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May 2002
Volume 66 |
Number 5
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| Medicare and the
Anesthesia Shortage, Part 2: You Are Doing More Than Your
Fair Share |
Ross J. Musumeci, M.D.
Dr. Musumeci's first article on Medicare and the anesthesia
shortage appeared in the March 2002 issue.
The recently announced decline in Medicare rates has once again
focused the attention of the anesthesiology community on the sad
state of government reimbursement. While there is little debate
about the fact that Medicare rates are ridiculously low, there
does appear to be some debate centered about what can or should
be done to correct the situation. A closer examination of the
legal and financial considerations surrounding Medicare makes
a very compelling case for a more aggressive stance.
As anesthesiologists, we are morally, ethically and, in many
cases, contractually obligated to care for the elderly. We are
obligated to do so at a rate that is set by the federal government
and is 60 percent below what most would consider market rates.
This situation is clearly detrimental to anesthesiologists and
is perceived by many as exploitation of our commitment to patient
care by federal legislators. The care that we provide at fire-sale
rates is nothing less than a subsidy that we are forced to pay
to support care for the elderly.
This line of reasoning prompted a court case that was originally
brought in 1993 on behalf of a group of hospital-based physicians.
In Garelick v. Sullivan, 987 F. 2d 913 (2nd Cir. 1993),
the anesthesiologists asserted that the government-imposed cap
on fees that may be charged to patients covered by Medicare constituted
a "taking," or an unlawful seizure of assets, prohibited
by the Fifth Amendment of the Constitution. Unfortunately, the
U.S. Court of Appeals for the Second Circuit found against the
anesthesiologists. The court held that anesthesiologists were
under no legal duty to provide services to the public despite
the existence of the Emergency Medical Treatment and Active Labor
Act, which requires anesthesiologists to provide services in the
hospital setting. The court found that since anesthesiologists
are not required by law to practice in a hospital environment
and are not legally compelled to submit to price regulation, there
was no legal remedy for the situation. For many of us, the thought
of refusing to care for Medicare patients is not only morally
and ethically objectionable, it also would constitute professional
suicide since such a large portion of our business involves Medicare
recipients. Most in our profession also would agree that no more
than a fraction of our country's anesthesiologists could realistically
practice outside of the hospital setting at the present time.
Despite the inanity of the courts' ruling, other statements made
in the opinion were particularly interesting. The court expressed
sympathy with the argument that the anesthesiologists were bearing
the brunt of a government policy addressing a "social ill"
for which they were not responsible by shifting the cost of assuring
access to medical care to physicians. In essence, the opinion
acknowledged that the government is currently taking financial
advantage of our commitment to care for our patients but declined
to intervene because there was no legal compulsion for us to accept
Medicare patients, only a moral, ethical and professional one.
The Second Circuit Court of Appeals agreement further strengthens
the contention that providing anesthesia services at today's Medicare
rates represents a substantial subsidy, or hidden tax, that anesthesiologists
pay to the federal government. One might even take this a step
further and say that the subsidy is not assuring access to care
for seniors but is in fact only being paid to relieve our elected
officials from the burden of having to make the difficult budgetary
decisions that would be necessary to adequately reimburse us for
the care we provide.
The cost of low Medicare rates is difficult for most of us to
quantify because the loss occurs slowly over a number of anesthetics
and a number of years while most of us are busy trying to take
care of our patients. However, a rough "back of the envelope"
calculation is revealing. Using 1999 as an example, total Medicare
charges for anesthesia services other than pain management that
year totaled $1.39 billion. The national average Medicare conversion
factor that year was $17.24, which means that approximately 81
million units were billed.1 That same year, the average national
commercial unit rate was $43.49 according to data published by
ASA.2 If those 81 million Medicare units had been billed at the
average commercial rate, total Medicare charges would have been
$2.1 billion higher, making this the amount of our subsidy. If
we assume that membership in ASA represents 90 percent of total
practicing anesthesiologists, the number of practicing anesthesiologists
in the United States that year is estimated to be just over 26,000.3
This means that the subsidy per anesthesiologist was $81,000.
Yes, that is right. On average, each of us may have been able
to collect $81,000 more in 1999 if Medicare had been paying the
average commercial rate. Calculations for 1998 result in very
similar numbers.
How much of our time and/or money should we be willing to invest
to change this situation? If you believe the assumptions behind
this analysis, then your answer is probably "a lot."
If you were to collect that $81,000 per year over a 30-year career,
pay 40 percent tax on it and then invest the remainder in a well-balanced
portfolio earning 8 percent per year, it would be worth $5.5 million
at retirement. In order to have $5.5 million 30 years from now,
one would have to invest $547,128 as a lump sum today at 8 percent.
Maybe there are some of us who can afford to walk away from that
sum of money without trying to recover it, but it seems fair to
say that most of us cannot. Hopefully, a better understanding
of exactly how much Medicare is costing all of us will continue
to motivate our individual members and our state and national
societies to become more active and aggressive in opposing what
amounts to a seizure of assets. If nothing else, please consider
the information contained in this article the next time you debate
whether it is worthwhile to attend a political fundraiser, support
the ASA Political Action Committee, pay your ASA dues or spend
your time or money on any other activity that might help to end
low Medicare reimbursement. Each of us could generate a lot of
opposition to Medicare before exhausting the $547,128 that we
are currently leaving on the table for the government to collect.
References:
1. Personal communications with Karin Bierstein, ASA Assistant
Director of Governmental Affairs (Regulatory).
2. Bierstein K. Fees paid for anesthesia services: 1999 survey
results. ASA Newsl. 1999; 63(8):23-25.
3. Personal communication with Carol N. Krause, ASA Database
Manager.
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Ross
J. Musumeci, M.D., is Vice-President, Anesthesia Associates
of Massachusetts, P.C., Westwood, Massachusetts. |
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