With the expansion of Medicaid and the individual mandate to obtain health insurance brought about by Health System Reform comes the need for expanded access to quality health care providers.   In an attempt to address the inevitable shortage of medical providers the Patient Protection and Affordable Care Act has called for the creation of a National Health Care Workforce Commission.   The legislation requires that this group be appointed and operational no later than September 30^th of this year and to prepare, the U.S. Government Accountability Office has been seeking recommendations for members throughout the summer. 

The Commission will be tasked with determining if the demand for health care workers is being met, identifying possible barriers to health care workforce development and making recommendations to Congress based on their findings.

Fifteen members will serve on the Commission, each appointed to three year terms by the Comptroller General. Health care professionals cannot constitute more than half of the workforce, leaving other seats open to representatives of employers, third party payers, health care economists, consumers, labor unions, educational institutions, and state or local workforce investment boards.

Legislators have penned specific priorities for the Commission to focus on throughout the course of their evaluations which include integrated workforce planning for nursing, oral, mental, public, allied, and emergency health providers.  Also of significance is the Commission’s ability to evaluate existing scopes of practice in the health care sector and make recommendations to Congress.

The creation of the National Health Care Workforce Commission is accompanied by a number of development grants for eligible State Workforce Development Boards to analyze local health care workforce needs and provide resources to help meet those needs. Individual providers may also apply for a number of workforce development grants or loan repayment programs.   Many of these opportunities are focused on growing the nursing field, however programs also exist to repay loans for pediatric and public health physicians as well.

The NCMS and the Western North Carolina/Buncombe County Medical Societies are hosting a Legislative Breakfast for physicians at the Doubletree Hotel in Biltmore on Monday, August 30, 2010, 7:30am – 9:00am. NCMS Director of Legislative Affairs Chip Baggett will be on hand to discuss the November 2010 Election and how physicians can become engaged in the political process to ensure their voice is heard during the 2011 legislative session and beyond. RSVP by emailing Jennie@bcmsonline.org.

The Patient Protection and Affordable Care Act expands state Medicaid eligibility to almost anyone under the age of 65 with income up to 133% of the Federal Poverty Line (FPL).  As of 2009, this percentage equals $29, 327 for a family of four.  A family of four with an income of 400%  of the FPL (approximately $88,000 per year)  will also be eligible for subsidies.  This drastically changes the current face of the Medicaid program, especially due to the inclusion of many childless adults. Taking into account the drastic mandate for eligibility and other new requirements of the law, the ultimate reach of the program will be heavily dependent upon implementation at the state level.

The North Carolina Institute of Medicine, together with the NC DHHS Secretary Lanier Cansler and NC Insurance Commissioner Wayne Goodwin, has convened a Medicaid Work Group to begin looking at the major changes ahead for the NC Medicaid program.

By 2014, the Department of Health and Human Services estimates over 500,000 new Medicaid enrollees due to expanded eligibility as well as current eligibles who are not enrolled at this time. Half of this influx will be comprised of childless adults.  Other sources have projected this number to be even higher based on past enrollment trends.

The Act allows states to implement the new eligibility category options today, but only at the original NC FMAP rates.  At this time the state does not plan to implement this option due to the loss of future federal matching funds.

The law as currently written requires the federal government to finance the majority of spending for newly eligible Medicaid enrollees.  States will receive 100% funding from 2014-2016, 95% in 2017, 94% in 2018, 93% in 2019 and 90% thereafter.  However, the state will be financially responsible for those who are currently eligible but who have not enrolled in the past. The law also requires states to maintain eligibility standards that were in place as of the date of passage (March 23, 2010).  

The Kaiser Family Foundation estimates that the state of North Carolina will spend anywhere from $1.02 to $1.8 billion during the first five years of Medicaid expansion. This will increase total spending on Medicaid from the current $12 billion to over $17 billon.  This range is based upon expected enrollment of the total eligibility ranging from 57-75%.  The federal government will pay the remaining 93-95% of costs, totaling $21-25 billion in North Carolina alone.  Under the new law states must also increase reimbursement for primary care procedures to 100% of Medicare payment rates. The federal government will cover the cost of the enhanced rate in 2013 and 2014.

