates of institutionalization, increased costs, and higher mortality.
"AGS is pleased that CMS appears to have identified delirium as an important quality issue and as a condition that can impact hospitalized patients," Dr. Murphy wrote. "We support reasonable steps to give hospitals incentives to recognize and treat delirium, however, we have significant concerns regarding CMS' proposal to add delirium to the list of "preventable" hospital acquired conditions."
Research suggests that following current evidence-based guidelines for preventing delirium can prevent only 30% to 40% of cases, the letter pointed out. This "does not, in our opinion constitute "reasonably preventable" under the statutory criteria. CMS should not add delirium to the list until the use of evidence-based guidelines can reasonably prevent delirium at least 66 to 75 percent of the time." The letter urged CMS to gather additional data to determine whether delirium is in fact "reasonably preventable" in most cases before acting, and offered AGS' assistance with this and related efforts.
In its final ruling, CMS notes that "most commenters" responding to its proposal opposed designating delirium an HAC and that many noted, as did AGS, that applying current guidelines would result in the prevention of just 30-40% of delirium cases. The agency, the ruling states, will continue to monitor guidelines concerning delirium prevention and may consider proposing delirium as an HAC in the future "if evidence warrants."
"We applaud CMS for its well reasoned decision to further investigate the prevention of delirium, which poses a serious threat to older patients," said Caroline Blaum, MD, Chair of AGS' Quality Performance and Measurement Committee. "AGS would be pleased to continue to work with CMS in this endeavor."
Though CMS chose not to designate delirium an HAC, the agency did add two additional ICD-9-CM codes for delirium. These are 292.81 for drug-induced delirium, and 293.0 for delirium due to conditions classified elsewhere.
AGS thanks its leaders who provided input into its comment letter, including Sharon Inouye, MD, Caroline Blaum, MD, Neil Wenger, MD, MPH, Keela Herr, PhD, RN, FAAN, Ronnie Rosenthal, MD, Debra Saliba, MD, MPH, Peter Hollmann, MD, AGSF, Todd Semla, MS, PharmD, AGSF, Sharon Brangman, MD, AGSF, Cheryl Phillips, MD, CMD, AGSF, and Barbara Resnick, PhD, CRNP, FAAN, FAANP.
Back to top
*****
CMS Increases Payments to Hospices and Nursing Homes Serving Medicare Beneficiaries
Medicare payments to hospice agencies will increase 2.5% and payments to nursing homes will rise 3.4% next year, the Centers for Medicare and Medicaid Services (CMS) announced July 31.
The hospice payment boost is the result of a 3.6 % increase in the "hospital market basket indicator of cost" offset by a 1.1 % decrease due to the phase-out of an adjustment to the annually updated hospice wage index that took effect 10 years ago. The wage index recalibrates payment rates to reflect local differences in wages. CMS introduced the adjustment in 1997 to help hospices transition to a new wage index. The Medicare Payment Advisory Commission (MedPAC) reports that expenditures for hospice are projected to grow faster than those for hospitals, skilled nursing facilities, physician services and home health care through 2015.
The increase in payments to nursing homes is the result of a 3.4 % increase in the annual market basket calculation of the cost of goods and services included in a skilled nursing facility stay. A recalibration of CMS' nursing home payment structure that had been proposed for fiscal year 2009 has been delayed while CMS continues to evaluate the change, CMS reports.
Back to top
*****
Congress Overrides Presidential Veto to Block 10.6% Medicare Physician Pay Cut
Rescinding a potentially devastating 10.6% Medicare pay cut to physicians, both houses of Congress voted July 15 to override a presidential veto of legislation blocking the cut. The legislation, the Medicare Improvements for Patients and Providers Act of 2008 (H.R. 6331), replaces the 10.6% cut with 12 months of stable payments, and a 1.1% increase for 2009.
In a recent American Medical Association survey, 60% of physicians indicated that the pay cut would make caring for Medicare beneficiaries so financially untenable that they would be forced to limit the number of new Medicare patients they saw. Mandated by Medicare's controversial Sustainable Growth Rate (SGR) formula, the pay cut was slated to take effect July 1. On June 30, however, the Administration moved to delay processing of Medicare claims through July 15.
