Physician groups representing otolaryngologists have ambitious 2011 policy and legislative agendas that include pushing for replacement of the Medicare physician payment formula and helping to shape health reform’s implementation.
Explore this issue:January 2011
Medicare physician payment tops the to-do list. In late November, Congress passed a one-month reprieve from a 23 percent Medicare reimbursement cut that was scheduled to hit on Dec. 1. Then in early December, lawmakers approved a $19.2 billion, one-year freeze that prevented a 25 percent cut from kicking in on Jan. 1, 2011. President Obama signed the legislation into law on Dec. 15.
Although a 12-month stay is not ideal, it will give lawmakers time to pass a permanent replacement for the flawed reimbursement formula, said Kristen Hedstrom, American College of Surgeons (ACS) assistant director of legislative affairs. The formula “has been unsustainable for more than a decade now, so something has to be done,” said Pete Batra, MD, associate professor and co-director of the Comprehensive Skull Base Program at the University of Texas Southwestern Medical Center at Dallas.
A one-year fix should also prevent physician Medicare pay from becoming a political pawn in the early part of the new congressional session, Hedstrom said. Some Washington observers speculate that House Republicans might offer a bill that would finance a Medicare reimbursement solution with the repeal of the health reform law’s individual mandate and its accompanying subsidies for low-income Americans. The vote would be a political maneuver, however, because such legislation would likely fail in the Democrat-led Senate. Even if a bill were to pass, President Obama would veto it. A one-year fix would take such tactics off the table for now.
Although medical societies will push to replace the formula with a system that accurately reflects increases in the cost of practicing medicine, they realize it will be a hard sell. Freezing Medicare payment through 2020 would cost $275.8 billion, while providing a payment update that reflects the Medicare Economic Index would cost $329.9 billion, and a 2 percent annual update would cost $374.2 billion, the Congressional Budget Office estimates.
Lawmakers will have a hard time finding the money, Hedstrom said. “In order to get it, you have to cut something. What do you cut?” The Republican takeover in the House and its gains in the Senate intensify the funding question. “Many of the Republicans who won in November ran on no new taxes and reducing the deficit, so paying for a permanent fix will be extremely difficult within these parameters,” Hedstrom said.
But doctors remain hopeful. One positive sign: Lawmakers on both sides of the aisle recognize that the payment problem must be addressed, said Paul Imber, DO, chair of the American Academy of Otolaryngology-Head and Neck Surgery (AAO-HNS) Board of Governors Legislative Representatives Committee. He noted that the Senate voted unanimously to pass the one-month payment reprieve. “That’s bipartisan. It crosses all barriers,” he said.
The public, too, is aware of the problem. An AARP survey released in October 2010 found that 81 percent of its members who are enrolled in Medicare and 86 percent of those not yet eligible for Medicare were concerned about the impact the pay cut could have on physician access.
The public’s concern could motivate Congress to act, Dr. Imber said. “A good number of physicians will restrict the access of Medicare patients to their practices if things continue the way they are, so things have to be fixed.”
A May 2010 American Medical Association survey of 9,000 doctors found that 17 percent of physicians are already restricting the number of Medicare patients served by their practices. When asked how they’d cope with a 21 percent cut, more than half said they’d limit the number of Medicare patients they’d treat.
Also on the Medicare front, many physician groups plan to continue their opposition to the Independent Payment Advisory Board (IPAB) created by the health reform law, called the Patient Protection and Affordable Care Act (ACA). The 15-member board is appointed by the President and confirmed by the Senate. If expenditures are expected to exceed the target growth rates set by the law for Medicare, the IPAB must recommend proposals to reduce spending. The IPAB cannot submit proposals that would ration care, increase taxes, change Medicare benefits or eligibility, increase beneficiary premiums and cost-sharing requirements, or reduce low-income Part D subsidies. Through 2019, the board is prohibited from recommending payment cuts to providers, primarily hospitals and hospices, that are already slated for reductions. The IPAB may propose physician payment cuts, however, and this worries doctors.
The Department of Health and Human Services must implement IPAB proposals unless Congress adopts an alternative with equal savings. Although lawmakers can override the board, “it becomes a very political situation,” Dr. Imber said. “To have this independent board is very scary. It needs to go.”
House Republicans may take a stab at getting rid of IPAB, but such a measure would likely fail in the Senate, and President Obama is opposed to the board’s repeal, Hedstrom said. The first set of IPAB recommendations isn’t due until 2014, well after the presidential election in 2012. So the ACS, while opposed to the board, is in a wait-and-see mode while it focuses on ACA issues that come up sooner, she said.
Two other items on the ACS agenda are accountable care organizations (ACOs) and the national bundled physician-hospital payment pilot program in Medicare. The ACS is working on principles and guidelines so that it can weigh in with official comments during the regulation-making process, Hedstrom said. “We want these alternative payment models to be patient-centered, to be physician-led and to be quality-driven,” she added.
The health care law aims to change the way services are paid for, from reimbursement based on quantity to reimbursement based on quality and efficiency, Dr. Batra said. “Otolaryngologists have to be cognizant of what kind of changes are going to be coming, because it’s going to completely change the way health care is delivered,” he said.
Many physician groups will continue to press for comprehensive tort reform that includes a $250,000 cap on noneconomic damages. Such legislation could pass in the GOP-controlled House but is expected to fail in the Senate. In this time of budget and deficit crises, however, tort reform with a cap on noneconomic damages becomes more attractive, Dr. Imber said, because it would produce billions in savings each year by reducing defensive medicine.
The ACS will continue to press for tort reform with a noneconomic damages cap, but it is also open to exploring other reforms, such as health courts and safe harbors for doctors who follow evidence-based treatment guidelines, Hedstrom said, although these ideas have yet to be tested.
Meanwhile, other AAO-HNS priorities include:
- Continuing to fight federal legislation that would give audiologists direct access to Medicare patients;
- Pressing for federal “truth in advertising” legislation that requires non-physician health professionals to make their education and training clear in advertising materials and in their dealings with patients; and
- Maintaining federal funding for early hearing detection and intervention programs.
The organization’s stances on audiologists’ access to Medicare patients and on truth in advertising are about patient safety, Dr. Imber said. “We don’t want people getting hurt,” he said.
A May 2010 AMA survey of 9,000 doctors found that 17 percent of physicians are already restricting the number of Medicare patients served by their practices.