Payment Cuts Research Articles

Are Payment Cuts Driving Physicians From Medicare?

Are Payment Cuts Driving Physicians From Medicare?

MedPAC Advises Against Expected Payment Cuts

MedPAC Advises Against Expected Payment Cuts

President Bush Signs Bill to Halt Medicare Physician Pay Cuts

President Bush Signs Bill to Halt Medicare Physician Pay Cuts

Medicare Prospective Payment and Quality of Care for Long-Stay Nursing Facility Residents

The Balanced Budget Act of 1997 dramatically changed the way that Medicare pays skilled nursing facilities and also cut per-diem rates. Previous studies have found effects on facility-wide staffing but not on quality for short-stay residents. Because facilities may combine revenue streams to be used where needed, spillover effects on quality of care for long-stay residents are possible. We sought to investigate effects of financial pressures from Medicare payment changes on quality of care for long-stay residents. We investigated the effect of Medicare's Prospective Payment System for skilled nursing facilities on incidence of urinary tract infections and pressure sores among long-stay residents while controlling for resident severity. We conducted panel data analysis of nursing home residents in Ohio, Kansas, Maine, Mississippi, and South Dakota using Minimum Data Set data from 1995 to 2000. Each facility's Medicare dependence was used to separate effects of the policy from underlying industry trends. The probability of developing a urinary tract infection or pressure sore increased significantly among long-stay residents after Medicare's prospective payment system was implemented. Effects were roughly proportional to the percent of residents in a facility covered by Medicare. Although Medicare prospective payment and rate cuts were directly applicable only to Medicare (largely short-stay) residents in skilled nursing facilities, the resulting financial pressures lowered the quality of care experienced by long-stay residents, as measured by the likelihood of adverse outcomes. The observed quality decreases were likely due to decreases in nurse staffing prompted by the payment reductions.

ACS Bombards Congress with Pleas to Avoid Physician Payment Cuts

ACS Bombards Congress with Pleas to Avoid Physician Payment Cuts

Fee Schedule Would Cut Audiology Rates: ASHA Leads Fight Against Proposed Reductions and Return of Medicare Caps

