June 1997
Volume 61 |
Number 6
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WASHINGTON REPORT
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| Administration,
Congress Agree on Budget Plan; PPRC Supports ASA View on Conversion
Factor |
Michael Scott,
Director
Governmental and Legal Affairs
In early May, the Administration and Republican Congressional
leaders announced agreement on the general principles of a five-year
budget plan, leading to a balanced federal budget by the year
2002. Included in the agreement was $115 billion in Medicare savings,
the bulk of which will come from slowing the rate of growth of
payments to providers.
Details of the deal were sketchy, but it is reasonable to anticipate
that the principal impact on physician reimbursement will be the
establishment of a single Medicare conversion factor at a level
designed to generate several billion dollars in savings over the
five-year period, together with an alteration in the annual fee
schedule update formula resulting in slower reimbursement increases
than currently expected.
The congressional budget committees must now go to work developing
the nonbinding budget resolution, which, when ultimately passed
by the Senate and House, will form the framework for the development
of specific provisions by the relevant congressional committees.
This process will likely take a number of months, probably until
late summer or early fall.
For anesthesiologists, the most significant budget-related development
in early May took place, not at the White House or in Congress,
but at a meeting of the Physician Payment Review Commission (PPRC),
the highly respected, nonpartisan body appointed by Congress to
advise it on provider reimbursement matters under federal health
programs. At the urging of ASA, the PPRC voted to recommend to
Congress that, in the event of a move to a single conversion factor
under the Medicare Fee Schedule, the existing ratio (about 46
percent) be maintained between the anesthesiology conversion factor
and the conversion factor for all other physicians.
As previously reported in this column, the President's proposed
budget had called for about a 10-percent cut in the anesthesiology
conversion factor, which would have changed the conversion factor
ratio to about 41 percent. ASA has argued that such a cut, when
viewed in the context of anesthesiology's full experience under
the Medicare Fee Schedule, would unfairly penalize the specialty
solely because it had been moved by Congress into the surgical
update category two years ago. The PPRC recommendation effectively
accepts ASA's argument and, if adopted, would essentially serve
to place the specialty on a par with all others in terms of its
treatment under the single conversion factor proposal.
The PPRC recommendation provides a major boost to ASA's legislative
efforts on this front, efforts that began at the outset of the
new Congress and were intensified at the time of the ASA Legislative
Conference. Although many surprises await as the budget process
unfolds, we are now cautiously optimistic that Congress will not
adopt the President's budget proposal on the anesthesiology conversion
factor and will treat the specialty fairly as the relevant congressional
committees develop legislation relating to the single conversion
factor.
ASA Preparing Fraud and Abuse Manual, Including Model Group
Compliance Plan
Meeting at the time of the Legislative Conference in April, the
ASA Administrative Council approved the expenditure of approximately
$50,000 for the development of a monograph on federal fraud and
abuse principles applicable to the practice of anesthesiology.
The monograph also will contain specific advice for anesthesiology
groups on the development of a plan for assuring compliance with
federal law in this regard. The Society's law firm of Squire,
Sanders and Dempsey will prepare the publication.
Numerous ASA members, who are legitimately concerned about the
ongoing publicity being given to the government's antifraud efforts,
have requested the Society's leadership to provide them with assistance
to be certain that their practices are in accord with federal
requirements. It is expected that the completed monograph will
be available to the membership by mid- to late-summer. Further
information on availability will appear in this column soon.
1997 Legislative Conference Summary
Janée L. Bonner
Federal Affairs Coordinator
The annual ASA Washington Legislative Conference was held in
our nation's capital on April 13-15, 1997, with more than 360
anesthesiologists in attendance. Representatives from 47 states
and the District of Columbia attended the three-day meeting to
hear presentations from a member of the House Commerce Committee
as well as congressional staff, administration representatives
and members of the media on a variety of issues facing anesthesiologists
at the state and federal levels.
Bertram W. Coffer, M.D., Chair of the Committee on Governmental
Affairs, was joined by ASA President Phillip O. Brid-enbaugh,
M.D., in opening the conference and welcoming the attendees.
Both men stressed the importance of political involvement and
commended the attendees for taking the time to come to Washington
as the Congress is once again viewing Medicare reductions as a
way of reducing the federal deficit.
The luncheon speaker on Sunday, April 13, was Steve Roberts,
formerly a senior writer with U.S. News and World Report
and now with the New York Daily News. Mr. Roberts brought
the audience up to date on the state of political affairs in Washington,
noting repeatedly that American politics are "played between
the 40-yard lines." He explained that the United States is
not a revolutionary country, but rather one that is moderate and
cautious. Americans tend to prefer the "sensible center,"
and Mr. Roberts believes that Newt Gingrich and Bill Clinton used
each other in the 1996 elections as foils; Gingrich and the GOP
would be there to protect the nation from Bill Clinton, who would
be there to protect the country from the "radical right."
He noted that the biggest problem facing American politics today
is the continued growth of cynicism toward government among the
electorate, and he urged the audience to work against such cynicism.
