SDCMS Special Update on Healthcare Reform (2010.03.23)

SDCMS Special Update on Healthcare Reform
— March 23, 2010

Executive Director Comment: “Healthcare in 20 Seconds”

• The Senate bill has now been signed into law.
• The next major event for the legislative branch is the Senate taking up the House bill — the so-called reconciliation — that must be passed by the Senate for all the details below to be implemented.
• The next major step for the judicial branch is to deal with the expected constitutional challenges that will focus on the legality of the individual mandate.
• The next major step for the executive branch is to focus on implementing a 2,000-plus-page bill — and the devil is in the details.

CONTENTS

• Short Lists of What Healthcare Reform Does for Physicians and Their Patients:
  • With Respect to Healthcare Coverage
  • With Respect to Medicare
  • With Respect to Stopping Insurance Industry Abuses
  • With Respect to Other Issues
• Unfinished Business
• What Did CMA’s Lobbying Prevent?
• What Did CMA’s Lobbying Produce?
• Healthcare Reform Timeline: Provisions Kick in Over 10 Years
• “Don’t Shortchange Seniors” Op-ed by Jim Hay, MD, in Sunday, March 21, 2010, Union-Tribune
• Brief and Detailed Legislative Summaries of HR 3590 and HR 4278
• Results of SDCMS’ March 19, 2010, "News You Can Use" Healthcare Reform Survey
• Quotes on Reform

Short Lists of What Healthcare Reform Does for Physicians and Their Patients

With Respect to Healthcare Coverage:

• All existing health plans are grandfathered in. You can keep your current insurance.
• Over 5 million uninsured Californians will have healthcare coverage (2/3 of the uninsured will be covered through private insurance).
• 1.7 million uninsured will be enrolled in Medi-Cal Physicians will receive payment for treating the uninsured.
• State-based Health Insurance Exchange providing a broad choice of physicians and health plans.
• Catastrophic-only coverage option for those under 30 years old. Takes effect immediately.
• Option to extend parent’s coverage to children under age 26. Takes effect immediately.
• Immediate temporary high-risk pool with subsidized premiums for low-income uninsured with pre-existing conditions who have been denied healthcare coverage. In existence until the rest of the bill takes effect.
• 50% Medi-Cal rate increase for primary care physicians (internists, family practice and pediatricians) to Medicare levels for E&M services and immunizations.
• Medicaid expansion is 90-100% federally financed. Rate increases are 100% federally financed.

With Respect to Medicare:

• 50% bonus for Medicare primary care physicians 2011–2015 (10%/year). It is NOT financed with a cut to other physicians.
• 50% bonus for Medicare general surgeons in rural areas 2011–2015 (10%/year).
• Medicare additional 5% bonus payment for physicians practicing in shortage areas.
• Medicare Physician Quality Reporting (PQRI) program bonuses.
• Bonus payments for physician medical homes and physicians who coordinate care through new Accountable Care Organizations.
• New investments in physician training programs and workforce support.

With Respect to Stopping Insurance Industry Abuses:

• Requires health plans to dedicate 85% of revenues to direct patient care rather than overhead and profit.
• Health Plans must have adequate provider networks.
• No insurance denials for pre-existing conditions.
• Prohibits insurance companies from rescinding coverage when a patient gets sick.
• No life-time or annual limits on benefits.
• Requires administrative simplification by all payers to reduce physician billing hassles.

With Respect to Other Issues:

• Continues to allow patients to privately contract with the physician of their choice.
• Investments in prevention, wellness and public health.
• Comparative effectiveness research to provide clinical tools to help physicians understand which treatments have the best outcomes. Includes strong prohibitions against using the research findings for coverage and payment decisions.

