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Dear Colleagues:
After a year of hearings, debates and votes, it appears that we are rapidly approaching an end to the Congressional health reform debate. Through either passage or defeat, most observers believe the debate will conclude within the next three to five weeks. I am writing to provide you an update on the current status of the issue in Washington, D.C.
As you know, President Barack Obama and the Democratic leadership of the U.S. Congress have stated their intention to have both the U.S. Senate and House of Representatives pass a health care reform bill by the Congressional Easter/Passover recess. While this timeline is considered optimistic by many observers, ASA members should nevertheless be prepared for the possibility of a series of votes on health care reform proposals later this month or early next month.
Under the current “two bill, two track” legislative strategy envisioned by Democrats, a “reconciliation bill” will be paired with H.R. 3590, the “Patient Protection and Affordable Care Act,” the health reform bill previously passed by the U.S. Senate on December 24, 2009, to enact the Democrats’ vision of reform.
While the exact timing and sequencing of the process have not yet been announced, a “reconciliation bill,” which is currently being drafted, would modify or “correct” the Senate bill to include the changes proposed by President Obama (link below) as well as changes sought by key Democrats in the House of Representatives. Once written and finally reviewed by the Congressional Budget Office (CBO) for budgetary impact, the reconciliation bill would then face consideration under special rules in the House and Senate. The special rules would protect the bills from dilatory tactics including a filibuster in the Senate. Only 51 votes would be required for passage in the Senate.
Once the reconciliation bill is passed, the House would then consider H.R. 3590, (or vice versa). Because H.R. 3590 previously passed the Senate, additional Senate consideration would not be required. If passed, both the reconciliation bill and H.R. 3590 would then be sent to the President for his signature.
ASA has significant reservations about both the underlying bill, H.R. 3590, and the emerging "reconciliation bill" that modifies or "corrects" it.
When first introduced and considered by the Senate in December of 2009, H.R. 3590 was the subject of concern by virtually every major national surgical association. In fact, ASA joined 18 surgical groups in the surgical coalition to raise specific and commonly-held concerns about provisions of the bill (link below). A number of those organizations, including ASA, ultimately urged a "no" vote during Senate floor consideration.
While the Senate bill includes many laudatory provisions, it was also fundamentally flawed with regard to the financing of the expansion of health coverage for the under- and uninsured. Simply put, unlike the House companion reform bill, H.R. 3962, the Senate bill finances its reform largely on the backs of the physician community. Among other provisions, the bill includes the establishment of an Independent Payment Advisory Board or IPAB (Sec. 3403 and 10320). If enacted into law, the IPAB would be tasked with reducing Medicare per capita expenditures principally by targeting Medicare spending for physician services. Recommended payment cuts would move expeditiously through Congress with Congress itself and the medical community having little opportunity to modify the Board’s recommendations. Perhaps even more disconcerting, the IPAB would also have unprecedented authority to make recommendations regarding spending in the private health care marketplace.
Other provisions of the Senate bill similarly target physician payments. One provision (Sec. 3002) would modify the still unproven Physician Quality Reporting Initiative (PQRI) through the addition of Medicare payment reductions for non-compliant physicians. Another provision (Sec. 3134) creates a new entity within the U.S. Department of Health and Human Services directed to develop even more payment changes for so-called "misvalued" physician services. The Senate bill also seeks to push forward with untested bundling initiatives (Sec. 3023). For whatever political or policy reason, funding for physician services is a significant target of the Senate's reform proposal. These provisions could adversely impact anesthesiology’s already low Medicare payment levels, i.e. “the 33% problem.”
Beyond payment provisions, the Senate bill also includes gratuitous so-called “non-discrimination" language (Sec. 2706). The intentionally vague language, inserted by supporters of paraprofessionals, seeks to prevent health insurers from "discriminating" against non-physician providers in deciding who may participate in their plans. Its practical implications are to open the doors to various disruptive tactics within the insurance marketplace by paraprofessionals, putting Federal law on a collision course with each state’s scope of practice law.
ASA also has raised concerns about the Senate bill's expansion of Medicaid eligibility without a corresponding recognition of the longstanding physician payment problems inherent to the program.
With regard to the second piece of the reform initiative, a reconciliation bill, much remains unknown. Efforts are underway to craft the legislation behind the closed doors of Congress and only some provisions, such as those proposed by the President prior to the Blair House reform summit, are publicly known. At this time, it does not appear likely that any of the provisions currently under discussion will “correct” concerns identified by physicians in the underlying Senate bill. In fact, some proposals likely to be considered in the reconciliation piece could exacerbate physician concerns. For example, the addition of the President's proposal to create a "Health Insurance Rate Authority" is laudable on its face as a mechanism to address health plans’ excessive executive compensation and stock profits. But at the same time, this new mechanism could be used to push for reduced payments for physicians in the commercial market place. Additional information on this and other provisions will be necessary before full evaluation of the bill will be possible.
While much of this correspondence references provisions included or thought to be included in the two reform pieces, there are two proposals that are notable in their absence. First, meaningful reform of the Sustainable Growth Rate (SGR) Medicare physicians update mechanism, an issue which has become a shameful political football kicked about by both Democrats and Republicans, is nowhere to be found in either H.R. 3590 or in discussions concerning the reconciliation bill. Indeed, it is looking increasingly likely that a separate non-health related bill will carry a 7 to 10 month SGR "patch” to enactment. The obscenity of undertaking reform of the nation's entire health care system without addressing the flawed mechanism that funds health care services to tens of millions of Medicare beneficiaries is startling and gravely disappointing. Moreover, because of the nature of the SGR formula, the ability to actually fix the formula grows more difficult with each passing year. Congress' failure to include much needed change as part of its reform efforts could signal a future of one year or less "patches" in perpetuity - an outrageous prospect.
The second proposal notable for its absence is the proposal included in H.R. 3200, “America's Affordable Health Choices Act of 2009,” and supported by many Democrats that sought to create a public health insurance option that paid providers at rates consistent with Medicare rates. ASA successfully led the medical community in opposition to the proposal. Due in part to the aggressive action of ASA’s grassroots members the proposal was eliminated from subsequent reform bills – a major win for practicing anesthesiologists. Should the proposal have prevailed during the reform debate, Rep. Eddie Bernice Johnson (D-TX) was poised to advance an amendment specifically carving-out anesthesia services from any Medicare-based public plan.
Turning now to the prospects for enactment of reform, it has been widely reported and confirmed by ASA's lobbyists that the votes necessary to pass either or both pieces of the Democrat's reform initiative have not yet been identified. With a current count of approximately 185 "yes" votes of a needed 216, additional votes will need to be secured to ensure passage. The President and the Democratic leadership are expected to continue to push aggressively for individual lawmaker support in the coming weeks culminating with a series of final votes within the next three to five weeks.
ASA members should stand-by in anticipation of an ASA “Call to Action” once the process and content of the reform initiative is finalized.
Alexander A. Hannenberg, M.D.
President, American Society of Anesthesiologists