You have accessThe ASHA LeaderBottom Line1 Sep 2005Fee Schedule Would Cut Audiology Rates: ASHA Leads Fight Against Proposed Reductions and Return of Medicare Caps Steven White, and Marat Moore Steven White Google Scholar More articles by this author and Marat Moore Google Scholar More articles by this author https://doi.org/10.1044/leader.BML2.10122005.1 SectionsAbout ToolsAdd to favorites ShareFacebookTwitterLinked In Audiology reimbursement could be cut by as much as 21% for certain procedures by 2009 if proposed changes in the 2006 Medicare Fee Schedule are approved. The Centers for Medicare and Medicaid Services (CMS) published the 2006 proposed rates in the Federal Register on Aug. 8, with an overall cut in 2006 payments of 4.3%. ASHA has intensified its efforts to come to agreement with CMS on a new reimbursement methodology that fairly values the professional expertise and judgment of audiologists and speech-language pathologists in its determination of levels of relative value payments. Public comments are due by Sept. 30, and ASHA will submit its objections in detailed comments. Opposition is also building in Congress, where several bills supported by ASHA already have been introduced to repeal the statutory formula used to determine the payment cut. It came as no surprise that CMS proposed ending the “non-physician work pool” (NPWP) in the reimbursement formula. CMS created the NPWP to protect the technical component services (including audiology and speech-language pathology) from “substantial decreases” until “further refinement” could take place. Without the NPWP, most audiology and speech-language pathology services would be relegated to the practice expense methodology used for all other procedures and would be vulnerable to payment cuts. Anticipating this change, three years ago ASHA’s Health Care Economics Committee began to research and present alternatives to CMS-focused on relocating the practice expense labor to the professional component (i.e., “physician work”) that would recognize the professional expertise and judgment of audiologists and SLPs. ASHA has proposed using survey data that ASHA can present to the American Medical Association’s Health Care Professional Advisory Committee (AMA HCPAC) to strengthen the case for the move to the “physician work” category. Under the current CMS proposal, however, the NPWP will be phased out over the next four years without a new reimbursement methodology to take its place-which means rates will not be protected against decreases that could hurt audiology in particular. According to Robert Fifer, an audiology member of the Health Care Economics Committee (HCEC), CMS has responded positively to ASHA’s request to work together to ensure that audiology and speech-language pathology as professional disciplines are not devastated by elimination of the NPWP. Fifer serves as ASHA’s advisor to the AMA HCPAC. Last December, Fifer and other committee members and ASHA staff met with CMS representatives to discuss what could happen if the NPWP were abolished without a reasonable reimbursement formula to take its place. CMS informed ASHA that rates would be negatively affected, “but would not tell us the extent of the payment cuts,” said Fifer, adding, “Now we know how serious the impact may be-a potential 21% cut by 2009 for audiology rates.” “Knowing the timetable and magnitude of the reimbursement impact, the HCEC will work very closely with both CMS and the AMA to find a reimbursement methodology that will alleviate, as much as possible, any long term negative effects of NPWP elimination,” he said. Proposed Rates CMS provided proposed relative value units for all procedures. The following are speech-language pathology and audiology procedures that have the most notable changes for 2006: Speech-language pathology: speech-language evaluation (+2 1/2%) swallowing treatment (+5%) clinical swallowing evaluation (-13%) motion fluoroscopic swallowing evaluation (-10%) Audiology: comprehensive audiometry (-5%) evoked otoacoustic emissions- limited (-13%) evoked otoacoustic emission-comprehensive (-9%). Medicare Caps The proposed rule also makes clear that without congressional intervention, the annual (per beneficiary) combined therapy cap for physical therapy and speech-language pathology services, and a separate occupational therapy cap will again be in effect at the beginning of 2006. CMS estimates that the value of the caps for 2006 will be $1,750. ASHA is actively working with Congress and other rehabilitation groups to repeal or modify the reintroduction of the caps. To access proposed rates, see the August 8, 2005 Federal Register. Author Notes Steven White, director of health care economics and advocacy, can be reached at [email protected]. Marat Moore, managing editor of The ASHA Leader, can be reached at [email protected]. Advertising Disclaimer | Advertise With Us Advertising Disclaimer | Advertise With Us Additional Resources FiguresSourcesRelatedDetails Volume 10Issue 12September 2005 Get Permissions Add to your Mendeley library History Published in print: Sep 1, 2005 Metrics Current downloads: 52 Topicsasha-topicsleader_do_tagasha-article-typesleader-topicsCopyright & Permissions© 2005 American Speech-Language-Hearing AssociationLoading ...