Unfinished Business:

• We need to repeal the Medicare SGR.
• We need to eliminate the Independent Medicare Advisory Board. [The Senate bill would establish an Independent Medicare Advisory Board, which would be required to recommend changes to the Medicare program to limit its spending growth. Its recommendations would go into effect automatically unless Congress votes to block them. Such changes would be required if the Medicare trustees projected that the program’s spending per beneficiary would grow more rapidly than the medical inflation rate or the growth in per capita medical spending. The board couldn't change eligibility or benefits, so its recommendations would likely focus on Medicare Advantage plans and on payments to medical providers. — msnbc.msn.com]
• We need to update the California Geographic Payment Localities (GPCI).
• We need to increase Medi-Cal rates for all physician specialties.
• We need to improve the quality reporting programs.

Executive Director Comment: If you think this bill could have been much more physician-unfriendly, you're right! Your CMA lobbying team did incredible work to mitigate a number of very bad ideas, listed directly below.

What Did CMA’s Lobbying Prevent?

• CMA amendment prohibited insurance companies from rescinding insurance when a patient becomes ill.
• CMA amendment removed ban on balance billing and out-of-network care.
• CMA successfully fought efforts by the Midwest rural states to reduce payments to California physicians by up to 15%. The Midwest states claim they are more efficient and California spends too much money providing care to Medicare patients. CMA amendments were accepted in the House and Senate bills and ensure that any Medicare geographic adjustments in payment must account for California’s higher practice costs (rent and wages) and socioeconomic factors (race/ethnicity, income, health status, rate of uninsured) that drive up practice costs. We also required a study before any new payment policy be implemented. AMA represents physicians in all states, so CMA had to fight this battle.
• CMA successfully fought amendments by rural states to reduce Medicare payments in California for geographic practice costs by up to 8%. CMA amendments were accepted in the Senate and require California doctors be held harmless from cuts until a study of geographic practice costs can be performed. AMA represents physicians in all states, so CMA had to fight this battle.
• CMA opposed the provision to allow nurse practitioners (NPs) to lead medical homes but could only get an amendment to leave it to state scope of practice laws. California law prohibits NPs from running medical homes.
• CMA amendment ensured that physicians forming Accountable Care Organizations do not need to include a hospital within the organization. CMA advocacy also promoted that physicians keep 80% of any savings.
• CMA worked with AMA to eliminate the Senate’s 5% Medicare penalty on physician utilization outliers.
• CMA worked with AMA to eliminate the $350 Medicare participation fee for doctors.
• CMA worked with AMA to push back the penalties on the Medicare Physician Quality Reporting Initiative (PQRI) until 2014.
• CMA and AMA opposed the cosmetic surgery tax and it was eliminated.

What Did CMA’s Lobbying Produce?

• CMA amendment required health plans to direct 85% of revenues to direct patient care.
• CMA amendment required health plans to have adequate provider networks.
• CMA successfully advocated for 100% federal financing for the Medicaid expansion and the Medicaid rate increase to reduce the burden on the state of California.
• CMA advocated for an E&M increase for all physicians participating in Medicaid. The House bill gave all physicians an E&M increase. The final bill increased E&M and immunization payment rates for primary care specialties up to Medicare levels.
• CMA successfully advocated for state-based health insurance exchanges rather than one national exchange of private health plan choices.
• CMA fought for an additional Medicare payment increase for primary care physicians on top of a rate increase for all physicians. Primary care received a 50% rate increase (10% per year).
• CMA successfully fought to maintain the right for patients to seek care from the physician of their choice outside of health plan networks.
• While the ban on future physician-owned hospitals will go into effect on December 21, 2010, CMA won the right for existing physician-owned hospitals to continue.
• CMA fought to require all quality reporting programs to be tested through demonstration projects before implementation. While the quality reporting programs will go forward without pilots, CMA won a series of amendments to protect and ensure the accuracy of physician information. CMA Senate amendments require the physician data be statistically valid (most individual physicians do not have enough patients to make the data statistically significant); the attribution methodology to be correct; the information risk-adjusted; that physicians have the right to review their data before it is finalized or made public; that CMS have appropriate systems to produce accurate physician information — among many other amendments. Additional clean-up legislation is promised.
• CMA amendments to protect physicians from potential additional liability exposure due to new practice guidelines or payment programs in the bill were included in the House bill but not in the final bill. Clean-up legislation is promised.
• CMA amendments to require a uniform Medicare prescription drug appeals form and process were included.
• CMA advocated for the Medicare rate increase for general surgeons in rural areas.
• CMA fought unsuccessfully to increase the total number of residency training slots. The final bill redistributes unused residency slots to primary care.

