A bold pledge from the government's top healthcare administrator to resolve Medicare's physician payment problem has yet to convince all doctors that a permanent fix will ever be realized.
The American Medical Association's National Advocacy Conference in Washington began on a sour note last week when a 21.2% cut triggered by Medicare's sustainable growth-rate formula kicked in on March 1.
Although it was lifted by an emergency measure signed by President Barack Obama the following day, physicians were nevertheless angered by the fact that the measure—which provided a series of short-term extensions to various Medicare programs, including a 30-day stopgap on the SGR cut—fell woefully short of providing a long-term solution to this issue. (The temporary extension included healthcare subsidies for the recently unemployed under the Consolidated Omnibus Budget Reconciliation Act, commonly known as the COBRA health insurance law.)
Addressing AMA conferees, HHS Secretary Kathleen Sebelius agreed with doctors that the current formula was inadequate and promised to work with physicians to repeal the SGR. “We are committed to working with all of you on a permanent fix, so you don't have to spend your precious time coming to Washington” to lobby on behalf of this issue, she said.
Her powers as an administrator to help doctors are limited, however, and some in the medical community wonder how substantial this pledge was. “I believe her support is genuine,” says Joseph Stubbs, M.D., president of the American College of Physicians. “However, the pledge is somewhat empty in that the solution will have to come from Congress and specifically the Senate. While she may be supportive, until we hear voices from the Senate indicating movement for a solution to the SGR fix, we do not have a lot of renewed hope.”
Medicare's SGR formula for paying doctors is based on the economy's health and has threatened payment cuts to physicians every year since 2003. Congress has stepped in each time to enact a temporary fix so that doctors won't experience additional reductions to their Medicare payments, a move that only postpones the cuts and has resulted in SGR “debt” that's piled up into the billions over the years.
Federal actuaries and others have estimated it would cost $210 billion to $230 billion over 10 years to permanently repeal the SGR.
It's a formula that has to be done away with, says Thomas Eppes, M.D., a member of the AMA and a family physician in Forest, Va. “It's the only way to pay doctors fairly to take care of their patients,” he said.
The Senate has historically been the place where SGR reform has gone to die. While the House managed to approve a bill last year that sets in place a permanent fix, similar attempts have failed in the Senate, mainly over arguments that the fix would not be paid for. The latest extensions bill, which provided that 30-day reprieve for doctors, was also held up in the Senate because of partisan squabbling and parliamentary maneuvers.
Some physician leaders say Sebelius could make a dent with Congress—the Senate in particular. “During this one-month delay of the 21% payment cut we encourage administration officials to share with the U.S. Senate the urgent need for repeal of the formula, which hurts seniors, military families and the dedicated physicians working to provide high-quality care,” the AMA's president, J. James Rohack, M.D., says in an e-mail.
Sebelius “certainly has the authority to point out the impact on physicians,” says Lori Heim, M.D., president of the American Academy of Family Physicians, who met last week with Sebelius in a private meeting. Heim says she believes Sebelius is committed to fixing the SGR, and “she could advocate for it to keep the pressure on Congress.”
The SGR problem is an inconvenience for the Obama administration as well as doctors, Heim adds. The latest 21.2% cut, for example, put the CMS “in a very difficult position.” To prevent doctors from experiencing that cut, the CMS had to freeze payments for 10 days, Heim says.
Patrick Smith, senior vice president of government affairs with the Medical Group Management Association, says Sebelius' pledge “reflects the conversations that we have continued to have with the White House throughout this extended process.”
Previous Obama administration statements and actions, such as removing physician-administered drugs from the SGR formula and including the full cost of the repeal in its budget submission to Congress, “demonstrates its commitment, and we look forward to its help as we continue our campaign to convince Congress that this is the time for permanent repeal of the SGR formula,” Smith says.
A longer-term fix to the SGR may be in the works provided that the Senate approves a more comprehensive tax extenders bill than the one it passed last week. This bill, which would stave off physician payments until Oct. 1, would also extend COBRA premium subsidies and unemployment insurance provisions, plus a federal increase in Medicaid payment. At deadline, no date for a vote on final passage had been set.
Heim says the timing of this latest fix may prove to be a problem. What physicians want is a permanent fix to the SGR. The expiration of this seven-month fix would come up just before the November elections, and it's unlikely that lawmakers are going to want to address such an expensive problem when their jobs are on the line, she says.
To Michael Migliori, M.D., an ophthalmologist in Providence, R.I., whose practice is 60% Medicare, any temporary fix, whether it's 30 days or six months, just “kicks the can farther down the road.” The inability to arrive at a permanent solution “is the dysfunction of Congress, of two political parties who refuse to cooperate with one another, holding 600,000 doctors hostage,” he says.
Other providers are heartened by the jobs provisions in the latest tax extenders bill. The American Hospital Association supports the bill's provision to extend COBRA through Dec. 31 of this year. The provision is important “because it ensures access to coverage for those who are unemployed,” says Elizabeth Lietz, an AHA spokeswoman.
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