The mass expansion of Medicaid coverage to over half a million new patients and the pending provider rates cuts at both the state and federal levels threatens patient access to care more than ever before. To address this challenge, we must stand together to ensure that the value of your services provided under the physician fee schedule is preserved.  State budget shortfalls and fallout from the recession should not be borne on the backs of the physicians and PAs that are providing the highest quality and most cost effective medical care to our Medicaid population.

Near the end of July, WellPath Select (“Wellpath”) received approval from the North Carolina Department of Insurance to amend the terms of the contracts it currently holds with physicians and practices in North Carolina.  WellPath crafted the Amendment in response to new fair contracting laws passed by the General Assembly in 2009, widely known in the health care community as Senate Bill 877.  According to WellPath’s Network Management team, notices and copies of the contract Amendment were mailed out during the last couple of weeks. 

Physicians and practices with concerns or feedback about the Amendment can contact the North Carolina Medical Society by emailing cbrockett@ncmedsoc.org.

The rate cut to the physician fee schedule for Medicaid enacted in September of 2009 has had a profound impact on many of our members’ ability to care for Medicaid patients across NC.  In addition, the 2010 State Budget passed just over a month ago placed physicians firmly on the chopping block should Congress fail to continue the increased Federal Medical Assistance Percentage (FMAP) funding that has occurred for the past 18 months. 

We are pleased that Congress took action this past week to continue FMAP funding as well as include unforeseen money specifically targeted for education.  Despite these developments, it is our understanding that the NC Department of Health and Human Services (DHHS) is announcing a new 1.35% rate cut to achieve the $26.6 million dollar reduction outlined in the contingency budget even in light of the windfall in federal funding.

The proposed cut is completely unacceptable.  Please review this letter sent to the Governor objecting to the new rate cut.  It is our hope that you will review this letter, make appropriate changes to identify yourself, and mail your own letter as soon as possible. 

Federal health reform will drive 500,000 new patients to the Medicaid rolls over the next couple of years. To address this challenge, we must stand together to ensure that the value of your services provided under the physician fee schedule is preserved.  The budget shortfalls and fallout from the recession should not be borne on the backs of the physicians and PAs that are providing the most cost effective medical care to our Medicaid population.

NCMS values your support and your attention to this matter.  We will continue to advocate for appropriate reimbursement so that Medicaid patients can continue to receive the best care available.

The North Carolina Medical Society (NCMS) hosted almost 100 physicians and consultants in Raleigh at the ACO Summit on Saturday, August 7, 2010.  Accountable Care Organizations (ACOs) are an emerging model for health care delivery for Medicare services under Health System Reform.  ACOs link groups of providers together to coordinate and improve quality and efficiency in health care by fostering greater accountability in the delivery of care.

ACO Summit attendees heard presentations offering perspectives on ACOs from the Brookings Institute, Crescent PPO, Community Care of North Carolina, Poyner and Spruill, LLP, and Smith Anderson.  Participants discussed how new business models can improve the delivery of health care and how physician participants can use existing successful programs as a foundation for ACOs.  The Summit also reviewed the NCMS current draft policy on Accountable Care Organizations, to be considered by the NCMS Board of Directors in September.

Presentations and materials from the ACO Summit can be found on the NCMS Health System Reform page http://www.ncmedsoc.org/healthreform. If you would like to offer feedback on the draft policy on ACOs or provide information on ACOs being developed in your area, please complete and submit the feedback form also found on the Health System Reform page.  Please submit feedback regarding the draft policy by August 30, 2010.

The North Carolina Institute of Medicine has established eight Health Reform Workgroups that will serve under an NCIOM Advisory Committee. The new effort will be led by NC Department of Health and Human Services Secretary Lanier Cansler, and NC Insurance Commissioner Wayne Goodwin.  The goal of these groups is to identify the decisions that the state must make in implementing health system reform.  This initiative will also identify potential funding opportunities that will improve health, access to care and quality of care in North Carolina.

The eight workgroups that have been established will focus on: Prevention, Safety Net, Health Professional Workforce, Health Insurance Exchange and Insurance Oversight, Medicaid, New Models of Care, Quality, and Fraud and Abuse.  Each group will meet approximately once a month for the next year.  Meetings are open to the public and NCMS staff will attend each meeting. A calendar of meeting dates and times is available by visiting the North Carolina Institute of Medicine Website at http://www.nciom.org/calendar.php.

