ACP American College of Physicians - Internal Medicine - Doctors for Adults

Will the House reform bill reduce health care costs?

The House of Representatives is poised to vote, as early as Saturday, on H.R. 3962, the Affordable Health Care for America Act. Passage of the bill would be a historic milestone. At no other time in American history, has either the House or Senate passed legislation to extend health insurance coverage to (almost) all Americans.

Of course, like other milestones, there are many more miles to travel before health care reform legislation becomes law. The Senate leadership has yet to figure out how to combine and modify the Senate Finance Committee and Health, Education and Labor and Pensions Committee into a single bill that can get 60 votes. And then the House and Senate would have to reach agreement on what likely will be very major differences between the two versions, and when they do, another vote would have to take place in both chambers before it becomes law.

H.R. 3962 is closely aligned with ACP policies on coverage, workforce, and payment and delivery system. On November 2, ACP sent a letter of support to the House leadership that details the dozens of provisions in the bill that merit ACP's support.

Of course, critics are doing what they can to derail the bill. One unfortunate tactic is the resurfacing of a chain email, about the earlier H.R. 3200, that has been discredited by two independent fact-check organizations. A new partisan critique of the bill repeats several of the same false claims, according to a new analysis from Politifact.com.

On a more substantive basis, the bill is getting criticized for not doing enough to control costs.

But as Timothy Jost blogs in Health Affairs, H.R. 3962 actually includes many policies that "will in fact work important changes in the American health care system" to improve health care delivery and lower costs. Among them: accelerated pilot tests of medical homes and accountable care organizations, increased payments for primary care, quality and efficiency incentives for Medicare Advantage plans, comparative effectiveness research, promotion of shared decision-making, gainsharing, reporting on infections acquired in hospitals and ambulatory surgical centers, and workforce initiatives to increase the numbers of primary care physicians

I keep hoping that we can get to the point where there is a substantive debate on whether the bills do too much or too little to control costs; have too much or too little regulation; or spend too much or too little to make coverage affordable. The critics can surely do better than relying on discredited falsehoods, like the one that claims that H.R. 3962 would prohibit people from buying private insurance, to make their case.

Today's question: Do you think the House bill begins to put in place the right policies to expand coverage and control costs?

posted by BDoherty at 3:06 PM   6 Comments

My rockin' the U.S.A tour

Twenty-one days on the road and 17,200 miles travelled since Labor Day.

Stops in Wichita, Kansas; Lead, South Dakota; Osage Beach, Missouri; Charleston, South Carolina, Phoenix, Arizona; Winston-Salem, North Carolina; Stowe, Vermont; and Rochester, Minnesota. Coming up next: 4000 miles and four days in Houston, Texas, followed shortly by a return to the Lone Star state, and then Sacramento, California. Upcoming early next year: Las Vegas, Nevada; Tyson's Corner, Virginia; and Hattiesburg, Mississippi.

No, this isn't the itinerary for Bruce Springsteen and the E Street Band. It is what I have been doing since Labor Day, meeting with physicians, mainly at ACP chapter meetings, to talk about health care reform.

Keeping in mind Will Roger's truism that "This country has come to feel the same when Congress is in session as when the baby gets hold of a hammer" shouldn't I instead remain in Washington, keeping an eye on Congress? Well, no. Although my job is to represent the interests of internists in Washington, D.C., I feel that I can't do that effectively if I don't spend time meeting with internists. We have a top-notch advocacy staff in D.C. that keeps me informed about everything, and modern technology allows me to be a mouse click from being (virtually) on the scene.

I mention all of this because some commentators on this blog have taken me and ACP to task for not listening to its members. I don't take it personally or defensively, but I doubt that there is anyone else who has listened to as many internists, in as many different places, as I have in the past three months.

What have I learned? First, I have not encountered a single instance of an ACP member reacting with "town hall" style hostility to my explanations of the ACP's views on health reform. This is not to say I found uniformity; internists, like the American people generally, have a wide and diverse range of views.