Following Mr. Roberts' presentation, the attendees learned the
ins and outs of legislative advocacy and strategic planning from
Joseph C. Gagen, J.D. a consultant who specializes in working
with physician associations on legislative educational programs.
The interactive style of the presentation featured an audience
participant, Patricia J. Davidson, M.D., from Columbus,
Ohio, who role-played as a state senator.
Accreditation Issues
Representatives of three accrediting organizations, together
with an antitrust attorney, presented a panel on "The Process
and Pitfalls of Accreditation." The first panelist was Anne
M. Kaeser, M.D., M.B.A., an ASA member and an accreditation
surveyor for the Accreditation Association for Ambulatory Health
Care (AAAHC). Dr. Kaeser explained the AAAHC accreditation process
and the organizational objectives for the years immediately ahead
to improve the AAAHC's accreditation program.
Dr. Kaeser was followed by Paul M. Schyve, M.D., Senior
Vice President for the Joint Commission on Accreditation of Healthcare
Organizations. Dr. Schyve drew attention to the fact that although
the Joint Commission has traditionally been an accrediting organization
for establishing standards for hospitals and ambulatory surgical
centers, it is now beginning to move into measurement of patient
outcomes.
The third speaker was Stephen N. Lamb, Assistant Vice
President for Public Policy for the National Committee for Quality
Assurance (NCQA). Mr. Lamb noted the fact that approximately 55
percent of the health maintenance organizations (HMOs) operating
in this country have gone through the NCQA accreditation process,
with an 11-percent denial rate. Mr. Lamb also noted that in the
accreditation process, his organization is always looking for
improvement by HMOs in quality standards, utilization management,
credentialing and articulation of members' rights and responsibilities.
The final speaker on the panel was Jack Bierig, J.D.,
of the Chicago firm of Sidley and Austin. Mr. Bierig briefly reviewed
the antitrust principles applicable to the operation of residency
review committees (RRCs) and introduced participants to the currently
proposed federal legislation to provide RRCs with a measure of
protection against antitrust attack.
AMA Agenda
The closing speaker on Sunday afternoon was Daniel H. Johnson,
Jr., M.D., President of the American Medical Association.
In addition to thanking ASA's representatives to the AMA House
of Delegates for their hard work, Dr. Johnson stated the AMA's
strong belief that the Medicare program is in dire need of restructuring.
He explained that the organization has been trying to make the
necessary improvements in the program since 1986 and encouraged
ASA members to stay involved in the legislative process as this
effort gets under way.
Political Update
The first speaker on Monday morning was Robert Merry,
president and publisher of Congressional Quarterly, a Washington-based
publishing company that specializes in information on government
and politics. Mr. Merry provided the audience with an insightful
look into Washington politics, noting that the American electorate
chose a divided government in 1996 (Clinton in the White House,
GOP in Congress), but that divided government is not working.
Mr. Merry predicts this Congress will produce limited legislative
action, in which small proposals are heralded as big ideas and
the festering problems of entitlement programs such as Medicare
will continue to fester.
View From the Hill
The conference was addressed by several congressional staffers
on Monday morning, starting with Howard J. Cohen. Mr. Cohen
serves as counsel for the majority side of the House Committee
on Commerce, a position that enables him to focus on the House
GOP leadership's continued efforts to restructure the Medicare
program. He explained that the process of Medicare restructuring
is different in this Congress than it was during the last one,
as the changes in the Medicare and Medicaid programs will be set
by the committees with jurisdiction over the program (i.e., Commerce,
Ways and Means), as opposed to being determined by the House leadership.
Once again, the changes in these programs and the debate on the
issues will take place within the broader scope of the budget
reconciliation bill.
Mr. Cohen was followed by his colleagues from the other side
of the aisle, Bridgette Taylor and William K. Vaughan.
Ms. Taylor is a professional staff member for the minority on
the Commerce Committee and has an extensive background in health
legislation with specific expertise in the area of Medicare. Mr.
Vaughan is currently the professional staff member for the Democrats
on the Ways and Means health subcommittee.
Mr. Vaughan provided the audience with a copy of the latest Administration
proposal for balancing the federal budget. The Administration
has proposed $7 billion in savings from physicians under the Medicare
program, most of which would come about through the move to a
single conversion factor under the Medicare Fee Schedule. Ms.
Taylor stated that the Democrats on the House Commerce Committee
are also looking into managed care reform, noting that Congressman
John D. Dingell (D-MI) has introduced legislation to control industry
excesses and provide more patient protections.
Dissecting the CHEG Guide
The final speaker of the morning was Orin F. Guidry, M.D.,
ASA Assistant Treasurer and Chair of the ASA Task Force on Procedure-Based
Reimbursement. Dr. Guidry offered a detailed background on the
work of the task force, noting that the initial conclusion of
the group is that the ASA's Relative Value Guide is fair, simple
and a good measure of work and that it works well if the conversion
factor is adequate. There are concerns that it does not work well
outside of the operating room and that it makes it easier for
payers to single out anesthesiologists.