Events/meetings involving NCMS staff working on your behalf this week.

Beginning in 2014, the federal government will be able to sidestep Congress and impose its own cost-containment policies for the Medicare program through the creation of the Independent Payment Advisory Board (IPAB).  The IPAB will consist of 15 members, appointed by the President with the consent of the Senate.  The IPAB must include physicians and other health care providers in its membership as well as representatives for consumers and the elderly.  Individuals who are directly involved in providing or managing the delivery of Medicare items and services may not constitute a majority of IPAB’s membership.  Also, IPAB members may not be engaged in any other business or be employed elsewhere, which could limit the pool of potential candidates.

By April 30^thof each year (beginning in 2013), if the Centers for Medicare & Medicaid Services (CMS) determines that per capita spending outpaces the average of the Consumer Price Index (CPI) for all urban consumers and for all urban consumers’ medical care, the IPAB will be charged with making recommendations to Congress on ways to cut Medicare expenses which could include cuts to the physician fee schedule. Beginning in 2019, the target criteria will change to be based on the nominal gross domestic product per capita, plus one percent. Spending rate reductions are currently:

• .5% in 2015
• 1% in 2016
• 1.25% in 2017
• 1.5% in 2018 and beyond

The IPAB must submit its spending reduction recommendations to Congress by January 15^thof each year.  If Congress fails to take action to approve the IPABs recommendations or pass its own legislation to reduce costs within 6 months, CMS must enact the measures the IPAB has proposed, doing so no later than August 15^th of the same year.

 There is no guarantee that IPAB recommendations will succeed in reducing growth by the required amount and there could be a significant bubble effect as cuts in one area are balanced by increased growth elsewhere.  IPAB’s ability to constrain spending may also be limited by factors beyond its control, including:

• Hospitals and hospices are “off limits” for IPAB recommendations (except changes to Medicare Advantage) until 2020.
• Clinical labs are exempt for one year.
• Changes that might raise premiums or revenues, increase beneficiary cost-sharing, restrict benefits, modify eligibility criteria, or ration healthcare are excluded.
• The growth rate reduction percentages that will be invoked are less than the expected rate by which Medicare growth will exceed CPI targets, which could lead to the implementation of short term fixes.
• Congress may, at any time, make changes to Medicare that increase spending.

The Congressional Budget Office (CBO), assuming that targets will be met, estimates Medicare spending to be reduced by $15.5 billion over five years. However, the CMS Chief Actuary has already commented that the target growth rates may be unachievable.

The creation of the Independent Payment Advisory Board is one of the more controversial provisions in the Patient Protection and Affordable Care Act and stands to impact the Medicare physician fee schedule more than any other portion of the act.

The 2010 Legislative Short Session officially adjourned at 5:32 am on Saturday, July 10, following a marathon session that included debate and amendments to key bills considered during the final hours. The primary focus of the past 9 weeks has been balancing the State budget during a time of unprecedented revenue shortfalls. For a breakdown of the General Assembly’s budget as it relates to Medicaid funding, as well as a recap of major legislative issues of interest to the NC Medical Society, please click here.

The North Carolina Medical Society is among several specialty organizations and state medical societies that have expressed “strong support” for HR 5295, the Healthcare Truth and Transparency Act of 2010. The coalition endorsed the measure in a letter sent May 12, 2010 to U.S. Representatives John Sullivan (R-OK) and David Scott (D-GA), co-sponsors of the bill.  The legislation seeks to ensure that patients have access to accurate information regarding the education, training and qualifications of health care providers.

Budget:

There is a lot to be said about the new budget just enacted by the NC General Assembly. This was arguably the most difficult budget year in modern times for health-related issues. Medicaid funding was already seriously undermined by the actions of the NC General Assembly and the NC Department of Health and Human Services in 2009. Moreover, Congress has not yet extended supplemental funding to deal with ballooning Medicaid enrollment during the economic downturn (known as Federal Medical Assistance Percentage, or FMAP). If not ultimately approved by Congress, North Carolina will lose up to $500 million in Medicaid funding in 2010-11.