The House voted 383-41 that day to override President Bush's veto, comfortably surpassing the two-thirds majority required. A total of 153 House Republicans voted to defy the White House, 24 more than in the chamber's initial June 24 vote approving the measure.
The Senate voted 70-26 to override the veto, with 21 Senate Republicans endorsing the bill, including four who had voted "nay" in two previous votes on the legislation.
The measure addresses many issues beyond Medicare physician fees. Among other things, it boosts payments for specified mental health services 5%. It also includes provisions concerning the extension Special Needs Plans (SNPs) and electronic prescribing. Funding for the expansion of the Patient Centered Medical Home Project will increase under the legislation, to $100,000,000. And the Physician Quality Reporting Initiative (PQRI) will be extended through 2010; with payment bonuses for physicians who successfully report on PQRI measures increasing to 2 percent (up from 1.5 percent in 2007 and 2008).
In addition, the legislation provides broader protections for low-income Medicare beneficiaries including increased coverage for preventive services and reduced co-payments for mental health services.
AGS thanks its members and others who joined Society advocacy campaigns calling on Congress to block the physician pay cut. It also commends Congress for helping ensure older Americans access to quality healthcare. AGS will continue to advocate for a viable alternative to the SGR.
Back to top
*****
CMS to Pay More than $36M to Participating Physicians for 2007 PQRI Reporting Period
The Centers for Medicare and Medicaid Services (CMS) will pay in excess of $36 million in bonuses to the more than 56,700 healthcare professionals who reported data concerning the quality of the care they provided to beneficiaries between July and December 2007 under the Physician Quality Reporting Initiative (PQRI).
The PQRI, a voluntary program established in 2006, offers healthcare providers bonus payments of 1.5% of their total CMS-covered payments for reporting specified quality information to the agency. For individual professionals, the average incentive payment for the first round of the program will exceed $600, CMS has announced. For group practices, the average payment will exceed $4,700. The largest payment to a practice will be in excess of $205,700. Physicians, physician group practices, and other PQRI-eligible professionals should receive their payments by August.
"Creating a value-based purchasing system is a critical way to improve our health care systems," said Health and Human Services Secretary Michael Leavitt. "By collecting quality data, health care providers can use the information to improve the quality care of beneficiaries."
Back to top
*****
Congress Expected to Override President's Planned Veto of Legislation Blocking 10.6% Medicare Pay Cut
The House and Senate are expected to vote today, July 15, to override President Bush's planned veto of legislation that would rescind a mandated 10.6% cut in Medicare payments to physicians, Congressional Quarterly (CQ) reported yesterday. Both chambers of Congress approved the measure by veto-proof margins last week.
The pay cut, mandated by Medicare's controversial Sustainable Growth Rate formula, would threaten older American's access to healthcare. In a recent American Medical Association survey, 60% of physicians indicated that the cut would make caring for Medicare beneficiaries so financially untenable that they would be forced to limit the number of new Medicare patients they saw. The pay cut was slated to take effect July 1, but on June 30 the Administration moved to delay processing of Medicare claims until today. The legislation would replace the scheduled 10.6% cut with 18 months of stable payments.
A "senior administration official" said President Bush will veto the Medicare bill (HR 6331) today, CQ reported. Congressional aides and spokesmen told reporters that both the House and Senate would vote on the veto override today as well. Congress is expected to succeed in overriding the veto.
The President and other Republicans have balked at provisions in the bill that would offset the costs of rescinding the cut by trimming payments to private Medicare Advantage. They contend that the cut in payments to Medicare Advantage will lead to benefit rollbacks for the 20% of Medicare beneficiaries who rely on the private program. Medical groups, however, argue that the cuts will "largely eliminate waste because private insurers charge the government, on average, 12% to 17% more than the Medicare program charges," according to The Los Angeles Times.
