ACR Vigilant Over 109th Congress
Since the 109th Congress commenced in January, the ACR's government relations staff has been working closely with Congress and the Bush administration on several issues concerning Medicare physician payment policy, including the utilization of diagnostic medical imaging studies and the sustainable growth rate (SGR). In addition, medical liability reform continues to be a legislative priority.
Overutilization of Imaging Services
In January, the ACR achieved a significant victory in terms of curbing imaging utilization when the Medicare Payment Advisory Commission (MedPAC), the congressional advisory committee for Medicare, unanimously agreed to recommend that Congress direct the Secretary of the Department of Health and Human Services (HHS) to set standards for physicians who bill Medicare for interpreting diagnostic medical imaging studies, and set standards for providers who bill Medicare for performing these studies. Such standards would be administered by a private organization, such as the ACR, and would cover quality, safety, education, training, and experience. MedPAC officially published these recommendations in its March 2005 report.
Policy makers are certainly aware of the rapid growth in the volume of diagnostic medical imaging services. Because Congress is determined to reduce the federal budget deficit, it sees potential savings in the Medicare program. The government relations staff has met with many members of the Senate Committee on Budget, Committee on Finance, and Committee on Health, Education, Labor, and Pensions, as well as the House of Representatives Committee on Budget, Committee on Energy and Commerce, and Committee on Ways and Means to advocate for a policy that would provide savings while improving quality and safety for patients.
Data made available to the ACR suggest the implementation of a policy similar to MedPAC's recommendation will produce significant cost savings—a conservative estimate suggests nearly $6 billion over a 10-year period. In the eyes of Congress, this is "real money" and could prevent them from enacting across the board cuts in Medicare physician fee reimbursement, especially in imaging services. The threat of these cuts has forced the College to take the lead role on this issue and serve as a resource for Congress and the administration.
The ACR supports MedPAC's policy, but has been encouraging Congress to limit the scope of the policy to high-cost imaging modalities such as computed tomography (CT), magnetic resonance imaging (MRI), and positron emission tomography (PET) studies, except when such service is provided for the purpose of radiation therapy treatment planning or image-guided therapy. Notwithstanding lobbying for the implementation of stringent standards for the performance and interpretation of these imaging studies, the College is working to preserve patient access to quality care. The ACR is urging Congress to continue to permit the interpretation of clinical images via teleradiology, as well as to direct the Secretary of HHS to provide alternative standards for rural or medically underserved areas as necessary.
Congress has been fairly receptive to this policy because of the impressive savings it should bring. On March 17, 2005, the Subcommittee on Health of the House Committee on Ways and Means conducted a hearing on managing the use of imaging services, which focused on the MedPAC recommendations. Despite the interest on the part of Congress, it is unclear whether there will be a legislative vehicle to implement this policy until 2006. President Bush has urged Congress not to delve into Medicare until the Part D prescription drug program begins next year (see related article on page 3). As a result, the ACR is scheduled to meet with CMS to explore the possibility of administrative action to implement this policy through the rulemaking process.
Fixing the Sustainable Growth Rate Problem
In February, the Health Subcommittee of the House of Representatives Committee on Ways and Means conducted a hearing on Medicare payments to physicians; the ACR submitted testimony.
During the hearing, 2 potential solutions for the SGR were discussed: (1) elimination of the SGR (the Congressional Budget Office (CBO) estimates that will cost $135 billion over 10 years); or (2) retroactively removing prescription drugs from the formula (CBO estimates that will cost $119 billion over 10 years). During the question portion of the hearing, Bruce Steinwald from the Government Accountability Office (GAO) mentioned that CMS could take outpatient prescription drugs out of the formula on its own through the rulemaking process without congressional mandate. The American Medical Association (AMA) favors this approach, while MedPAC wants Congress to eliminate the SGR.
The SGR, which has been in place since 1998, sets spending targets and adjusts physician fees based on the extent to which actual spending aligns with specified targets. According to an October 2004 GAO report, Medicare spending for physician services in 2003 totaled nearly $48 billion, which accounted for about one sixth of program spending overall. The SGR system targets are designed to allow spending per beneficiary (adjusted for the estimated underlying cost of providing physician services) to grow at the same rate as the national economy grows over time on a per capita basis. High growth in volume and intensity of services caused spending to exceed the SGR target; therefore, future fee updates are set below the estimated increase in physicians' average costs. If the gap between spending and the target is wide enough, the SGR results in fee reductions.
At the hearing, MedPAC testified that the SGR is a flawed volume control mechanism. Because it is a national target, there is no incentive for individual physicians to control volume. Moreover, it is inequitable because it treats all physicians and regions of the country the same, regardless of individual volume-influencing behavior.
In 2002, Medicare physician fees were reduced by 5.4% because spending exceeded predetermined spending targets. While administrative and legislative action has overridden the SGR for 2003–2005, physician fees are expected to fall by approximately 5% each year from 2006 until 2012. Because of the high costs to remedy the SGR problem, many members of Congress are hesitant to add billions of dollars to the deficit; therefore, another 1-year fix is likely. The government relations staff will continue to monitor this issue.
Medical Liability Reform
The ACR has been working closely with the AMA and other medical specialties in developing a solution to the medical liability crisis. The government relations staff is participating in the AMA's medical liability reform work group and recently discussed this issue with Senate leadership.
During the 108th Congress, the Senate Republicans failed on 3 occasions to achieve cloture—which is a Senate procedural rule that limits consideration of a pending matter to 30 additional hours if agreed to by three fifths of the full Senate—usually 60 votes—on medical liability reform legislation. Senate Republican leadership in the 109th Congress will not bring medical liability reform legislation up on the Senate floor until they have the requisite 60 votes to proceed. Even if they obtain the votes, leadership admits they currently do not have 50 members who would vote on the type of legislation modeled after California's Medical Injury Compensation Reform Act of 1975, which, among its other reforms, places a $250,000 cap on the amount of noneconomic damages that may be awarded in a medical malpractice lawsuit. This cap, and limiting attorney contingency fees, appears to be the chief stumbling block, yet this is the type of legislation that continues to be introduced.
On February 10, 2005, Judd Gregg (R, NH) chair of the Senate Committee on the Budget, and Sen John Ensign (R, Nev) introduced 3 pieces of legislation: S 354, which is a comprehensive reform package; S 366, which applies strictly to obstetricians/gynecologists; and S 367, which is limited to both obstetricians/ gynecologists and trauma surgeons. Gregg and Ensign championed this issue during the 108th Congress and continue to work on behalf of the medical community. While the 3 bills differ in scope, all are modeled after the California law. The Senate has not yet taken action on these bills because they would likely fail to obtain cloture.
A politically successful approach in the Senate would probably have to include a cap on noneconomic damages of $500,000 with an exception that would increase the cap to $1 million for catastrophic injuries. The AMA opposes this larger cap. Requiring a certificate of merit, which would prohibit victims from bringing a medical malpractice lawsuit without an affidavit from a qualified specialist attesting to the reasonableness of the filing, as well as the attorney representing the claimant attesting to the legitimacy of the claim, is good policy and a compromise Senate Republican leadership would likely accept.
Rep Chris Cox (R, Calif) has introduced the lone medical liability reform bill in the House, HR 534. This bill is identical to HR 5, which was modeled after the California law and successfully passed the House during the 108th Congress. House leadership is expected to bring medical liability reform to the floor in the spring.