AMA President Blames Legal System For Malpractice Insurance Crisis

Back to table of contents Previous article Next article Professional NewsFull AccessAMA President Blames Legal System For Malpractice Insurance CrisisMark MoranMark MoranSearch for more papers by this authorPublished Online:16 Jul 2004https://doi.org/10.1176/pn.39.14.0390020Liability reform remains the number-one legislative priority of the American Medical Association. And reformulating the way physicians are paid under the Medicare program is running just behind.In his opening address at the 2004 annual meeting of the AMA House of Delegates last month in Chicago, AMA President Donald Palmisano, M.D., reiterated the organization's central message on liability reform: rising malpractice premiums threaten access to care by driving physicians from medical practice.He took aim again at the trial lawyers association and at apologists for the insurance industry who claim that stock-market losses in the 1990s are behind the rapid increase in premiums today.“We have debunked the myth that insurance companies' stock-market losses are fueling skyrocketing medical liability premiums,” he said.“ No, what is driving this crisis are the out-of-sight awards some runaway juries are handing out in certain liability cases. Today the average jury award nationwide is $6.2 million, up from $3.9 million in 2001.”Palmisano said that in Mississippi, more than $33 million was awarded in just four medical liability verdicts. And in Pennsylvania, juries returned $15 million and $20 million verdicts on the same day, he said.“Any wonder that our AMA master file from 1997 to 2002 confirms that more than 400 Pennsylvania physicians in just four specialties are no longer practicing medicine in the state?” he asked. “Those doctors are neurosurgeons, orthopedists, obstetricians, and general surgeons. You can't replace those talented individuals from a shelf at the supermarket.”Palmisano called for a sea change in the way medical errors are detected and fixed, replacing a punitive approach that focuses on individual mistakes with a “system quality control” approach that views errors as the result of remediable flaws within an organized system.As a model, he cited the aviation industry, which uses just such an approach in the prevention of airline crashes.“To stop errors, we need to prevent them through improved systems of safety,” Palmisano said. “We need to know how errors occur within a given system and find solutions based on the evidence. Now the fear of lawsuits deters health care professionals from reporting problems and hinders the efforts to determine how to keep them from happening again.“We need to put a reporting system in place where physicians and other health professionals can report errors without fear of litigation.”Palmisano also cited the AMA's proposal for health care reform (see Original article: page 18), which appears as a special communication in the May Journal of the American Medical Association.Running somewhere behind liability reform on the AMA's legislative radar screen is reformulation of Medicare's physician payment formula. Palmisano hailed the passage late last year of the Medicare Modernization Act, which the AMA had backed, but he called again for junking the current physician reimbursement formula.Despite the 1.5 percent across-the-board increase in physician payments for 2004 and 2005 contained in the Medicare reform bill, Palmisano said payment cuts were likely again in the future.“As long as we labor under a flawed Medicare formula that sends us lurching from one payment crisis to the next, we will not rest,” he said. “We face new cuts totaling 35 to 40 percent from 2006 to 2013. Temporary fixes aren't good enough. We need a permanent solution as soon as possible.” ▪ ISSUES NewArchived

Low-Income Patients Benefit Most From Medicare Prescription Law

Low-Income Patients Benefit Most From Medicare Prescription Law

Medicare Payment Cuts May Threaten Psychiatric Care

Medicare Payment Cuts May Threaten Psychiatric Care

Will Patient Care Be Capped in 2003?

Will Patient Care Be Capped in 2003?