In an initial vote on the bill on June 26, the Senate was able to muster just 59 of the 60 votes needed to pass the Medicare legislation with a veto-proof margin. A 355 to 59 June 24 vote in favor in the House, however, encouraged Senate Majority Leader Harry Reid (D-NV) to continue pressing for approval. On July 9 -- roughly two weeks after the overwhelming, bipartisan House vote -- the Senate passed the legislation in a veto-resistant 69-30 vote. Sen. Edward Kennedy (D-MA.) -- who returned to Congress for the first time since undergoing treatment for cancer in early June to vote -- cast the needed 60th "Aye" for the legislation. Following Sen. Kennedy's vote, another nine legislators reversed themselves to approve the measure.
According to groups representing the military, the planned 10.6% cut would also hurt the 9.2 million active and retired military employees and their family members who are covered under the military's Tricare system, which uses payment rates set by Medicare.
AGS applauds the Senate and Congress for approving legislation to block the cut, and the many Society members and other advocates for quality elder healthcare who have joined its advocacy campaigns on behalf of the measure.
Back to top
*****
Medicare and Other Public Health Insurance Programs Contribute to Marked Income Gap between Geriatricians and Other Specialists and, As Result, to Geriatrician Shortage, Study Finds
Medicare payment policies are contributing to income disparities between geriatricians and higher compensated specialists and, as a result, to the marked shortage of geriatricians in the US, according to a September study in the Journal of General Internal Medicine. The study has been published early, online.
The Harvard Medical School researchers conducting the study analyzed data concerning 2004 Medicare, Medicaid, other government agency, private insurance and out-of-pocket payments to practitioners in 27 specialties, including geriatrics. Overall, government payments accounted for about a third of specialists' income. But for the highest and lowest paying specialties - hematology-oncology and geriatrics, respectively - public payments accounted for nearly 50% of income. There were extreme income disparities among the specialties, the researchers note. In 2004, hematologists-oncologists earned an average of $504,000, compared with $165,000 for geriatricians.
These disparities are contributing to shortages in geriatrics as well as primary care, the researchers note. "Of particular concern is the national shortage of geriatricians, the lowest paid specialty," they report. "The American Geriatrics Society estimates there are 7,600 certified geriatricians in the US despite a need for approximately 20,000 geriatricians. Ironically, Medicare's priority population, the elderly, is vastly underserved in part because of Medicare's own payment policies."
To address the problem, the researchers recommend steps to close the income gap. "Government could narrow inter-specialty income differentials by aligning billing codes and fee schedules with the amount of time physicians actually spend providing and coordinating care," they write.
The Geriatric Assessment and Care Coordination Act, now before Congress, would take a step in this direction by authorizing Medicare coverage of geriatric assessment and care coordination for beneficiaries with multiple chronic conditions. To join the American Geriatrics Society in its advocacy campaigns on behalf of this and other policy aimed at ensuring older Americans access to healthcare, please visit our Health in Aging Advocacy Center.
Back to top
*****
HHS puts 10-day Freeze on Medicare Payment Cuts, Senate Expected to Reconsider Legislation to Address Pay Cut when it Returns from the July 4th Recess
The Department of Health and Human Services has announced that CMS will instruct its contractors to not process any physician and non-physician practitioner claims for the first 10 business days of July. By holding claims for health care services that are delivered on or after July 1, CMS will not be making any payments on the 10.6 percent reduction until July 15, at the earliest. Meanwhile, all claims for services delivered on or before June 30 will be processed and paid in regular order.
The freeze on administrating payments is intended to allow Congress and the Administration time in early July to enact legislation to block a pending 10.6% cut in Medicare payments to providers will take effect on July 1.
The Senate is expected to again take up House-passed legislation when it returns from the July 4 recess. On June 26th, the Senate fell one-vote short of getting the 60 votes needed to consider the house-passed measure, "The Medicare Improvements for Patients and Providers Act of 2008" (H.R. 6331). This legislation would extend the 0.5% pay increase Congress earlier authorized for the first half of 2008 and provide a 1.1% pay boost in 2009. In the House, the bill garnered well over the needed 2/3 majority required to override a possible Presidential veto.
Two weeks ago, the Senate failed to invoke cloture (a procedural motion to move to debate) on a similar bill (S. 3101) that Senate Finance Committee Chairman Sen. Max Baucus (D-MT) sponsored.
