Videos posted on YouTube are helping to emphasize the urgency to repeal Medicare’s flawed sustainable growth rate (SGR) formula that is used to set physician reimbursements. The AMA released the videos as the March 1 deadline approaches for Congress to prevent a more than 27 percent cut in Medicare physician payments.

The videos—one geared toward Congress and the other toward seniors—warn that temporary patches to the SGR threaten access to care and choice of physician for seniors while increasing the taxpayer burden. The Congressional Budget Office has estimated that it will cost $298 billion to fix the SGR, with the cost continuing to rise as long as Congress continues to apply only temporary patches. The AMA projects that the cost will rise to $320 billion if Congress does not act in 2012.

As reported in the Bulletin last week, the NCMS has joined other physician organizations in calling on Congress to repeal the SGR by using excesses from Overseas Contingency Operations (no longer needed for wars in Iraq and Afghanistan). See Physician Organizations Propose Offset for Congress to Repeal SGR.

NCMS urges you to please take a moment to send an e-mail to your Senators and Congressman to let them know that it is time to fix the broken SGR. We need a permanent fix.

CapWiz call for action here. Contact your legislators today.

The NCMS joined with 47 physician organizations this week to ask Congress to repeal Medicare’s sustainable growth rate (SGR) formula by using excesses from Overseas Contingency Operations (no longer needed for wars in Iraq and Afghanistan).

In a letter to House Ways and Means Committee Chairman Dave Camp (R-Michigan), the organizations stated, “This long-stated goal of Congress (SGR repeal) is now within reach, and we urge you to take advantage of it immediately by using excess baseline projections for Overseas Contingency Operations (OCO) to help offset necessary Medicare baseline changes.“ The letter adds that further delays will only make future cuts deeper and more expensive to solve.

The Congressional Budget Office (CBO) projects that the cost of repealing the SGR is $290 billion and growing. The AMA says a two-year SGR patch will cost $39 billion in 2012, increasing the cost of repeal to $346 billion and expanding the size of the next scheduled cut to physician payments to 36 percent. Just before Christmas, Congress delayed a 27.4 percent cut, from January 1 to March 1, 2012. That cut is still pending.

Click here to read the letter.

NCMS urges you to please take a moment to send an e-mail to your Senators and Congressman to let them know that it is time to fix the broken SGR. We need a permanent fix.

CapWhiz call for action here. Contact your legislators today.

The Centers for Medicare and Medicaid Services (CMS) is currently developing the 2012 Medicare Physician Fee Schedule (MPFS) to implement the zero percent update that was included in the Temporary Payroll Tax Cut Act signed by President Obama on December 23, 2011. As previously announced, Medicare claims administration contractors will hold new January 2012 claims for up to 10 business days in order to effectively test and implement the new 2012 MPFS. CMS expects these claims to be released into processing no later than January 18, 2012. Claims with dates of service prior to January 1, 2012, are not affected. NC Medicare contractor Palmetto GBA will be posting new rates on its website no later than January 11, 2012.

NCMS President Robert W. Monteiro, MD, addressed the need to fix the SGR in a letter that was published in the New Bern Sun-Journal on December, 27, 2011. The NCMS and the AMA support a proposal that would leave Medicare physician reimbursement at current levels for two years, giving Congress time to repeal the SGR and develop a plan that would establish a reimbursement structure that meets the actual costs of physician services. Under the SGR, the gap between physician costs and Medicare reimbursement has grown dramatically wider over the past ten years, putting the cost of reforming the SGR at $298 billion at the end of 2011. The AMA projects the costs will grow to $320 billion if Congress fails to act in 2012.

US Supreme Court Schedules PPACA Oral Arguments for March

The US Supreme Court announced Monday that it will hear arguments on the Patient Protection and Affordable Care Act March 26-28, 2012, devoting an unprecedented full week to address the constitutionality of the federal health care reform law. The first day of arguments on March 26 will focus on whether Congress can require all Americans to purchase health care insurance or pay a fine. Arguments on March 27 and 28 will consider whether the remainder of the federal health care law can take effect if the mandate is ruled to be unconstitutional, and whether the federal government can cut off funding to states that refuse to participate in the federal health care reform plan.

Uncertainty over Medicare Physician Fee Schedule Prompts Hold on 2012 Medicare Claims in January

Palmetto GBA, the Medicare Administrative Contractor (MAC) for North Carolina, will hold claims containing 2012 services paid under the Medicare Physician Fee Schedule for the first ten business days of January. CMS announced the action on Tuesday as Congress continued to grapple with whether to delay 27.4 percent cuts in physician reimbursements scheduled to take effect January 1, 2012. The US Senate voted Saturday to delay the cuts until March 1, 2012, but the issue remained unresolved in the House as the Bulletin went to press today. It’s part of a legislative package involving a payroll tax provision and unemployment benefits.