Congress Shifting Position on Medicare Payment Increases

Back to table of contents Previous article Next article Government NewsFull AccessCongress Shifting Position on Medicare Payment IncreasesKate MulliganKate MulliganSearch for more papers by this authorPublished Online:5 Jul 2002https://doi.org/10.1176/pn.37.13.0002Congress is moving toward an increase in Medicare payments for doctors, hospitals, and health maintenance organizations.The Bush administration’s insistence that any increase in Medicare reimbursement rates for physicians must result in corresponding decreases in other Medicare provider spending had the potential for pitting various segments of the health care system against each other (Psychiatric News, March 1, April 5, May 3).Health care professionals, however, worked together to pressure Republicans to renounce the Bush administration’s insistence on budget neutrality.Sam Goldreich of CQ Daily Monitor told www.kaisernetwork.org that the reversal came about because “House Ways and Means Chair Bill Thomas [R-Calif.] and House Energy and Commerce Chair Billy Tauzin [R-La.] decided not to play Bush’s zero-sum game for Medicare providers.“Instead, they promised rank-and-file Republicans that not only would hospitals get increases, but they would change current law that would have cut [payments to] doctors, nursing homes, and home health operators.”Hospitals Fight BackLast March Tommy Thompson, secretary of the Department of Health and Human Services, and Mitchell Daniels Jr., director of the Office of Management and Budget, proposed that increases to physicians be offset by “savings from. . .measured changes in hospital payment updates” (Psychiatric News, May 3).In a response dated March 26 to the administration’s proposal, a coalition of eight organizations representing hospitals wrote, “More than half [the hospitals] lose money treating Medicare patients. Fully one-third are losing money overall. And, without corrective action, $21 billion in additional reductions will be implemented by October 1, 2002.”The June 5 New York Times reported that a “quiet rebellion by rank-and-file House members, including many from New York, forced House Republican leaders to reverse themselves [about the proposed cut].”The Times reported that Republican leaders had reached an agreement to increase Medicare payments to hospitals by $9 billion over the next 10 years instead of cutting payments by $17 billion.On June 5 www.kaisernetwork.org reported that hospital groups had written letters in praise of the agreement.An analysis by the AMA, however, points out that the Thomas-Tauzin proposal would only slow currently scheduled reductions in payments for graduate medical education.More Money for DoctorsThomas and Tauzin have also proposed increasing Medicare payments to doctors by $20 billion over five years.According to an analysis of the proposal by the AMA, beginning in 2003 and extending through 2005 physicians would receive annual payment increases of approximately 2 percent, as compared with the current projected cuts of 5.7 percent in 2003, 5.7 percent in 2004, and 2.8 percent in 2005.The 2002 payment cut of 5.4 percent would remain unchanged.In 2006 physician payments would again be cut, as the proposal is now constituted. According to the AMA, Thomas and Tauzin have agreed to work toward a more permanent solution that would avoid those cuts.The AMA is continuing to urge the Centers for Medicare and Medicaid Services to make administrative changes that would eliminate or soften cuts under the current formula. For example, in 1998 and 1999 Medicare officials set spending targets too low and left the costs of more than 1 million beneficiaries out of the system. They also erroneously include the costs of physician-administered drugs when calculating costs of services (Psychiatric News, June 7).Fixing those errors could restore $62 billion over 10 years to the pool available to make payments to physicians, according to the AMA analysis.Jay Cutler, J.D., director of APA’s Division of Government Relations, said, “The AMA deserves thanks and praise for helping to demonstrate what a powerful force medicine can be when its practitioners present a united front. The proposal is a good step in the right direction, although it does not offer all that medicine deserves.”Other winners in the Thomas-Tauzin proposal are managed care companies. The proposal would increase payments to insurance companies that administer Medicare+Choice, the Medicare managed care option.AARP, formerly the American Association of Retired Persons, is worried that seniors will pay the price for increases to health care providers. David Certner, director of federal affairs at AARP, said that the proposal would mean “less money for drug benefits in a pot that was already insufficient,” according to the Times.Goldreich told www.kaisernetwork.org that Thomas and Tauzin “swear it isn’t [coming from the prescription drug benefit].”The committee chairs claim that their proposal for a prescription drug benefit would produce a cut in the cost of prescription drugs for seniors of 30 percent. The savings would be the result of promoting competition among private health insurance companies that would offer policies to cover drugs only and by encouraging them to negotiate discounts with the drug companies.“Medicare Physician Payment Update Background and Talking Points” is posted on the Web at www.ama-assn.org/ama/pub/article/6930.Numerous reports on Medicare are posted at www.kaisernetwork.org/daily_reports/rep_index.cfm. ▪ ISSUES NewArchived

The Emergency Medical Treatment and Labor Act as a federal health care safety net program.

Despite the greatest economic expansion in history during the 1990s, the number of uninsured U.S. residents surpassed 44 million in 1998. Although this number declined for the first time in recent years in 1999, to 42.6 million, the current economic slow-down threatens once again to increase the ranks of the uninsured. Many uninsured patients use hospital emergency departments as a vital portal of entry into an access-impoverished health care system. In 1986, Congress mandated access to emergency care when it passed the Emergency Medical Treatment and Labor Act (EMTALA). The EMTALA statute has prevented the unethical denial of emergency care based on inability to pay; however, the financial implications of EMTALA have not yet been adequately appreciated or addressed by Congress or the American public. Cuts in payments from public and private payers, as well as increasing demands from a larger uninsured population, have placed unprecedented financial strains on safety net providers. This paper reviews the financial implications of EMTALA, illustrating how the statute has evolved into a federal health care safety net program. Future actions are proposed, including the pressing need for greater public safety net funding and additional actions to preserve health care access for vulnerable populations.