The 10.6% Medicare physician fee cut is mandated by Medicare's controversial sustainable growth rate (SGR) formula. The SGR forces cuts in Medicare payments to physicians whenever increases in these outlays exceed growth in Gross Domestic Product - unless Congress blocks the cutbacks. The American Geriatrics Society and others have been urging legislators to avert the 10.6% cut which, surveys suggest, may prompt physicians to stop accepting new Medicare patients and, as a result, limit older Americans' access to healthcare.
The House bill also includes funding for a medical home demonstration project and provisions concerning private Medicare Advantage Special Needs Plans, ePrescribing, and quality initiatives. In addition, the legislation would enhance some beneficiary programs by, among other things, expanding Medicare coverage for preventive services, offering premium assistance for low-income beneficiaries, and cutting patient cost-sharing for mental health services.
Many thanks to those members who joined our most recent campaign to block the pending 10.6% cut and encourage the passage of H.R. 6331 which offers a fix for provider payments. If you did not yet take action, please participate in our Senate campaign. Just visit AGS' Health in Aging Advocacy Center to access the campaign.
Back to top
*****
CMS Letters Notify Incorporated Physician Practices That Their NPI Data Must Include Their Corporation's Legal Business Name
Physician practices that are incorporated, but do not have their corporation's legal business name (LBN) in the Medicare database of physicians' National Provider Identifiers (NPI) must rectify this, the Centers for Medicare and Medicaid Services (CMS) announced recently.
To ensure that NPI practice information is consistent with Internal Revenue Services (IRS) employer identification (EIN) information, CMS has started sending letters to practices, notifying them that they must ensure that their NPI data includes their corporate LBN.
Although the CMS letters note that practices have 15 days to respond, the American Medical Association has received assurances from the agency that it will not deactivate any NPI numbers immediately following this short timeframe.
As of May 2007, CMS began requiring all Medicare providers to use their NPIs on all Health Insurance Portability and Accountability Act (HIPPA) electronic transactions and all Standard Paper Remittance (SPR) and paper claims.
To obtain their EIN/LBN from IRS paperwork, physicians can check their CP-575 quarterly tax payment coupon among other IRS correspondence. Additionally, physician applicants can request a verification letter (IRS 147C) from the IRS that identifies their EIN and LBN.
Physicians are urged to do the following: respond immediately to Medicare, make any necessary changes to their LBN in their NPI record and contact the NPI database (NPPES) if they need additional time, at 800-465-3203.
Physicians unable to bill Medicare due to NPI problems may qualify for advance payments and are encouraged to contact their carriers to discuss their situation. If you have any questions, please contact Mari Savickis or call 202-789-7414.
Back to top
*****
CMS Asks Providers to Help Test New Quality Measures
The Centers for Medicare & Medicaid Services (CMS) will begin testing 11 new quality measures for possible inclusion in the Physician Quality Reporting Initiative (PQRI) Program in future years. These new measures focus on kidney disease, skin disease, eye care, imaging, arthritis, and cancer. CMS would like to gather test data for these measures to help plan for future PQRI measure sets.
CMS encourages providers to submit data for these test measures on Part B claims between July 1, 2008 and September 30, 2008. Note: Providers will not receive financial incentives for reporting data concerning these test measures.
To learn more about how you can help CMS test these measures, visit http://www.cms.hhs.gov/pqri and select the "Measures/Codes" link on the left side of the page.
Back to top
*****
Sen. Baucus Introduces Bill to Substitute 1.1% Increase in Medicare Physician Payments for Pending 10.6% Cut; Grassley Plans to Present Alternative
Senate Finance Committee Chair Max Baucus (D-MT) introduced legislation on June 6 that would block a 10.6% cut in Medicare physician fees that's slated to take effect July 1 and boost the payments 1.1% for the next 18 months, CQ Today reports.
The 10.6% cut is mandated by Medicare's controversial sustainable growth rate (SGR) formula, which forces cuts in Medicare payments to physicians whenever increases in these outlays exceeds growth in Gross Domestic Product - unless Congress blocks the cuts. The American Geriatrics Society and others have been urging legislators to avert the 10.6% cut which, surveys suggest, may prompt physicians to stop accepting new Medicare patients.