NCMS is closely monitoring this situation and will provide updates from CMS and Palmetto GBA as they become available. Updates will be provided on the NCMS Website and in the Bulletin.

More information is also available from Palmetto GBA at: http://www.palmettogba.com/palmetto/palmetto.nsf/DocsCat/Home.

NCMS Opposes Proposed Revisions to Hospital Conditions of Participation (CoPs)

The NCMS has joined with other state and national physician organizations in opposing some proposed changes to the conditions that hospitals must meet to participate in the Medicare and Medicaid programs. In a letter to Acting CMS Administrator Marilyn B. Tavenner, RN, MHA, the organizations expressed support for CMS’ efforts to identify and eliminate burdensome regulations. However, they expressed concern and opposition to some specific revisions to CoPs involving medical staffs and governing bodies:

• Detrimental impact to the health and safety of patients in the hospital setting if CMS adopts proposed changes to the medical staff and governing body CopS, and lack of statutory authority for CMS to do so.
• Support for medical staff self-governance for each hospital within a multi-hospital system and not a single and separate staff for all hospitals in the system.
• Support for medical staffs to perform the important function of peer review and not a single medical staff that has little familiarity with the standard of care in that physician’s community.
• Opposition to a proposal to that would divide a hospital’s physicians into two distinct groups: those who are members of the medical staff, and those who are not. The organizations believe this would allow hospitals to grant privileges outside the medical staff and have a negative impact on peer review and raises concerns about possible fraud and abuse.
• Objection to CMS’ endorsement of the replacement of physicians with non-physician practitioners throughout the proposed rule, and the CMS’s effort to encourage states to widen their scope of practice laws.
• Revision of a proposal that would allow a governing body to grant privileges in accordance with hospital policies and procedures without the recommendation of the medical staffs.
• Support for each hospital facility to have a separate governing body and opposition to a proposal that would allow hospitals in multi-hospital systems to be governed by a single governing body.
• Opposition to a proposal to allow podiatrists to hold leadership positions within the medical staff of any hospital.
• Support for a proposal that provides for all orders, including verbal orders, must be dated, timed, and authenticated promptly by the ordering practitioner or another practitioner who is responsible for the care of the patient.

Click here to read the letter, to be delivered December 23, 2011.

The NCMS staff wishes you Seasons’ Greetings as we look forward to serving you in 2012.

The US House and Senate are expected to vote today on a $1 trillion interim spending package that was crafted last night by the House and Senate Appropriations Committees. The package includes a tweak to a proposal to extend the Medicare physician reimbursement rate, in order to delay a 27.3% cut scheduled to take effect January 1, 2012. Also included are higher Medicare premiums for upper-income seniors. The spending plan was worked out only hours before the deadline that could have led  a government shutdown after midnight tonight.

The NCMS and AMA continue to advocate for a repeal of the sustainable growth rate (SGR) that has resulted in scheduled cuts to physician Medicare reimbursements. Over the past decade, Congress has chosen to apply short-term delays rather than address the SGR fix, causing a steady and dramatic increase in the size of the cuts. The NCMS urges physicians to contact members of the North Carolina Congressional Delegation and ask what steps they plan to take to fix the broken SGR and improve the fiscal sustainability of the Medicare program, so seniors will have continued access to health care.

House Set to Vote Next Tuesday

The US House is expected to vote December 13 on legislation that will include a two-year extension of the current Medicare physician pay rates, including a one percent increase. The plan is part of a larger bill that seeks to address an expiring payroll tax, according to a report in Modern Healthcare. Rep. Phil Gingrey (R-Ga.), co-chair of the Republican Doctors Caucus, revealed the plan in an interview with the magazine. He said that a permanent fix to the sustainable growth rate (SGR) was unlikely this year, but Congress would have time to develop a replacement over the next two years. Rep. Gingrey said the House plans to adjourn December 19, and it’s not known whether the Senate will support the House bill.

Medicare physician fees are scheduled to be cut by 29.5 percent on January 1, 2012, unless Congress acts to delay the cuts, as it has done on several occasions in recent years.

This week groups representing hospitals and health care systems urged lawmakers not to reduce Medicare payments to hospitals or Medicaid funding as a means to offset steep cuts in Medicare physician payments. Click here to read the letter, as published in Modern Healthcare on December 7, 2011.