To address this problem, the NC General Assembly chose to enact contingency provisions in the budget. It is in the contingency budget that physician Medicaid payments are being targeted. In addition to the $82 million planned cut from 2008-09 levels, enacted in last year’s 2009-10 budget (which, incidentally, was arbitrarily increased to $101 million by North Carolina DHHS), the General Assembly cut rates in the contingency budget by another $26.6 million. The NCMS, working within a coalition of medical organizations, was able to insert two provisions in the final budget to minimize the damage.

First, if the federal funding is approved to help with ballooning Medicaid enrollment, there will be no further reductions in the rates paid to physicians. While this obviously does not address our goal of maintaining physician unity, equalizing rates for all specialties in Medicaid, and protecting the primary care “engine” (CCNC) that produces savings for the whole program, it does take further cuts off the table if adequate FMAP funding is enacted by Congress.

Second, a provision was added to make clear that the only reduction to physician rates that will occur in the contingency budget is the $26.6 identified by the General Assembly. Other across-the-board cuts in the contingency budget will not apply to Medicaid rates. The Secretary of NC DHHS has discretion, however, regarding the implementation of rate cuts in the contingency budget, and could implement the cuts even before Congress had finished debating the question of supplemental funding. NCMS and the coalition pushed for protection from further cuts if the Secretary determines that early implementation of the contingency budget is necessary, but the General Assembly did not provide that protection.

The NCMS will continue fighting to restore reasonable fees for services provided to Medicaid enrollees.

Scope of Practice:

Physical Therapy – Within the physician community, there has been tremendous interest in efforts by the national PT advocacy groups to eliminate physician-owned PT services (POPTS). The PTs have been successful in a few states. Recent proposals by PTs in the NC General Assembly, if passed, would move North Carolina closer to prohibiting POPTS. The NCMS supports POPTS and has worked to ensure this option continues to be viable in North Carolina. There has also been concern about the use of electrodiagnostic testing by PTs. Today, the PTs claim authority to perform the tests based on a letter once sent to the PT Board by the NC Medical Board. According to the Board’s letter, PTs are prohibited from making a medical diagnosis based on the test. The PT proposal would have added electrodiagnostic testing and diagnosis to their scope of practice. NCMS does not support those provisions. To address our concerns, we negotiated several provisions in this year’s PT bill. The bill did not move because the PTs were not able to resolve concerns raised by the Athletic Trainers regarding their role in delivering PT services.

Midwifery – The Joint Midwifery Committee, organized to regulate nurse midwives, was asked by the General Assembly in 2009 to consider recommendations for the licensure of lay midwives in North Carolina. The committee met throughout the period between the 2009 and 2010 sessions of the General Assembly. In its final recommendations, the group did not recommend licensure of lay midwives. This is attributable to the excellent work of the physicians who participated in the study, and the physicians and other individuals who worked on the issue for the NC Ob/Gyn Society and NC Medical Society.

Naturopathy – For the seventh consecutive year, the licensure of naturopathic practitioners has been proposed. After opposing the measure for several years, the NCMS, in 2006, spelled out some conditions under which it could remove its opposition to licensure of some naturopathic practitioners. The NCMS naturopathy white paper has been widely circulated to educate legislators and others involved in the debate. The naturopaths promoting the legislation, who have better training than the naturopaths opposing the legislation, initially agreed to the preconditions identified by the NCMS. Since then, there has been persistent controversy regarding a number of issues related to patient safety. The NCMS has continued to oppose bills that do not meet its preconditions. Again in 2010, NCMS opposed naturopathy licensure legislation proposed by Sen. Ellie Kinnaird (D, Orange). The bill did not move during the 2010 session.

Uniform Apportionment of Tort Responsibility Act, (a.k.a. Repeal of Contributory Negligence):

The NCMS worked within a coalition of business representatives to address concerns with a proposal made by the NC Advocates for Justice (i.e., the plaintiffs’ bar) to move from a contributory negligence to a comparative fault system in North Carolina. NC is one of four jurisdictions in the United States that has a contributory negligence statute on the books, barring a plaintiff from recovery if they negligently contributed to their own injury.  In contrast, comparative fault systems permit plaintiffs to recover from others even if they are partially responsible for their own injury.  