Baucus' bill would cost $20 billion over five years and would be financed almost entirely through cuts to Medicare Advantage plans, private plans that cost taxpayers more than traditional Medicare. The White House has threatened to veto any bill that makes cuts to these plans.
Specifically, the bill would reduce indirect medical education payments under Medicare Advantage plans and decrease spending for a "stabilization fund" used to encourage private health insurers to participate, according to The Hill. In addition, the legislation would limit a process called "deeming," under which private health insurers force healthcare providers to participate in MA plans when they treat beneficiaries enrolled in those plans. The bill would also reduce Medicare reimbursements to oxygen providers, according to CQ Today.
Other provisions of Sen. Baucus' legislation include financial assistance for low-income beneficiaries enrolled in the Medicare drug benefit, an electronic prescribing initiative and a proposal to ensure prompt Medicare payments to pharmacies for drugs they dispense to beneficiaries.
Finance Committee ranking member Chuck Grassley (R-IA) plans to introduce competing legislation that will increase physician fees by 0.5% through 2008 and by 1.1% in 2009. Sen. Grassley's proposal would offset the cost of the increase with changes in payments to a narrow sector of Medicare Advantage plans. The senator has criticized Sen. Baucus' proposal for wider cuts to the private plans.
"It's going to guarantee a presidential veto," he said. "Without saying whether the President's right or wrong, I can say this - we've got to get things done by June 30, and that's going to make it impossible." If legislation is not approved by that time, physicians will see a 10.6% cut in payments take effect on July 1.
Back to top
*****
Register Now to Access Your 2007 Physician Quality Reporting Initiative (PQRI) Feedback Report
2007 Physician Quality Reporting Initiative (PQRI) Final Feedback Reports will be available in mid-July on a secure Web site, the Centers for Medicare and Medicaid Services (CMS) has announced. Reports will be available to each practice, identified by Taxpayer Identification Number (TIN), in which at least one eligible professional reported 2007 PQRI quality measures data. Reports will include information on reporting rates, clinical performance, and incentives earned by individual professionals, with summary information on reporting success and incentives earned at the practice level.
Please Note: CMS recommends that practices take the time, now, to set up their online accounts so they can access their reports as soon as these are available. As a first step, professionals and appropriate staff must register for access through a new CMS security system known as Individuals Authorized Access to CMS Computer Services - Provider Community (IACS-PC).
Only practices with multiple professionals or individual professionals with staff members who will access the PQRI feedback reports should register in IACS-PC. To establish their practice as an IACS-PC organization, participants must register a "security official" for the organization. Because the process of verifying the designated security official's authorization to access the practice's confidential information is not fully automated and can take some time, such practices should begin registering their representatives for IACS-PC accounts now.
There is no need to register if you did not submit PQRI quality-measures data for 2007.
Key questions and answers about the registration process can be found on the CMS Web site.
Back to top
*****
Senate Finance Chair Baucus Looks to Move Forward With Bill That Would Halt Medicare Physician Payment Cuts
Senate Democrats plan to move forward with a bill (S 1951) that would reduce payments to Medicare Advantage (MA) plans as a means of offsetting the cost of delaying a mandated $10.6% cut in Medicare physicians' payments that's scheduled to take effect July 1.
The cost of the bill, sponsored by Senate Finance Committee Chair Max Baucus (D-MT), would total $18.2 billion over five years and would be financed through cuts to MA plans, which cost taxpayers more than traditional Medicare. The White House has threatened to veto any bill that makes cuts to these plans.
Last month, Senator Baucus ended negotiations with Senate Republicans on the bill. According to CQ Today, the bill "will almost certainly be blocked by GOP members, with the backing of the White House." Senate Republicans have proposed a $14.9 billion, five-year plan that would delay physician payment cuts for 18 months. The veto threat "will almost certainly force a compromise later this month," CQ Today predicts.
Interest groups and lawmakers are looking to include their own health policy provisions in the bill. Sen. Debbie Stabenow (D-MI) is pushing for a requirement that data collected by Medicare include information on race, sex and ethnicity. Legislators are also calling for an electronic prescribing provision, which is also supported by the National Association of Chain Drug Stores (NACDS). At the same time, NACDS is advocating for legislation that would increase Medicaid pharmacy reimbursement rates. In addition, Sens. Herb Kohl (D-WI) and Chuck Grassley (R-IA) are working to include a provision that would "crack down on nursing homes with records of abusing their patients or committing errors that led to injuries and deaths," according to CQ Today.