Organized Medicine Continues Fight for SGR Elimination

The NCMS and AMA continue to advocate for a permanent solution and are urging lawmakers to utilize the Overseas Contingency Operations (OCO) funding to offset elimination of the SGR. OCO funding refers to discretionary funds for the wars in Afghanistan and Iraq and similar activities. The Department of Defense (DOD) establishes funding levels for the OCO each year. Even though operations in Iraq and Afghanistan are winding down and are expected to continue winding down significantly over the next ten years, the Congressional Budget Office (CBO) cannot downwardly adjust its estimate for OCO spending over the next ten years until the next (FY 2012) Defense Appropriations bill is passed. Even then the CBO estimate for OCO spending is likely to remain artificially high, according to the AMA during a conference call earlier this week.

As stated in the AMA briefing, the OCO provides a unique and time-limited opportunity to resolve a problem that has been a burden to patients, physicians and to Congress. Passing up this opportunity means that Congress will have an even more costly problem to resolve in future years, requiring even more difficult choices.

The NCMS urges physicians to contact their Representatives and Senators and tell them you want Congress to repeal the SGR and develop a permanent fix for the broken system.

Click here to obtain contact information for members of the NC Congressional Delegation.

Physicians—We Need to Hear from You about the SGR Medicare Physician Rate Cuts

With the 29.5-percent Sustainable Growth Rate cut set for January 1, 2012, and the ongoing problems with the Medicare fee schedule, physicians report that they are considering different actions to address the issue.

Please follow the link below to take a quick survey that will help the NCMS better understand how the proposed cut will impact North Carolina physicians and their patients. The results of the survey will also allow the Society to meaningfully communicate with Congress and the media regarding these issues. As always, individual responses are confidential and only aggregate results will be reported.

Click here to take the survey.

Congressional leaders from both parties have publicly stated that they are committed to take action before the end of year to avert the scheduled 27 percent cut in Medicare physician payments. However, it’s not clear what action Congress might take as it returns from a Thanksgiving recess. The AMA reports that options for relief from the sustainable growth rate (SGR) range from short-term patches of a year or two to longer-term relief that provides for transition to a new Medicare physician payment system. A bid for a permanent repeal of the SGR was derailed when the Joint Select Committee on Deficit Reduction announced last month that it had failed to reach agreement on a deficit reduction proposal.

The NCMS urges physicians, to share their concerns with members of the North Carolina Congressional Delegation. Click here to find contact information for your Representatives and Senators and ask what steps they plan to take to end the ongoing SGR fiasco.

The NCMS, AMA, and other physician organizations are urging their members to contact every member of Congress and ask them to repeal the sustainable growth rate (SGR) formula used to set Medicare physician reimbursement rates. The Joint Select Committee on Deficit Reduction has been asked to include a repeal of the broken Medicare payment formula in its legislative proposal, which is due November 23, 2011.

AMA President Peter W. Carmel, MD, is calling on physicians around the country to take advantage of this opportunity and contact their Representatives and Senators to ask that they replace the SGR. Click here to read Dr. Carmel’s column, Breaking the Cycle: No better time than now to repeal Medicare’s broken payment formula.

The NCMS urges North Carolina physicians to contact their Senators and Representatives by phone, email or letter, or a personal visit, and ask them to repeal the SGR, which currently calls for a nearly 30 percent reduction in Medicare physician reimbursement rates effective January 1, 2012. Historically Congress has chosen to delay rate cuts instead of tackling the SGR issue, causing the potential cost to physicians to dramatically increase over time.

For contact information about NC Senators and Representatives, go to: http://www.contactingthecongress.org/cgi-bin/newseek.cgi?site=ctc2011&state=nc.

A multi-million dollar television and radio advertising campaign launched by the AMA on Friday, October 7, 2011, is urging physicians and their patients to tell members of Congress that now is the time to repeal Medicare’s flawed sustainable growth rate (SGR) formula. The campaign is scheduled to run two weeks and airs on national cable television (CNN and Fox), and on broadcast television (ABC, CBS, Fox, and NBC) in a select number of broadcast markets. A 60-second radio ad is also airing in select markets.

View the TV spot at: http://www.youtube.com/watch?v=IM0giJ1foOY.

Listen to the radio version at: http://www.ama-assn.org/resources/audio/washington/ama-sgr-radio-ad-07oct2011.mp3.