The legislation passed the House in 2009, and was then referred to a subcommittee in the Senate for study. The last proposal from the subcommittee contained several provisions that were unacceptable to the coalition. The coalition proposed changes that were reasonably aimed at addressing genuine concerns, and that ensure a balanced civil justice system for North Carolina. Throughout the coalition’s discussions, the NCMS advocated for a balanced proposal that addresses the concerns of the medical profession.  One provision in the coalition’s proposal supported by NCMS is a proposal to allow juries to hear accurate information about the amounts actually paid by injured parties for past medical care, rather than hearing only about full charges before contractual and government reductions. The balanced proposal offered by the coalition was rejected by the plaintiff’s bar. The bill ultimately failed to get a hearing in the Senate, and the session ended without further action on the bill. There is a provision in the study bill, however, that is likely to bring this issue back before the General Assembly in 2011.

It appears that the 2010 session of the NC General Assembly will adjourn in the middle of the night—or to be more precise, sometime in the early morning hours of Saturday, July 10, 2010.  Your NCMS government affairs team will be there until the final gavel falls and the session ends. 

Several bills of interest to physicians are pending, and we will be providing updates on the Doctor to Doctor Blog. A summary of this week’s legislative activities will be coming in a special posting the first of the week on the NCMS website.

With just hours to go before the end of the fiscal year lawmakers passed a revised state budget on Wednesday.  Physician participants in White Coat Wednesday from Wayne, Wake and Mecklenburg Counties met with their legislators to discuss Medicaid provider rates and the detrimental effects of the additional cuts to Medicaid proposed in the supplemental budget, should Congress fail to extend additional Medicaid stimulus funding (FMAP).

Even though the budget has been signed by Governor Perdue, there is still time for technical changes to be made to the budget before legislators adjourn session. This is why your advocacy is more important than ever right now.  This budget includes deeper cuts to reimbursement for your service than was expected in the base budget as well as targeting you in a short list of additional cuts that will be enacted on January 1, 2011 should Congress fail to provide renewed assistance. 

NCMS believes that physicians should be exempted from the additional cuts outlined in the budget.  Physicians have taken one of the largest percentage reductions of any single group in the budget all the while being expected to save the state an additional $245 million dollars through the Community Care of NC (CCNC) program.  Click here for talking points to call your legislator now.

Here are three Medicaid rate cuts of top concern to physicians:

Base Budget reduction

1. Continuation of the 9% Medicaid provider rates reduction established last year.  This will achieve $101 million dollars in savings for the state.  DHHS was only expected to save $82 million in this budget year.  By continuing the existing rate cut, providers will already be contributing nearly $19 million in new savings that were hidden in this budget. 

Supplemental budget reductions (enacted if Congress fails to extend FMAP)

1. $26.6 million cut to Medicaid provider rates – sold as 1% reduction, but NCMS expects this to be greater than 1% because of the groups exempted from the cut
2. $177 million or 1% management reduction across all Departments – $40 million of this target is expected to be placed on DHHS – NCMS is working to ensure that this savings cannot be achieved on the backs of the providers that would already be sacrificing over $125 million dollars should this cut be necessary.

A complete run down of provisions in the 2010-2011 Continuation Budget will be forthcoming in our Legislative Summary.

Signatures are still being sought for the Stop the Medicare Meltdown petition campaign being led by the Texas Medical Association.  The NCMS and other state organizations have joined in the campaign in an effort to get Congress to permanently repeal using the sustainable growth rate (SGR) to determine Medicare physician reimbursement fees. Current plans call for presenting the petition to Congress following its August recess.

Physicians and patients can sign the petition online, and a downloadable flyer is available to encourage patients to participate.

President Obama signed HR 3962 into law last Friday, after the House and Senate agreed to a six-month delay in the proposed cut to Medicare physician fees. The law included a 2.2 percent update in the Medicare fee schedule for physician services through November 2010. Reacting to the latest Congressional delay, AMA President Cecil B. Wilson, MD, said, “In December, the Medicare physician payment cut will be a whopping 23 percent, increasing to nearly 30 percent in January…Congress must replace the broken payment system before the damage is done and cannot be reversed.”

As the law took effect, the Centers for Medicare and Medicaid Services issued an update on how June Medicare claims would be processed.

The NCMS continues to ask the North Carolina Congressional Delegation to repeal the SGR. Click here to contact your Representative or Senator today.