Back to top
*****
MedPAC Recommends Changes to Medicare Reimbursements for Primary-Care and Nursing Facilities; Also Considering a Pilot 'Medical Home' Program
The Medicare Payment Advisory Commission (MedPAC) recently voted to approve several recommendations to Congress focused on Medicare reimbursements for primary care and skilled nursing facilities and is considering a recommendation for a pilot 'Medical Home' program, according to CQ HeathBeat.
The commission recommended an increase in payments to primary care-focused physicians in an effort to address the growing shortage. Secretary of Health and Human Services, Mike Leavitt, will determine which physicians constitute primary care-focused practitioners.
The commission also recommended modifications to the Medicare payment system for skilled nursing facilities. These include adding a "separate nontherapy ancillary component" that includes prescription drugs and intravenous therapy, revisions to the therapy piece of the system to base reimbursements on "predicted patient care needs," and implementing a provision for "outlier payments" for unusual financial losses.
The commission also suggested a proposal under which Leavitt would require skilled nursing facilities to report diagnostic information, dates of services on claims filed and "services they furnish separately" on patient assessments.
Lastly, MedPAC is considering a recommendation that would establish a pilot program to provide Medicare beneficiaries with a 'medical home' to direct their care. The proposal would require physicians to competently provide primary care; coordinate services, utilize health care information technology; conduct care management; provide access and communication to patients; and maintain updated records of patients' advance directives, including the care they should receive if they should become incapacitated. The estimated three-year cost for the program is $400 million.
Back to top
*****
Senate Finance Chair Baucus Looks to Delay Medicare Physician Payment Cuts for 18 months
Senator Baucus (D-MT), Chairman of the Senate Finance Committee, recently met with representatives from several physicians’ groups to seek their support for a “modest” plan that would delay the pending Medicare physician pay cut to doctors.
Baucus is proposing to block the pending July 1 cut for 18 months and provide a 1.1% increase in doctor payments. First, lawmakers must agree on a way to offset that cost, Baucus told the group.
Back to top
*****
New MedPAC Report Recommends 1.1% Medicare Fee Hike for Physicians Next Year, Suggests Equalizing Traditional and Private Medicare Plan Payments
Congress should boost Medicare physician reimbursement 1.1% next year, the Medicare Payment Advisory Commission (MedPAC) advises in its March report to legislators. Legislators should also reduce payments to private Medicare health plans so they're aligned with those to traditional Medicare, the report urges.
Congress needs to act to prevent physician pay cuts triggered by Medicare's Sustainable Growth Rate (SGR) formula. The SGR, which mandates physician fee cuts whenever growth in outlays for these services exceeds growth in Gross Domestic Product, called for a 10.1% cut January 1. In December, Congress delayed the cut through June 30, substituting a 0.5% pay raise -- and setting the stage for a 10.6% reduction slated to take effect July 1.
The American Geriatrics Society and other organizations have campaigned successfully against SGR-mandated cuts for the last few years, and AGS continues to urge Congress to block the cut scheduled to kick in on the first of July.
AGS and other advocates of quality healthcare have also called on Congress to come up with an alternative to the SGR. This year, as last, however, MedPAC was unable to reach consensus on an alternative to the controversial formula.
In other news, legislation that Rep. Tom Price, MD (R - GA) introduced in the House last month would increase physician fees 1% for the last six months of 2008 and offer a 1.8% increase for 2009.
In its March report, MedPAC also calls for equalizing private payments to Medicare Advantage plans so they're aligned with average spending for traditional fee-for-service patients. Spending for Medicare beneficiaries in the private plans averages about 13% more than spending for patients in traditional fee-for-service Medicare plans, the report concludes.
MedPAC's new report also urges Congress to require the Department of Health and Human Services to make a confidential report to physicians comparing the services they and their peers provide to Medicare beneficiaries. The effort would go beyond the current Physician Quality Reporting Initiative.
