Weighing the options
Results unclear in plans for doc payment system
An overhaul of the Medicare physician payment system is again on Congress’ agenda, but it remains unclear as ever whether the latest efforts will produce any results.
Rep. Allyson Schwartz (D-PA.) caught the attention of healthcare providers when she introduced on May 9 the most detailed plan to date for scrapping the Medicare sustainable growth-rate formula. The following day, the senior Senate Democrat with oversight powers over Medicare asked four former Medicare administrators to produce an overhaul proposal within a month.
Both initiatives drew praise from leading provider advocates for highlighting the need to replace the Medicare physician fee schedule, which has required a series of last-minute patches to prevent steep cuts in recent years. But as the largest physician rate cut ever required by the Medicare formula looms in January, the lobbyists said neither effort was the breakthrough needed to finally resolve the issue.
The Schwartz bill would freeze rates at their
“It will not be done, not between now and Dec. 31.” —Rep. Phil Gingrey (R-GA.)
current levels; provide small increases for certain providers for several years; and direct the CMS to develop at least four replacement payment options by Oct. 1, 2016. A replacement system would begin in 2018.
That framework for gradually implementing a carefully considered replacement payment system drew praise from provider advocates.
“Stabilizing physician reimbursements for several years while new payment and delivery models are tested will provide needed certainty for physician practices,” Dr. William Zoghbi, president of the American College of Cardiology, said in a written statement. The Schwartz bill garnered initial support from Zoghbi’s group and 14 other provider organizations.
But the legislation also was notable for the lack of endorsements—at least initially—from many of the most powerful provider advocates in Washington, such as the American Hospital Association and the American Medical Association. Officials from those organizations did not rule out possible future endorsements.
One healthcare lobbyist whose organization did not back the bill criticized the severity of the penalties it included for providers who fail to transition from a feefor-service system to the as-yet unknown replacement system in future years.
Another strike against the measure was that its support from other members of Congress was limited to first-term Rep. Joe Heck (R-nev.), a physician trained in emergency medicine.
Senior Republicans who have taken the lead for their party on the issue in the House of Representatives said they were unfamiliar with Schwartz’s bill and indicated their focus remains on their own efforts to repeal the Medicare physician payment system.
Rep. Phil Gingrey (R-GA.), a physician and co-chairman of the 21-member GOP Doctors Caucus, said in an interview that his group is in discussions on an SGR replacement plan with the AARP and Sens. John Barrasso (R-wyo.) and Tom Coburn (R-okla.), also physicians.
“It will not be done, not between now and Dec. 31,” he said. “It will be in” the next Congress. The group aims to have a deal on replacing the physician payment system within 2013.
Another mark against the Schwartz bill is that the method it uses to offset the cost of scrapping the current payment system—counting savings from the end of the Iraq War—is staunchly opposed by members of overall Republican leadership, who view such savings as applicable only to deficit reduction.
The Senate effort by Sen. Max Baucus (D-mont.), Finance Committee chairman, also has an unclear future. He directed four former administrators of the CMS and its predecessor agency—gail Wilensky, Bruce Vladeck, Thomas Scully and Dr. Mark Mcclellan—to develop both a short-term and long-term “fix” for Medicare’s physician payment system.
Wilensky said later in an interview that she was uncertain whether the four, who worked for both Republican and Democratic presidents, would find the common ground to provide united recommendations.
Even if they are successful in that effort, Baucus told reporters he would not commit to putting into legislative language either the former administrators’ recommendation or his own SGR replacement plan.
Baucus said he was unaware of the Schwartz bill.
Although neither the Baucus nor the Schwartz initiatives may result directly in laws overturning the physician payment formula, provider lobbyists said, they could establish some of the building blocks for a possible deal during an expected lame duck legislative session after the November election.
Provider advocates also said they continue to hope that massive must-pass tax cut extensions will sweep up a physician payment overhaul in the dying days of the current Congress. “Who knows what it will look like,” one said, “but we need this to be part of it.”