Delayed Effective Date
of CMS 2003 Rule Affords Congress a Chance to Fix
Update
Michael Scott, J.D., Director
Governmental and Legal Affairs
Senate
Acts
On January 23, the Senate passed its version
of the FY2003 omnibus appropriations bill.
The bill contains a provision rolling
back the projected March 1 cut in the
Medicare anesthesia conversion factor.
A conference with the House to develop
final legislation is expected in early
February. |
|
As discussed in the January 3
President’s
Update by James E. Cottrell, M.D., and in this
month’s “Practice Management” column
(page 28), the Centers for Medicare & Medicaid
Services (CMS) announced the terms of its 2003 Medicare
Fee Schedule rule in late December. The rule, involving
a cut in the Medicare anesthesia conversion factor
of 3.43-percent (about one percentage point less than
for other specialties), will take effect on March
1.
Publication of the rule, normally expected around
November 1, was allegedly delayed because of the need
for CMS to further study appropriate action with respect
to an increase in value of anesthesia work. Although
this claim may contain a grain of truth, the more
likely reason for the delay stemmed from CMS’
desire to give the 107th Congress in its year-end,
lame duck session an opportunity to roll back the
cuts before they could take effect. As Dr. Cottrell
has advised, the 107th Congress took no action.
Because of the March 1 effective date, however, the
new Congress, which convened January 7, also has the
opportunity to provide prospective relief. As ASA
members are aware, ASA, the American Medical Association
and all the other major national specialty organizations
attempted to exploit this opportunity with an all-out
grassroots lobbying campaign coupled with a physician
fly-in on January 8-9. By mid-January, ASA members
had sent more than 10,000 messages to their Senators
and Representatives calling for relief from reimbursement
cuts.
In this connection, physicians across the country
have been encouraged by the fact that one of their
own, Senator Bill Frist (R-TN), was elected Senate
Majority Leader by his GOP colleagues late in December.
There is no doubt that Senator Frist has been a good
friend to medicine and specifically anesthesiology
since he came to Washington six years ago.
It would be unwise, however, to assume that the Senator
in his new post is going to be out front carrying
the banner for Fee Schedule relief right out of the
legislative box. More realistically, his new duties
and announced legislative objectives are much broader
than that, and action on the Fee Schedule in the first
two months of the Congress will require broad Senate
consensus that the case for physician payment reform
is far more compelling than for other providers’
relief.
As of mid-January, it appears that the strong case
for relief being made by ASA and other physician groups
is having an impact. Shortly after the American Medical
Association-sponsored fly-in, House Ways and Means
Committee Chair William M. Thomas introduced House
Joint Resolution 3, which called for disapproval of
the CMS December 31 rule under the terms of the Congressional
Review Act (CRA). This act, which became law in 1996,
essentially provides for an accelerated process for
congressional review and possible disapproval of an
administrative regulation within 60 days after its
issuance.
Applied to the December 31 CMS rule, approval of the
resolution would roll back the 2003 Fee Schedule cuts
to 2002 levels, thus imposing a “freeze”
on Medicare physician payments until, most probably,
January 1, 2004. Because the CRA does not permit Congress
to deal selectively with particular provisions of
the regulation in question, this would mean that the
modest increase in anesthesia work values contained
in the 2003 rule would not be permitted to occur.
Despite loss of the anesthesia work increase, ASA
immediately endorsed the Thomas resolution. Rolling
back of the 2003 cut of 3.43-percent, as required
by the December 31 rule, would represent a net gain
of approximately $45 million to anesthesia providers
during the last 10 months of 2003, and there is no
reason to believe that the increase in anesthesia
work values, or something better, would not be included
in the 2004 rule.
Reaction by members of the Senate to the Thomas resolution
was on balance not favorable for a variety of reasons.
Some questioned whether the CRA was designed to deal
with Medicare update issues; others objected to the
draconian approach of the resolution, throwing out
the “good things” in the 2003 rule as
well as the bad. Most important, Senator Charles E.
Grassley (R-IA), chair of the all-important Finance
Committee in the 108th Congress, objected —
as he had at the end of the 107th Congress —
to providing interim relief for physicians without
also doing so for other providers, especially those
in rural hospitals.
On the evening of January 15, however, Senate Appropriations
Committee Chair Ted Stevens introduced an omnibus
2003 appropriations bill designed to complete the
appropriations process for the current fiscal year.
Included in that bill is an amendment to the Medicare
statute that would set the Medicare conversion factor
from March 1 to September 30, 2003 at the same level
as 2002, essentially the same goal sought by Chairman
Thomas in introducing his resolution. The amendment
also contains, however, modest relief for rural hospitals,
thus catering at least partially to Senator Grassley’s
wishes.
It is known that both Chairman Thomas and the Administration
are opposed to providing interim relief at this time
for any provider group other than physicians, so agreement
between the two Houses of Congress is far from certain
as this column is written. Through updates, Dr. Cottrell
will keep members advised as to developments.
If we cannot be certain that Congress will provide
prospective Fee Schedule relief before March 1, we
can be more certain that relief will come some time
during the first session of the 108th Congress. Senator
Frist has already announced that passage of a Medicare
prescription drug benefit will be among his highest
priorities, and it is well known that the White House
shares this view. Just as last June’s House
bill providing such a benefit included relief for
a spectrum of Medicare providers, so also it is highly
likely that a GOP bill in both houses this year also
will include such relief. In the last analysis, the
questions will be: how much, and how much for each
provider group?
Senator Frist also is known to be trying to develop
consensus among GOP senators for a federal professional
liability reform bill. Such a bill, supported by organized
medicine, passed the House in 2002 by a good margin.
The stumbling block, as always, is the Senate, and
even assuming GOP senators can agree on a bill and
receive expected administration endorsement, it is
by no means clear that proponents of reform can muster
the 60 votes necessary to block a Democratic filibuster.
It can safely be assumed that Senator John R. Edwards
(D-NC), a former personal injury lawyer and a possible
candidate for the Presidency, would like nothing better
than to gain wide media attention by spearheading
an effort to block the GOP bill.
ASA to Seek Pass-Through in
Smaller Rural Hospitals
Under existing Medicare Part A regulations as amended
effective last October 1, certain rural hospitals
are permitted to pay for the services of nonphysician
anesthetists on a reasonable-cost basis. This provision
is designed to provide inducement to nurse anesthetists
to locate in rural areas.
To qualify, a rural hospital must certify that not
more than 800 surgical procedures requiring anesthesia
are performed in a year, and nonphysician anesthetist
hours may not exceed 2,080 per year. In addition,
the nonphysician anesthetist must agree not to bill
Medicare Part B for services on a reasonable charge
basis, that is, under the Medicare Fee Schedule. The
anesthetist may be employed or work under contract
with the hospital.
Prior to October 1, 2000, the maximum number of surgical
procedures was 500. Because of this limitation, ASA
had not made any effort to seek amendment of the provision
to include anesthesiologists as well as nonphysician
anesthetists. The new maximum of 800 brings the annual
total number of cases closer to historic averages
for ASA members, and, as a consequence, this opportunity
to serve in rural areas — in which anesthesia
providers are generally in short supply — appears
to be of greater potential interest. During 2003,
ASA will be discussing an amendment to these regulations
with CMS in the hope that CMS can be persuaded to
include an appropriate provision in its next Part
A rule, extending the scope of the current reasonable
cost provision.
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