In 2009, MedPAC's report also calls on Congress to:
- Boost hospital inpatient and outpatient services payments in keeping with estimated market price increases of 3% -- but use 1% to 2% of the hike for a hospital pay-for-performance program.
- Cut the indirect medical education adjustment -- payments to help teaching hospitals cover related costs - from 5.5% to 4.5%, and use the savings to fund a quality incentive payment program for these hospitals.
- Provide no payment updates for skilled nursing, home health care and inpatient rehabilitation services.
Back to top
*****
Doctors Seeing Fewer Medicare Patients Due to Payment Insecurities
Close to 25% of medical group practices responding to a recent national survey said they had either begun to limit the number of Medicare patients they treat or are not accepting any new Medicare patients due to uncertainty surrounding Medicare payment rates, according to Congressional Quarterly's HealthBeat.
Nearly half of the more than 1,000 practices responding to the Medical Group Management Association (MGMA) survey reported that a 10.6% cut in Medicare physician payments scheduled to take effect July 1 has lead them to stop accepting or limit the number of beneficiaries they accept. Half of the practices said they were considering reducing administrative and clinical staff and more than two-thirds indicated they would forgo or postpone investments in health information technology.
"The six-month adjustment to payments only served to create further uncertainty and administrative burden to practices already scrambling to shield themselves from additional payment cuts looming in 2009," said William F. Jessee, MGMA's president and CEO.
Congress voted in December to delay, for six months, a mandated 10.1% Medicare physician pay cut scheduled to take effect January 1 and to substitute a 0.5% increase -- setting the stage for the larger, 10.6%, cut slated to kick in July 1. Medicare's controversial Sustainable Growth Rate formula mandates cuts in Medicare payments to physicians when increases in these outlays exceed growth in Gross Domestic Product.
Congress' December vote to delay the pay cut followed sustained advocacy efforts - by the American Geriatrics Society, its members, and others - urging lawmakers to avert the cut. The Society plans further advocacy efforts aimed at blocking the July 1 cut and revamping the method by which Medicare payments to professionals are determined. Legislative aides are working on legislation that could halt the July 1 cut and stabilize Medicare physician payments for 18 months.
The 1,000 group practices responding to the survey represent more than 28,679 physicians.
Back to top
*****
In State of Union Message, President Calls on Congress to Propose Solutions to “Vital Problems” With Medicare, Other Entitlements
In his final State of the Union address last night, President Bush called on Congress to come up with solutions to “vital problems” with Medicare, Medicaid, and Social Security.
“Every member in this chamber knows that spending on entitlement programs -- like Social Security, Medicare and Medicaid -- is growing faster than we can afford,” the President said. “We all know the painful choices ahead if America stays on this path: massive tax increases, sudden and drastic cuts in benefits, and crippling deficits. I've laid out proposals to reform these programs. Now I ask members of Congress to offer your proposals and come up with a bipartisan solution to save these vital programs for our children and our grandchildren.”
The president had been expected to propose changes in the Medicare physician fee formula during the address. Instead, he called on Congress to take the lead in this area, and focused his address on the war in Iraq and, to a lesser extent, the troubled economy.
Back to top
*****
President Bush Likely to Propose Medicare Physician Fee Formula Change During Monday’s State of the Union Address
President Bush is expected to unveil a proposal for changing the Medicare physician fee formula during his State of the Union address this coming Monday. Congressional staffers and lobbyists say the plan “could significantly alter Capitol Hill discussion surrounding Medicare and other health-related issues,” CongressDaily reports.
In late December, President Bush signed Medicare legislation that, among other things, postponed for six months a mandated 10.1% cut in Medicare payments to physicians that was slated to take effect January 1. The legislation substituted a 0.5% increase for the cut. Medicare’s controversial Sustainable Growth Rate (SGR) formula, which mandated the 10.1% cut, lowers Medicare physician fees whenever increases in these expenditures outstrip growth in Gross Domestic Product. With the SGR still in place, Medicare physician fees are now slated for a 10.5% cut July 1.