Like the young Med-Ped physician who I met with in South Dakota, who believes with all of his heart and soul that the current bills will lead to a loss of liberty, crushing taxes and debt, and government rationing of services. Like the ACP member in Vermont, who believes with all of his heart and soul that only a government-financed, not-for-profit, single payer system can provide Americans with equitable and affordable care. These ACP members, and many like them, are at polar opposites on the political spectrum, yet they expressed their views to me with civility and with a high degree respect for the ACP.

Internists' views also differ depending on where they live, but not as much as one might expect. Physicians in "red states" like Kansas and South Carolina are more likely to be concerned about the plans being developed in Washington, and those in "blue" states like Minnesota and Vermont are more likely to support them. But you find a range in all regions. In Charleston, SC, for instance, the first question to me came from a conservative doctor who was concerned that ACP was in favor of "government-run" health care, while the very next question was from a single payer proponent.

The most common sentiments I've encountered are confusion about what is in the bills; general agreement with ACP's views; hopefulness that the reforms will improve things; and anxiety that they could make things worse. To address the confusion, ACP continues to update its resources for ACP members, including a new snapshot tool that compares the new House health reform bill with ACP policies.

I have come away from my travels encouraged that most internists want health care reform, and that they place a high degree of confidence and trust in the ACP to do the right thing, an obligation I take very seriously. I am committed to continuing my efforts to listen to as many internists as possible, but even though I am listening, it doesn't mean I will always agree with you.

Today's question: Do you feel that there is "common ground" in internists' views on health care reform and of ACP?

posted by BDoherty at 4:00 PM   11 Comments

Who wins from the House reform bill? Follow the money and find out.

Estimates by the Congressional Budget Office of how legislation affects the federal budget can tell a lot about Congress' priorities. Provisions in bills relating to specific health care sectors (e.g. physicians, hospitals, drug manufacturers, insurers) that the CBO scores as producing "savings" means that that particular sector is going to be hit with payment reductions or tax increases to fund other priorities in the bill. Provisions scored by the CBO as adding to federal budget expenditures means that the bill's sponsors have decided that the affected sector is a priority deserving of more federal dollars.

What does the CBO's preliminary estimate of the new House health reform bill tell us about Congress' priorities? That primary care and prevention are the sectors that Congress has identified as deserving as more federal spending, above all others, and that insurance companies in the Medicare Advantage program is the sector that will take the biggest hit. Other sectors facing steep reductions are hospitals (reduction in their market basket increase and disproportionate share payments), drug companies and home health agencies.

In fact, primary care physicians get the single largest bump in spending of any sector in the entire bill. Here is how:
$ 57 billion more will be spent over the next 10 years to increase Medicaid payments to primary care physicians so that they equal the Medicare rates. This is more than any other sector of providers, suppliers and health professionals will get, bar none.
$ 4.7 billion more will be spent to increase Medicare payments to primary care physicians for office, hospital, nursing home, home and emergency room visits.
$ 2.3 billion more will be spent to fund two Medicare and Medicaid pilots to reimburse primary care physicians for care coordination in a Patient-Centered Medical Home.
$ 1.5 billion more will be spent on Medicare GME, much of it directed at increasing primary care training.

Prevention and wellness programs will also get tens of billions in additional federal spending. The bill creates a $34 billion trust to fund public health investments in wellness and prevention, and another $10.7 billion to fund coverage of preventive services under Medicaid.

Now, I know that many of the regular commentators for this blog will respond with a shrug to the increased spending on primary and preventive care, because they will say that it is not enough to prevent a catastrophic shortage of primary care physicians. And they will have a point: I don't think the policies in this bill, by themselves, will suddenly result in thousands of more medical students choosing primary care, or necessarily persuade those in practice that there is a brighter future ahead, but I do believe that they begin to put in place programs that will help. Still, it is undeniable that the Congress has decided that primary care and prevention are priorities that deserve a lot more money: the combined $100 billion that the House proposes to spend directly on primary care, prevention and wellness over the next decade represents more than 10% of the bill's total net cost of $894 billion. The fact that primary care is now viewed as a top priority also is evidenced by introduction today of a bill, supported by the House leadership, that would repeal the Medicare sustainable growth rate and replace it with a new update system that will allow payments for primary care and preventive services to grow at a faster rate than all other services.