Medicare physician payments are scheduled to be slashed nearly 30 percent January 1, 2012. Results from an AMA poll released last week shows an overwhelming number of Americans, 94 percent, believe a 30 percent cut would be a serious problem for seniors.

The NCMS has been urging members of the North Carolina Congressional Delegation to repeal the SGR and develop a new method of determining Medicare reimbursements to physicians that more accurately reflects the actual cost of delivery of care.

By a vote of 15-2, the Medicare Payment Advisory Commission (MedPAC) voted Thursday to repeal the controversial sustainable growth rate (SGR) formula used to set Medicare physician reimbursement fees. MedPAC wants to replace the SGR with a plan that would reduce reimbursements by $335 billion over ten years.

The MedPac proposal includes cutting reimbursements to specialists by 5.9 percent for three years and then freezing those rates for seven years, and by freezing payments to primary care physicians throughout the same period. The plan calls for reducing payments to Medicare Part D drug plans by 32 percent, and post-acute care facilities by 21 percent, with a 14 percent reduction for Medicare beneficiaries.

The proposal has drawn criticism from physicians and hospitals. The two MedPAC members voting against the plan are physicians.

“The recommendations voted on today by MedPAC flies in the face of their previous recommendations to stop harmful physician cuts that threaten access to care for patients,” AMA President Peter W. Carmel, MD, said in response to the MedPAC action.

On Monday a number of national specialty societies and the AMA asked the Commission to reconsider its proposal to revise the Sustainable Growth Rate (SGR) used to determine Medicare physician reimbursement rates.

In a letter to MedPAC Chair Glenn M. Hackbarth, JD, MA, the physician organizations stated that they cannot support the proposed plan in its present form “because it retains many of the SGR’s flaws, undermines physicians’ ability to participate in payment and delivery reforms, and calls for payment rates that the Commission itself has previously said could reduce Medicare beneficiaries’ access to medical care.”

Several concerns and recommendations were included in the letter:

• MedPAC should examine a broader set of proposals to pay for SGR repeal
• Other Medicare policies compound MedPAC’s recommended payment cuts
• Revenue projections in changing times are unreliable
• The proposal could intensify existing access threats
• Unintended consequences could raise cost of care and derail payment reforms

Click here to read the letter in its entirety.

MedPAC’s action comes as the NCMS and other physician organizataions push Congress to repeal the SGR and develop a plan to offset a scheduled 29.4 percent cut in physician reimbursements on January 1, 2012. The NCMS is collaborating with other state and national physician organizations and with the NC Congressional Delegation to find a permanent solution to the SGR problem. For the past ten years Congress has chosen to delay cuts and not take further action. However, there are indications that Congress and the Obama administration may not intercede and delay cuts that go into effect in January. The NCMS will provide updates and alerts on further developments in the Bulletin and at www.ncmedsoc.org.

The NCMS is closely monitoring the activities of the Medicare Payment Advisory Commission (MedPAC), which has increased physician concerns over its proposal to eliminate the sustainable growth rate (SGR), used to determine physician Medicare reimbursement rates.

On Tuesday, MedPAC posted draft recommendations aimed at offsetting the budgetary costs of repealing the SGR. The Commission projects savings of $233 billion as part of a ten-year overhaul of the senior health care program.

The recommendations are divided into two tiers, with Tier I offering savings of $50 billion using proposals that have been recommended previously by the Commission. Tier II projects $180 billion in savings and contains proposals from outside groups such as Health and Human Services (HHS), Office of Inspector General (OIG), Congressional Budget Office (CBO) and MedPAC staff analysis. The Commission has not voted on or recommended the items on the Tier II list.

MedPAC unveiled its SGR proposal last week, calling for a freeze for primary care and a 5.9 percent cut for all of the other specialties for each of the next three years, followed by a seven-year freeze. The Commission is expected to take up the proposal at its October 6-7, 2011 meeting. (See Breaking News: MedPAC Addresses SGR Issue, Bulletin, 9-16-11). The NCMS is closely following these developments and will be providing updates in the Bulletin and at http://www.ncmedsoc.org.

Click here to read the MedPAC draft recommendations (PDF – 441 pages) to offset the budgetary costs of repealing the SGR.

The North Carolina Medical Society joined dozens of national and state physician organizations on Thursday in asking the Joint Select Committee on Deficit Reduction to include a repeal of the sustainable growth rate (SGR) formula in its final legislation. The call for a repeal came in a letter to members of the Committee as they held their first meeting.

