Thursday, November 11, 2010

Do I hear someone kicking a can?

Robert Lowes, in Medscape Medical News (sorry, password protected) reminds us:

Physicians face a 23% cut in Medicare rates on December 1 and another on January 1 that pushes the total to roughly 25%. Both are triggered by the controversial sustainable growth rate (SGR) formula that Medicare uses to set physician pay. Put simply, the reductions represent the program's attempt to collect several hundred billion dollars that it has overpaid physicians since 2002. This debt has built up because every year Congress has postponed SGR-mandated reductions. The cost of merely freezing current Medicare rates through 2020 as opposed to cutting them as planned would amount to $276 billion, according to the Congressional Budget Office.

Kaiser Health News says:

If Congress fails to overturn the cuts this time, doctors could reconsider taking new Medicare patients* or change how they participate with the program, (AMA President) Wilson warned in an interview with Kaiser Health News. "What we're saying to them and what we want seniors to say to them is, 'You're threatening our access to care. If physicians cannot keep their doors open because Medicare now only pays about half the direct cost of running a practice, then we're going to lose access to care,'" Wilson told Kaiser.

Another article notes,

The AMA is campaigning for a 13-month extension, rather than a shorter extension until Congress reconvenes next year, taking advantage of the completely Democratic Congress. The Democrats will put the cuts on the legislative agenda this month.

Of course, the trade organizations for every physician group are also at work on the issue, from optometrists to family practice doctors to hematologists.

Most people think that Congress will just kick the can down the road a bit more with a short-term postponement. Why? Because a permanent fix would bust the federal budget rules. A reminder, too: The Congressional Budget Office analysis of the recently passed health care bill assumed that this reimbursement reduction would go ahead as planned.

I don't know what long-term fix will be used for this problem. Thoughtful observers like BU's Austin Frakt have come up with proposals, but such plans are unlikely to be adopted during a lame-duck session.

* I do not believe this option is open to private practice doctors in Massachusetts. Can someone validate that for me? In any event, though, hospitals and doctors working in hospitals cannot exercise this option.


Thomas Pane, M.D. said...

As I understand it, Massachusetts doctors cannot charge a Medicare patient more than the fee schedule amount, regardless of the physician's participatory status in Medicare. I don't think they are actually required by law to accept Medicare patients (yet).

This law raises a lot of interesting debate points regarding government influence on private transactions, health care, and licensing.

See page 32 here:

Anonymous said...

I honestly don't recall all of this but a couple of years ago, Mayo Clinic stopped accepting certain types of Medicare patients because of the reimbursement rate. Is this something that is likely to take place in your institution? If so, then what?
Also, what are medicare patients to do. They are often some of the most vulnerable either from being of age or disabled patients and now making it more difficult to get care.

Anonymous said...


Unknown said...

Many years ago, I worked for a very prescient hospital CEO. His mantra to the medical staff back in the 1990s was "if you don't take control of your own destiny, someone else will." Well, he was right and physicians to this day refuse to an active roll to manage their profession based on rapidly changing events. For the last decade, the call for outcomes has been loud. Why in heaven's name haven't practicing physicians (not the ham-strung AMA) taken heed? Greed!

Anonymous said...

In February at "The Healthcare Summit" all parties agreed that Waste, Fraud and Abuse costs were $1 out of every $3 spent 33.3%].

Evidently someone thinks that Physicians are either responsible for most of this [25% in cuts] or that by cutting 25% that the physicians can cause these problems to be solved, or not!

Business that doesn't cover costs and make profits can't be afforded by many, or visits and/or services will be extended or dropped.

Anonymous said...

I wish Congress would listen to the people who are engaging in actual cerebral activity over this problem, as opposed to jerking their knees.

Your referenced article by Austin Frakt has a thought:

"Aligning payment incentives with quality and not quantity will strike at the heart of the cost growth problem. Also high on the list should be reducing payments to specialists and increasing those for primary care physicians."

As does the Newsweek article he cites about specialists:

"{Dr. Howard} Brody recently proposed, in The New England Journal of Medicine, that every medical specialty identify five procedures—diagnostic or therapeutic—that are done a lot and cost a lot but provide no benefits to some or all of the patients who receive them......
Medical groups have not exactly beaten a path to Brody's door, so NEWSWEEK contacted several to see if they would play along. Reactions ranged from "we do no unnecessary care" (dermatology) to "only five?!" (emergency medicine)."

Note the key phrase: Medical groups have not exactly beaten a path to Brody's door.

Wake up, doctors, and be a part of the solution instead of part of the problem.

nonlocal MD

Anonymous said...

Paul - A little history here.... this was a deal cut by Obama and the American Medical Association. The AMA would support Obamacare and he would reverse scheduled Medicare cuts. The kicker, of course, was he couldn't include the fix in his Obamacare bill because it would have added billions in cost to his bill and made it way too expensive. So they said they would do the fix in a seperate bill so they can still get on their soapbox and pretend Obamacare doesn't add to our trillions in debt. This is just a perfect example of everything wrong with politics and why this country is heading quickly towards bankruptcy. No transparency on cost and dealing straight with the American public.

Anonymous said...

I don't necessarily disagree with physician reimbursement cuts; but I think the cuts should be done for certain high paid specialties (and yes, I'm an MD). For example, why do proceduralists, surgical subspecialties, etc get paid so much as compared to the more "cerebral specialties (neurology, endocrine, infectious disease, nephrology) get paid a fraction? Why does a dermatologist, who rarely would have to drive in to a hospital when on call, has great hours, and arguably doesn't take care of a very sick patient population, get paid as much as they do? The pay is very skewed, and that's where a lot of money is wasted. I think the large gap pay between different physicians needs to close- but why would an opthalmologist or GI doc want to give up their $800K salary? of course they wouldn't!!

And what's the argument for them getting paid more- they train longer? Their patients are sicker? More complex care? None of the above- the average medical specialty fellowship is now 2-4 years, therefore a typical endocrinologist, ID doc, or pulmonologist spends approximately 5-7 years of post graduate training. This is the same amount of time as a radiologist, dermatologist, ophthalmologist, or orthopedic surgeon. I'd like any MD to argue that the urologist takes care of sicker patients on average than the nephrologist- same organ system, pay difference 2-3x.

So while many physicians are upset about the pay cut, the ones really getting hurt are the ones at the bottom- the ones at the top are now going to make 600K instead of 800K, what a paycut….

Definitely, the system needs a large overhaul.

Anonymous said...

The docs themselves cannot agree; in a survey in 2009 (source below), 4/5 agreed that Medicare pays too much for some procedures and too little for others. The highest consensus on a reform proposal was for financial incentives for quality, 49%. (Perhaps because they saw what happened in the UK where physicians cleaned up on that score?)
Only 17% supported bundled payments per episode of care.

Since bundling is the favored method of federal and state governments, there is a clear perception gap here.