HEALTH INSURANCE AND HEALTH ACCESS: REENGINEERING LOCAL SAFETY NETS

National policy makers focus on insurance coverage from a national perspective?expanding it (or not) or re-engineering it (or not), noted this article on gaps in insurance and emerging options in safety-net systems. Interest in promoting insurance for all has for the moment waned, though the number of uninsured Americans has generally increased for over a decade. The ultimate backstop for uninsured access is the local safety net, dominated by hospitals and clinics with a mission to serve the underserved. Federal policy mandates limited hospital access to emergency hospital care, but only indirectly influences general provision of care. General safety net access is left for local provision of care and, usually, local funding. Insurance policy, public and private, is pressuring the hospital-based safety net through payment cuts and managed care shifts in patterns of delivery. Some localities are experimenting with new organizational arrangements. Their experience suggests some policy options for the twenty-first century. The safety net ought to get more policy attention at higher levels of government. (Journal of Legal Medicine 2001 April; 22(2): 247-262).

Factors that enhance continued trauma center participation in trauma systems.

To examine hospital, trauma system, and reimbursement factors that offset the financial burdens of trauma care delivery and to assess how proposed Medicaid and Medicare budget cuts may affect the ability of hospitals to alleviate financial pressures related to trauma care delivery. In-depth interviews and data collection for trauma centers in 12 metropolitan areas with populations of 1 million or more. Seventy trauma centers in these large urban communities that indicated a continuing commitment to providing trauma services for the foreseeable future. Hospital, trauma system, and reimbursement characteristics that distinguish hospitals that are better able to alleviate the financial burdens of indigent trauma care and a financial analysis that assesses payment adequacy for different payers and overall financial outcomes. Data from a variety of sources were obtained to measure the factors that affect the operation and financing of trauma centers: published and unpublished hospital data from the American Hospital Association; trauma center level, length of operation, and the availability of alternative centers from a recently published study; Health Care Financing Administration data on Medicare and Medicaid program characteristics; automobile insurance requirements; and patient discharge data. Most data are reflective of 1992. Public hospitals, teaching hospitals, and institutions receiving supplemental indigent care payments appear to be best able to mitigate the financial burdens of uncompensated trauma care, especially those with moderate indigent care loads. A detailed financial analysis found that private hospitals with trauma centers were near break-even in 1992 for trauma care delivery and public hospitals experienced financial losses. Proposals to reduce Medicaid and Medicare would create substantial reductions in hospital payments for hospital-wide patient care and trauma patients specifically. Proposed Medicaid and Medicare payment cuts are likely to eliminate the delicate financial balance that many urban hospitals have achieved in providing trauma care. The erosion in funding from public programs may portend a new wave of trauma center closures as hospitals seek to deal with reduced reimbursement by eliminating unprofitable services.

The radiology relative value scale: its development and implications.

In a proactive response to federal government cost-containment pressures, the radiology profession, under the leadership of the American College of Radiology (ACR), in 1988 developed a relative value scale (RVS) for radiologic procedures. Like earlier radiology RVSs, its relative values reflected the physician work and practice costs involved in each procedure. The RVS was constructed by using (a) three types of data (magnitude estimation, charges, and practice costs) obtained by means of surveys and (b) expert consensus panels involving participants from all fields and many organizations in radiology. The RVS was accepted, essentially in toto, by Medicare. Subsequently, the RVS has required much work to correct errors by Medicare and the insurers that administer it, to improve procedure codes, and to develop codes and relative values for new procedures. By moving proactively, radiology preserved fee-for-service against a major threat, reduced payment cuts from those that seemed to be impending, and gained a unique degree of control over its payments. However, the new payment system is complex and does not reward efficacy, cost-effectiveness, or quality.