By any standard, a combined expenditure of almost $100 billion on primary care, prevention and wellness represents a huge shift in the priorities of the federal government, and one that I think deserves our recognition and support.

Today's question: What do you think the increased spending on primary care and prevention could mean to internists and their patients?

posted by BDoherty at 4:57 PM   7 Comments

Revised House bill would expand Medicaid, offer public option, cover 96%, and lower the deficit

Today, Speaker of the House Nancy Pelosi (D-CA) released a new version of the health care reform legislation that is derived from an earlier bill (H.R. 3200) approved by the House's three health committees. I am still making my way through the bill, so will have more to say about it in future posts. As reported in The Washington Post, the bill is likely to attract broad support among Democrats but no Republican votes.

The biggest difference with H.R. 3200 is that the bill expands Medicaid to all persons up to 150 percent of the federal poverty level, instead of 133% in the earlier bill. Medicaid, once the poor sister of the popular Medicare program, would now be the single largest source of health insurance in the United States. To increase physician participation in Medicaid, the bill would increase Medicaid payments to primary care physicians over several years until they at least equal Medicare pay rates in all states.

It is also substantially less expensive than H.R. 3200, with an estimated cost of less than $900 billion over 10 years, according to the CBO, and would reduce the deficit by $104 billion over the same ten years. One reason that the cost has gone down is that it is cheaper to enroll people in Medicaid than to offer them subsidies to buy private health insurance coverage. It also removes the cost of repealing the Medicare SGR physician pay formula from the legislation; instead, the House leadership has introduced a separate bill that would repeal the SGR and create two separate spending targets, a higher one for evaluation and management and preventives services, and a lower one for all other services, although both categories would be allowed to grow faster than under the current SGR. How the House plans to move the SGR bill outside of health reform legislation remains to be seen.

The bill includes a permanent 5% Medicare bonus for office and hospital visits provided by primary care physicians, 10% in health professional shortage areas. There would be a modest expansion of graduate medical education (GME) training positions for primary care, and new and expanded loan repayment for primary care clinicians who satisfy a service obligation.

And, on the public plan, the new bill would offer individuals who qualify for subsidized coverage the ability to enroll in a government-administered plan that would negotiate its payment rates with physicians and hospitals instead of using the Medicare rates.

Today's question: What is your initial reaction to the new health reform bill?

posted by BDoherty at 4:35 PM   3 Comments

The Public Plan Rorschach Test

The idea of offering people the option of enrolling in a public plan, similar to Medicare, has become the Rorschach test for health reform. Many conservatives see it as a foot-in-the-door that will lead to government-run, socialized medicine. Many liberals see it the same way, as the first step to achieving a single payer system, although fewer will admit to it.

If you distrust and dislike insurance companies, you like the public plan. If you distrust and dislike government, you despise it.

Then there are the deal-makers, the people in Congress who have to find a way to bridge these differences so that they can get a majority in the House and a 60 vote super-majority in the Senate. For them, the policy is less important than the votes they need to pass a bill. They are the ones who dream up things like "triggers", so the public plan would only go into effect if private insurers don't cover enough people and keep costs under control, or state opt-out or opt-ins, so each state could decide whether or not to participate. The deal-makers also have to decide if they will get more votes by having a "robust" public option (meaning that it would pay doctors or hospitals based on the Medicare rates), as the liberals insist, or whether it would use negotiated rates, as many of the "centrists" prefer.

The Hill newspaper is reporting that Speaker Nancy Pelosi (D-CA) will be unveiling an agreement tomorrow to have a public plan option that would use negotiated rates instead of Medicare. Last week Senator Majority Leader Harry Reid (D-NV) announced that the Senate bill will have a public plan with a state opt-out.

But one way or another, the public plan has come back from the dead, as captured in this Halloween illustration brought to us by The Washington Post cartoonist Tom Toles.