Medicare trustees issued a “Medicare funding warning” in 2007, requiring the President, for the first time, to send a Medicare savings plan to Congress after he releases his fiscal year 2009 budget proposal. The trustees issue such warnings when they predict, for two consecutive years, that federal general fund revenue must be used to pay for 45% or more of total Medicare expenditures within seven years.
According to CongressDaily, legislators working on a Medicare package that would further delay the physician fee cut are awaiting details of the President’s proposal.
Back to top
*****
CMS Reopens Medicare Participation Decision Period for Additional 45 Days
Physicians who want to change their Medicare participation status in light of recent and potential changes in the Medicare physician fee schedule can do so until February 15, thanks to an extension of the Medicare participation decision period.
Following passage of recent legislation that both delayed the 10.1% Medicare physician fee cut that was slated to take effect January 1 and substituted a 0.5% fee increase through June 30, the Centers for Medicare and Medicaid (CMS) extended the participation decision period 45 days. The new deadline for changing, for example, from “participating” to “non-participating” or vice-versa, is February 15. Participation decisions will be retroactive to January 1.
Because lawmakers delayed the 10.1% cut for six months, Medicare physician fees are slated to drop 10.6% as of July 1. Congress plans to revisit the fee schedule, but it’s unclear what reforms legislators will ultimately approve. See related story.
AGS and other organizations, including the American Medical Association (AMA), will continue to advocate for a long-term solution to ongoing problems with the Medicare physician pay schedule. Medicare’s flawed Sustainable Growth Rate formula mandates cuts in Medicare physician fees when growth in these outlays outstrips growth in Gross Domestic Product. The AMA has posted additional information about the fee schedule and the extended Medicare participation decision period on its Web site.
Back to top
*****
Medicare Legislation Could Delay Physician Fee Cut For 18 Months, Giving Lawmakers Breathing Room to Draft Wider Reforms
Congressional aides are optimistic that they can draft a Medicare reform package that will delay a pending 10.6% Medicare physician fee cut -- slated to take effect July 1 -- for 18 months, Congressional Quarterly (CQ) reported this week.
Late last month Congress voted to delay a mandated 10.1% Medicare physician pay cut, scheduled to take effect January 1, for six months, and substituted a 0.5% increase -- setting the stage for the larger, 10.6%, cut slated to kick in July 1. Medicare's controversial Sustainable Growth Rate formula mandates cuts in Medicare payments to physicians when increases in these outlays exceed growth in Gross Domestic Product.
The 18-month delay would give legislators time to work on broader healthcare reform and is likely to be the "centerpiece" of a Medicare package that could cost $12 to $15 billion over five years, a Congressional aide told CQ. Lawmakers are concerned that, should Congress fail to block the 10.6% fee cut, doctors may stop seeing Medicare patients.
Although the Bush Administration appears to support a long-term fix, Republicans and the White House would still likely oppose cutting payments to private Medicare Advantage plans as a way to offset the costs of the 18-month delay. Many Democrats have argued that the government overpays Medicare Advantage plans, but the White House came out against cuts in payments to the plans during budget negotiations last month. More targeted cuts to the private plans are a possibility, however, according to CQ. Democrats may also try to rewrite rules concerning private Medicare plan marketing -- addressing concerns that the plans have been too aggressive in their efforts to get seniors to join.
Back to top
*****
Lawmakers Plan to Address Medicare Changes, including the Physician Fee Cut, in 2008
Lawmakers are planning to address the 10.1% Medicare physician fee cut slated to take effect June 30 and other potential changes to the Medicare program early this year.
"We want to explore Medicare changes that did not make it into last year's physician pay fix bill because time ran out," said Senate Finance Committee Chair Max Baucus (D-MT) and ranking member Chuck Grassley (R-IA).
In addition to the fee cut, Congress may turn its attention to health information technology requirements, and mental health parity and genetic nondiscrimination measures, all of which have the support of the President. Senate Finance may also try to rewrite rules concerning Medicare Advantage plan marketing.
"With health care emerging as a top issue with voters, the election year might put increased pressure on lawmakers to present at least a few new health policies," although some proposals could draw veto threats, according to CongressDaily.
Also in 2008, lawmakers plan to make changes to the State Children's Health Insurance Program (SCHIP) and the Medicaid program.
Back to top
*****
| 