Speaking out.

I am writing in response to the article in the Nursing Standard, week ending November 28, regarding the proposed cuts in nurses' extra duty payments.

Les comptes de la protection sociale : historique et perspectives

The French Social Security : History and Forecasts A. Fonteneau, A. Gubian, H. Sterdyniak, C. Verpeaux The ratio of social security payments to GDP has expanded from 17 to 27 percent over the last twenty years. Three sub-periods can be distinguished. From 1968 to 1973, there was a rapid increase in social security benefits (6.7 % p. a.) and a similar increase in GDP. From 1973 to 1982 benefits kept on rising sharply (+ 6.4 % p. a.), but the growth of real GDP was much slower. Since 1982 the annual increase in benefits has decelerated (2.6 %). It has however remained higher than the growth of GDP. The waning of welfare policy began in 1983. The ratio of social security payments to GDP rose from 17.7 percent in 1968 to 18.3 in 1973, to 26.3 in 1982 and to 27.1 in 1986. The counterpart was a similar increase in social security contributions. From 1973 to 1982 employers' contributions rose as much as those of employees. From 1982, the rise in employers' payments has been lower than that of employees. Such a policy accounts for the high increase in the share of net wages in gross wage costs (40 % in 1986). Three medium-term projections of the Social Security were analysed. In the first scenario, there are neither new fiscal measures nor new cuts in social payments. From 1987 to 1992 the average annual growth of social security benefits would be lower than that recorded between 1981 and 1986. (2.7 % against 3.4 %). Because of the weak growth of GDP, the ratio of benefits to GDP would be 1.6 percentage points higher, and social contributions would rise slowly (0.8 % p. a.). The deficit would reach FF. 136 billion (i.e. 2.7 % of GDP). It would be about FF. 120 billion with an increase in wages of 2 percent per annum from 1989 to 1992 (second scenario). In order to eliminate such an automatic deficit, new measures are taken into account in the last projection. No particularly painful reform of the social security system is assumed, and the employers' contributions remain stable. Social benefits would then rise by 2.3 % p. a. The contributions on the retired, on the unemployed and on employees would be substantially raised. Further, the rate of contributions based on total income would reach 0.8 % in 1992. Postponing the retirement age is not desirable when unemployment is high. Indexing pensions to net wages would be fairer than making the retired bear the cost of the necessary adjustments. The development of pensions by capitalization seems difficult and liable to make the matter worse. Under present legislative provisions, the levy on the active population would increase dramatically (44 % from now on to 2020), although this would not necessarily prevent a rise in the purchasing power of the wage earners. The present system of family allowances looks insufficient. But it is not really unfair provided that it is supplemented by a guaranteed minimum income mechanism. As far as unemployment benefits are concerned, the Government should subsidize the creation and the maintenance of marginal jobs. The total budgetary cost would be negligible.

The Impact of Third-Party Payment Cutbacks on the Private Practice of Psychiatry: Three Surveys

Recent cutbacks in private insurance benefits and publicly funded health programs are threatening the access of Americans, particularly the poor and the disabled, to private psychiatric care. The authors present the findings of three surveys that assessed the impact of threatened or actual cuts in third-party payments on the treatment provided by private practitioners. One survey indicated that, contrary to popular opinion, more than half of the psychiatrists in Northern California see severely disturbed Medicaid patients and that they provide outpatient psychiatric services to them for less cost than would public clinics. Two surveys conducted in the Washington, D.C., area indicated that both patients and psychiatrists have suffered from insurance cutbacks, with fewer patients being able to afford intensive private treatment and psychiatrists using reduced fees and less optimal treatment modalities. The fiscal and ethical dilemma posed by the cutbacks and further research needs are also explored.