The scary thing about the public plan though, may be what it doesn't do, as Fred Hiatt, writes in The Washington Post. He argues that the public plan allows the politicians to pretend they are controlling health care costs while for the most part ducking the issue. Robert Samuelson, also writing for The Post, makes a similar argument, that the debate of the public plan allows Congress to "fake it" when it comes to controlling costs.

I see the public plan in the similar fashion as they do. Although the public plan has become the defining issue for many, I think there is a lot less to it than meets the eye. Depending on how it is structured, it could do some good in introducing some needed competition to the insurance industry, but I hardly believe that its inclusion or not is going to make or break health care reform. Especially since the deal-makers likely will water it down so much it won't have that much negotiating clout in the market.

Today's question: How important do you believe the public option is to health care reform?

posted by BDoherty at 4:18 PM   5 Comments

Coming soon! Medicare Part E!

The Hill reports that the House Democratic leadership has decided to rebrand the "public option" as Medicare Part E, that is, Medicare for everyone. But are they really proposing that everyone should be able to enroll in Medicare, fulfilling the wildest hopes of single payer advocates?

Not likely. The House's version of Medicare Part E could more aptly be labeled as the Medicare Part UPWDNHATAEHCAWDNQFMOS program , standing for Uninsured Persons Who Do Not Have Access To Affordable Employer Based Health Coverage And Who Do Not Qualify For Medicaid Or SCHIP. Barring a complete re-write of the House bill, the re-branded public plan option would be available only to the 30 million or so people who fall in the UPWDNHATAEHCAWDNQFMOS category and are eligible to receive federal subsidies to buy coverage through a health alliance. Calling it Medicare for Everyone doesn't make it so.

Still, it might be a very good political move. People like Medicare and don't associate it with "government run" health care (remember the reports of seniors at the August town hall meetings screaming "keep government out of my Medicare?").

The Hill also reports that the plan will be "the 'robust' option or 'Medicare Plus 5' in the jargon that has emerged on Capitol Hill, [which] ties provider reimbursement rates to Medicare, adding 5 percent."

The American College of Physicians has said that it could be appropriate for people eligible for the health exchanges to have the option of choosing either a qualified private insurance plan or a public health plan, provided that the public option is funded through premiums and is not tied to Medicare physician participation agreements or Medicare rates. ACP wrote:

"Proposals to use the current Medicare reimbursement structure as a basis for reimbursement under the public plan option raise significant concerns. In particular, payment levels for physicians participating in the public plan would amount to price controls that insufficiently compensate physicians for their work. It is widely believed that the current Medicare fee schedule is ineffective in promoting quality care and incentivizes volume-based rather than value based health care. In its March 2009 report to Congress, MedPAC stated that it was dissatisfied with the current fee schedule updating mechanism for physician payments. Further, the Medicare fee schedule has resulted in improper utilization of services rather than cost containment. Proponents of the public plan option have cautioned that hospital closures, stifled innovation of new technology, and limited access to physician services could result if a government-run health plan strictly limits payments to providers under a public plan ... To be successful, a public health plan would not have to control prices to maintain access, promote quality care, and limit cost efficiencies ... Instead, the government (or the plan's administrator) should negotiate with providers in a manner similar to the private market."

Especially given the Senate's failure yesterday to repeal the Medicare Sustainable Growth Rate (SGR) formula, it doesn't make sense to build the new Medicare E program on a payment structure that Congress itself knows doesn't work and would require that they close a $240 billion budget shortfall to stop the scheduled physician pay cuts. The same payment structure that Congress acknowledges undervalues primary care and rewards volume over value. Yet Speaker Pelosi wants the flawed Medicare fee schedule to be the foundation for the new public option?

My guess is that the decision to base the public plan on the Medicare rates is principally a negotiating tactic in anticipation of a conference committee with the Senate, which is not likely to include a "robust" public option in its bill. A compromise might be to accept the House's proposal for public plan option, but to divorce it from the Medicare rates and instead allow the public plan to negotiate rates with physicians, hospitals and other providers. Yet in one form or another, it seems more likely than ever that some kind of public option will end up in the final bill. Call it Medicare E if you want, even though most of us will not have access to it.