Soon after the first task force meeting, ASA learned that the
Cambridge Health Economics Group (CHEG) has begun marketing an
anesthesia reimbursement system based on average time, the CHEG
ARBRVS™. Commissioned by ASA, the Lewin Group has begun an
analysis of the CHEG ARBRVS, with a preliminary analysis delivered
to ASA in early April (see "Practice
Management").
Dr. Guidry noted that in general, there exist problems with a
system based on average time; for example, anesthesia codes have
a great average time variability because of the large number and
variety of surgical CPT codes in each anesthesia CPT code. It
is also difficult to get good average time data because Medicare
average anesthesia times are not reported by surgical CPT codes.
There is also concern that such a reimbursement system may further
solidify the substantial underpayment of anesthesiology relative
to other specialties under the Medicare RBRVS and may hasten the
spread of this inequity to other payers.
"Putting Patients First"
The luncheon speaker on Monday was Richard Smith, Vice
President for Public Policy for the American Association of Health
Plans, the nation's largest trade association for HMOs and network-based
health care systems. Mr. Smith presented the association's plan
for ensuring that HMO patients continue to receive top-quality
health care while costs are contained. "Putting Patients
First" is the AAHP's recently initiated public relations
program, which focuses on appropriate care, patient satisfaction,
physician choice, prevention and affordable comprehensive care.
It is the belief of AAHP that legislation to provide such protections
is not necessary, as the industry is policing itself against problems
such as the "gag clause."
GME Issues
Later in the afternoon, the conference was addressed by Mary
Beth Bresch White, Senior Legislative Analyst with the Association
of American Medical Colleges. In addition to reviewing indirect
and direct costs of medical education, Ms. Bresch White also explained
the manner in which graduate medical education (GME) has been
targeted in the federal budget discussions. Under the President's
proposal, Medicare payments with an education label and disproportionate
share hospital payments would be moved from the Medicare Hospital
Insurance Trust Fund (Part A) to the general revenues portion
of the program. This move would place the payments in the discretionary
spending category, subjecting them to the annual appropriations
process. This would mean losing the link to Medicare beneficiaries
as well as losing a stable funding source for GME and the economically
disadvantaged who need health care.
Medicare Issues
A panel featuring four experts on the Medicare Fee Schedule focused
attention of the meeting participants on current issues now facing
the Congress and the Health Care Financing Administration. The
first speaker was Bernard J. Patashnik, former Director
of the Division of Medical Services Personnel at HCFA and now
a consultant with MARC Associates. Mr. Patashnik described the
various steps by which the Medicare Fee Schedule came into being
and outlined the current components of the Schedule.
Allen Dobson, Ph.D., of the Lewin Group then followed
with a discussion of the current controversy relating to the development
of resource-based practice expenses. He noted that the HCFA raw
estimates of the results of its practice management research were
based upon partial and incomplete data.
Dr. Dobson was followed by David Colby, Ph.D., Deputy
Director of the Physician Payment Review Commission, who explained
the limitations of the current Medicare Fee Schedule update formula
and outlined the recommendations of the commission for an alternative
approach. He also noted the commission's view that resource-based
practice expenses should, contrary to current law, be phased in
over a period of time.
The final speaker was Grant Bagley, M.D., J.D., Medical
Advisor to the Bureau of Policy Development at HCFA. In reviewing
the future of fee-for-service medicine under the Medicare program,
Dr. Bagley noted that HCFA was looking for new methods of reimbursement
of physicians that combine the best of both fee-for-service and
managed care methodologies.
Congressman Sherrod Brown
On Tuesday morning, the conference was honored to hear from U.S.
Representative Sherrod Brown (D-OH), the ranking minority
member on the House Commerce Committee's Health and the Environment
Subcommittee. Congressman Brown has been a leader on issues such
as controlling the excesses of the managed care industry and has
co-authored legislation that would provide for the point-of-service
option and end the gag clauses in HMO contracts with physicians.
Congressman Brown thanked ASA for all of its help on that legislation
and also expressed support for the fair treatment of anesthesia
in the move to a single conversion factor for the Medicare Fee
Schedule.
The final speaker of the conference was Sharon McIlrath,
Assistant Director for Federal Affairs for the American Medical
Association. She expressed AMA's strong support for the fair treatment
of anesthesia under the proposed conversion factor and reviewed
other issues on the legislative agenda for the AMA.
Capitol Hill Visits
As in previous years, conference attendees made the short trip
to Capitol Hill following the conclusion of the conference. During
visits with their individual legislators, these ASA members expressed
the Society's view on various issues, most importantly the equitable
treatment of anesthesia in the move to a single conversion factor
under the Medicare Fee Schedule. They also discussed issues such
as managed care excesses, medical direction for nurse anesthetists
and fraud and abuse provisions.
Continued involvement of ASA membership is still the most effective
way of expressing the concerns of the Society to legislators,
both on the state and federal levels. It is important to let your
senators and representatives know your opinion on all issues that
affect your practice. Copies of ASA's current position statements
on a variety of legislative issues are available on the ASA Web
site or by contacting the ASA Washington Office at (202) 289-2222;
e-mail <mail@ASAwash.org>.
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