Healthcare Reform Timeline: Provisions Kick in Over 10 Years
[From HealthLeaders Media] Many of the provisions included in the healthcare reform legislation approved Sunday — and the bill that adds fixes to that measure that was sent to the Senate — would take place not immediately, but along a 10-year timeline through 2020. Click here for a glimpse of how that timeline rolls out.

“Don’t Shortchange Seniors” Op-ed by Jim Hay, MD, in Sunday, March 21, 2010, Union-Tribune
Dr. Hay, former SDCMS president and current CMA speaker of the House of Delegates, publishes op-ed in the Sunday, March 21, 2010, edition of The San Diego Union-Tribune: Less is more. Welcome to healthcare reform in America. And for senior citizens who have spent their lives working, raising families and contributing to society, it hardly seems fair. That’s the reality of the Senate-passed healthcare bill that is the baseline for the healthcare legislation likely to be voted on today in Washington, DC. If major changes in the bill are not made, senior citizens covered by Medicare will face increasing difficulty finding doctors to treat them and getting the care they need. Click here to read the rest of Dr. Hay’s op-ed. Note Correction: The figure of 5% for the difference between Orange and San Diego counties under GPCI is actually now 11.8%.

For Brief and Detailed Legislative Summaries of HR 3590 and HR 4278, Click Here

Results of SDCMS’ March 19, 2010, "News You Can Use" Healthcare Reform Survey
Question: Do you support the healthcare reform bills as written [HR3590 (Senate bill) and HR 4278 (budget reconciliation bill)]. Results:

• Yes, I Support It: 35
• No, I Do Not Support It: 47
• I Take a Neutral Position: 1
• I Don’t Have Enough Information: 0

Quotes on Reform

• "Cautious, careful people, always casting about to preserve their reputation and social standing, never can bring about a reform. Those who are really in earnest must be willing to be anything or nothing in the world's estimation." — Susan B. Anthony
• "My desolation does begin to make a better life." — William Shakespeare
• "Every reform, however necessary, will by weak minds be carried to an excess which will itself need reforming." — Samuel Taylor Coleridge, English Poet (1772–1834)
• "A conservative is someone who believes in reform. But not now." — Mort Sahl, Canadian-American Comedian
• "One of the greatest delusions in the world is the hope that the evils in this world are to be cured by legislation." — Thomas Brackett Reed, U.S. House Representative (1839–1902)
• "At twenty a man is full of fight and hope. He wants to reform the world. When he is seventy he still wants to reform the world, but he knows he can't." — Clarence Darrow
• "Every abuse ought to be reformed, unless the reform is more dangerous than the abuse itself." — Voltaire
• "Reform must come from within, not from without. You cannot legislate for virtue." — James Gibbons, American Cardinal of the Roman Catholic Church (1834–1921)
• "The hole and the patch should be commensurate." — Thomas Jefferson
• "Nothing so needs reforming as other people's habits." — Mark Twain
• "A reformer is a man who rides through a sewer in a glass-bottomed boat." — James J. Walker, New York City Mayor (1881–1946)
• "To reform a man, you must begin with his grandmother." — Victor Hugo
• "What is a man born for but to be a reformer, a remaker of what has been made, a denouncer of lies, a restorer of truth and good?" — Ralph Waldo Emerson