Today's questions: What do you think about re-branding the public option as Medicare Part E? Should it pay physicians and hospitals based on the Medicare rates (plus 5%) or should the rates be negotiated?

posted by BDoherty at 1:29 PM   9 Comments

Congress again fails to end the SGR lunacy

Just a few days ago, it looked like Congress might actually do the right thing and end the annual cycle of enacting short-term measures to stop Medicare payment cuts caused by the Sustainable Growth Rate (SGR) formula, only making the problem harder and more expensive to fix the next time around.

But today by a 47-53 vote, the Senate - including 13 Democrats - voted against a motion to end a filibuster against S. 1776, the Physician Payment Fairness Act of 2009, even though the bill had the support of the White House, Senator Finance Committee Chair Max Baucus (D-MT), and Senator Chris Dodd (D-CT), acting chair of the Senate HELP committee during the (late) Senator Ted Kennedy's illness. S. 1776 would have repealed the SGR and eliminated all of the accumulated cuts caused by the formula.

S. 1776 failed despite a huge grass roots push by the ACP, American Medical Association, and other physician organizations, and despite the fact that AARP, the voice of America's seniors, supported the bill.

The bill was victim to the dysfunctional political environment today that makes consensus so difficult. Many Republicans viewed the bill largely as a Democratic effort to "buy" physicians support for health care reform (a cynical and unsupported allegation - more on this later) and they wanted to deny the Democrats a victory on anything having to do with health care reform. They also wanted the cost of the SGR repeal to be counted against the cost of the health reform bill, so that the bill would be seen as blowing a hole in the deficit. (Never mind that the SGR, which has led to all of the accumulated cuts and costs we are now facing today, was created by the Congress in 1997, when the GOP was in control, and that past Congresses, Republican and Democratic alike, have failed to take the steps needed to fix it. The SGR problem and its cost would be with us today, even if there was no health reform bill.)

It also seems many Democrats have had the equivalent of a death-bed conversion to fiscal responsibility, or at least a make-believe version of fiscal responsibility that says that pretending to save taxpayer's money is the same as saving them money. The Senators know that the $245 billion price tag for SGR repeal is itself a budget fiction, because it requires that we suspend disbelief and assume that Congress will actually allow double-digit cuts in physician payments to go into effect. They won't and they know it. Medicare will end up spending the $245 billion anyway, but that doesn't matter, as long as the Senators can tell voters that they didn't vote for a bill that would add to the deficit.

ACP has released a statement that is harshly critical of the Senate vote and vowing to continue to push for SGR repeal. The statement takes on the charge that S. 1776 was offered in exchange for physician support of health reform:

"The American College of Physicians rejects the cynical charge made by some that physicians' support for health care reform is conditioned on repeal of the SGR. Instead, ACP supports health care reform because we believe that all Americans should have access to affordable care. Our positions on the pending health reform proposals will continue to be based on how they align with ACP's long-standing policies on ensuring coverage, reversing a catastrophic shortage of primary care physicians, and testing and implementing new models of payment and delivery to align positive incentives with the value of care provided. At the same time, we believe that repeal of the SGR is necessary to provide the stability needed to achieve real and lasting physician payment reform, to implement payment reforms to support the value of care provided by primary care physicians, and to assure seniors' access to care."

Where does this leave us on the SGR? Right where we were in . . . 2008, 2007, 2006, 2005, 2004, 2003, 2002, and 2001 . . . with Congress saying that they know the SGR has to go, that they won't allow the cuts to go into effect, that they know that have to find a permanent solution, but not now, some other time. Like the Chicago Cubs and a World Series appearance, it seems it is always "wait til next year" when it comes to repeal of the SGR.

Today's question: What is your opinion on the Senate's rejection of SGR repeal?

posted by BDoherty at 4:51 PM   9 Comments

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