In the letter, the organizations stressed that “…it is important to note that the current budget baseline assumes that massive physician payment cuts will be implemented, even though Congress has rejected less severe cuts 12 times over the past decade. This SGR deficit is being kept ‘off the books,’ which is inconsistent with accurate budget practices. In fact, Members of Congress from both sides of the aisle have stated that the current law baseline does not reflect the policies that Congress has operated by in recent years. Any effort to stabilize our nation’s finances must be based on a true assessment of future expenditures.”

The organizations estimate that the continued delay in replacing the SGR has escalated the cost of permanent payment reform, from $48 billion in 2005 to nearly $300 billion today. If additional short-term interventions are applied, they estimate the cost will double to about $600 billion by 2016.

“With a 30 percent across-the-board payment cut in physician services scheduled for January 1, 2012, the implications of continuing this practice of simply putting off cuts to future years are clear. Continued access to care for our nation’s senior and disabled citizens is seriously threatened.”

Click here to read the letter.

The Medicare Payment Advisory Commission (MedPAC) is considering a proposal to address the sustainable growth rate (SGR) used to determine physician Medicare reimbursement fees. At a meeting this morning, MedPAC discussed a possible repeal of the SGR using a broad range of budget offsets.

The proposal calls for a freeze for primary care and a 5.9 percent cut for all of the other specialties for each of the next three years, followed by a seven year freeze. The plan is currently under discussion by the Commission but will not be voted on until the October 6-7, 2011, meeting.

The NCMS is closely monitoring this latest development, as is the AMA, which says it will make it that much more difficult to convince Congress to adopt a plan being advocated by organized medicine.

“The misguided scheme discussed by MedPAC to replace the nearly 30 percent cut to physicians scheduled for January 1, 2012, with a new series of very significant cuts will harm patients and physicians in the Medicare program,” said AMA President Peter Carmel, MD. “The new cuts are inconsistent with MedPAC’s previous recommendations to stop cuts to physicians who care for Medicare patients because they threaten access to care for patients and would have severe consequences for the Medicare system.”

Dr. Carmel says Medicare payment updates since 2001 have not kept up with the cost of running a medical practice, leaving a 20 percent gap between reimbursement rates and practice expenses.  He notes that further drastic cuts could pose a risk to a physician’s ability to retain staff and make investments needed to modernize practices and improve quality while reducing costs in the Medicare system.

More details about the plan are expected to be released in the next few days, and the NCMS will provide updates in the Bulletin and at www.ncmedsoc.org. Share your thoughts below.

With the 29.5-percent Sustainable Growth Rate cut set for January 1, 2012, and the ongoing problems with the Medicare fee schedule, physicians report taking, planning, or considering different actions to approach the issue. Please follow the link below to take a quick survey that will help the North Carolina Medical Society better understand how the proposed cut will impact North Carolina patients. The results of the survey will also allow the Society to productively communicate with Congress and the media regarding these issues. As always, individual responses are confidential and only aggregate results will be reported.

Take the survey.

The NCMS this week commented on the proposed Medicare Physician Fee Schedule rule for calendar year 2012, as published in the Federal Register by the Centers for Medicare and Medicaid Services (CMS) on July 19, 2011. NCMS is particularly interested in how the rule will affect reimbursement to physicians and the ability of Medicare beneficiaries to access care.

In a letter to CMS Administrator Donald M. Berwick, MD, the NCMS:

• Supports permanent replacement of the SGR for updating the Medicare physician fee schedule. The NCMS is concerned about the potential impact of drastic cuts in Medicare physician reimbursement fees if Congress fails to replace the SGR and scheduled cuts are allowed take effect in 2012.
• Encourages the Secretary of the Department of Health and Human Services (HHS) to gain physician support and input in developing quality measures for all aspects of medical care for Medicaid patients. The NCMS believes that a rigid schedule of implementation of the value-based modifier for the Medicare Physician Fee Schedule is unrealistic and could lead to use of measures not supported by appropriate professional organizations and fail to provide reliable measures of value or quality.
• Shares the concerns of the AMA and national medical specialty societies over the proposed expansion of the Multiple Procedure Payment Reduction (MPPR) Policy to include advanced imaging services. The NCMS urges the CMS to refrain from subjecting entire groups of procedure and imaging codes to blanket rate reductions, and instead focus efforts on ensuring Medicare beneficiaries receive necessary diagnostic services at appropriate times.

Click here to the read the letter to Dr. Berwick.

NCMS will continue to address these issues in collaboration with the AMA and other physician organizations. Look for updates in the Bulletin and at http://www.ncmedsoc.org/.