October 1, 2009. The ability of Americans to choose to use their own money to obtain insurance policies less likely to ration in the exchanges to be set up by the health restructuring bill may be in danger. Originally, state-based "exchanges" were designed to allow comparison shopping among all insurance plans that provided the basic benefits. Now, however, a proposal is afoot to authorize states to limit the value of the insurance policies all Americans using the exchanges may purchase, by allowing them to exclude policies government authorities believe "do not offer good value and cost-effectiveness." This would effectively allow the imposition of price controls, limiting consumers’ access to adequate and unrationed health care. People would be limited in their ability to use their own money to save their own lives.
As the Senate Finance Committee consideration of amendments to its health care restructuring bill drew to a close this evening, Senators Jay Rockefeller (D-WV) and Kent Conrad (D-ND) got a commitment from Chairman Max Baucus (D-MT) to attempt to add such a to the bill, as it is melded with the version reported from the Senate Health, Education, Labor and Pensions Committee in July before the product goes to the Senate floor to a vote.
In a similar vein, Senator Maria Cantwell's (D-WA) amendment narrowly passsed earlier in the day. Agreed to by a vote of 12 -11 (with Sen. Blanche Lincoln (D-AR) joining Republicans), Sen. Cantwell's amendment allows states to establish insurance plans and negotiate rates for people earning between 133 to 200 percent of the federal poverty level- removing them from the exchange.
Sen. Cantwell claimed that 75 percent of the uninsured fall into that range. However, the concern is that "government negotiation" is not really negotiation, but in practice, has been shown to be price control. When there is only one buyer, they can set a price much lower than in a competitive market. Many of the details of the Cantwell Amendment are unclear, but it is one example of how people's access to unrationed care will be limited under this bill.
Showing posts with label Baucus. Show all posts
Showing posts with label Baucus. Show all posts
Thursday, October 1, 2009
MEDICARE DOCTORS, PATIENTS AFFECTED BY HEALTH BILL PROVISION PENALIZING 1 IN 10 DOCTORS ANNUALLY
[Revised October 23, 2009]
Under the Senate Finance Committee health care restructuring bill, doctors who authorize treatments for their Medicare patients that wind up in the top 10% of per capita cost for a year will lose 5% of their total Medicare reimbursements for that year.[1] In the game of musical chairs, there is always one chair less than the number of players – so no matter how fast the contestants run, someone will always be the loser when the music stops. Similarly, under the penalty provision, a moving target is created – by definition, there will ALWAYS be a top 10%, no matter how far down the total amount of money spent on Medicare is driven.
As one editorial puts it:
In a September 21, 2009 letter to Chairman Max Baucus (D-MT), the American Medical Association attacked its wisdom, noting, "Private and state insurance programs have experienced serious problems with the accuracy and validity of episode grouper methodologies to ‘profile’ physicians."
Civil libertarian columnist Nat Hentoff has written,
NOTES:
[1] The provision is (from language available at the Senate Finance Committee website) in "SEC. 3003. IMPROVEMENTS TO THE PHYSICIAN FEEDBACK PROGRAM." Beginning on page 683, the bill reads:
While these adjustments may reduce the degree to which physicians are disproportionately penalized if they have sicker patients or work in high-cost areas, they do not change the fundamental danger of this provision, which (as explained above) is to create continual pressure on doctors to make ever-increasing reductions in the treatments and tests they order for their
patients so as to avoid being in the penalized top 10%. The Congressional Budget Office rates this as taking almost $1 billion from Medicare payments over a period of 6 years. See CBO 10/07/09 letter to Chairman Baucus, Table, page 3 of 9.
[2] Washington Times, September 25.
[3] Nat Hentoff column.
Under the Senate Finance Committee health care restructuring bill, doctors who authorize treatments for their Medicare patients that wind up in the top 10% of per capita cost for a year will lose 5% of their total Medicare reimbursements for that year.[1] In the game of musical chairs, there is always one chair less than the number of players – so no matter how fast the contestants run, someone will always be the loser when the music stops. Similarly, under the penalty provision, a moving target is created – by definition, there will ALWAYS be a top 10%, no matter how far down the total amount of money spent on Medicare is driven.
As one editorial puts it:
In committee debate, Senator Kent Conrad (D-ND) said,Forget results. This provision makes no account for the results of care, its quality or even its efficiency. It just says that if a doctor authorizes expensive care, no matter how successfully, the government will punish him by scrimping on what already is a low reimbursement rate for treating Medicare patients. The incentive, therefore, is for the doctor always to provide less care for his patients for fear of having his payments docked. And because no doctor will know who falls in the top 10 percent until year's end, or what total average costs will break the 10 percent threshold, the pressure will be intense to withhold care, and withhold care again, and then withhold it some more. Or at least to prescribe cheaper care, no matter how much less effective, in order to avoid the penalties.[2]
"As I try to put my feet in the shoes of a doctor, I don’t know how you separate out overutilization that is really overutilization. There is no way of knowing when you go through the year, what you are going to do at the end of the year."He expressed concern there could be unintended consequences, adding that the penalty “leaves me cold.”
In a September 21, 2009 letter to Chairman Max Baucus (D-MT), the American Medical Association attacked its wisdom, noting, "Private and state insurance programs have experienced serious problems with the accuracy and validity of episode grouper methodologies to ‘profile’ physicians."
Civil libertarian columnist Nat Hentoff has written,
"Medicare doctors will not be the only losers. As the doctors struggle to keep abreast of the continually falling limit of the money they can authorize for their contingent of patients, consider what those patients will lose in the quality of their treatment."[3]Senator Jon Kyl (R-Az) is expected to offer an amendment after the bill comes to the Senate floor (presently expected during November 2009) to strike the penalty provision, similar to one he unsuccessfully offered in the Senate Finance Committee, which was endorsed by the Alliance of Specialty Medicine. The Alliance is a coalition of 11 national medical specialty societies representing more than 200,000 physicians.
NOTES:
[1] The provision is (from language available at the Senate Finance Committee website) in "SEC. 3003. IMPROVEMENTS TO THE PHYSICIAN FEEDBACK PROGRAM." Beginning on page 683, the bill reads:
“(b) INCENTIVES FOR AVOIDING EXCESS UTILIZATION.—Section 1848(a) of the Social Security Act (42 U.S.C. 1395w–4(a)), as amended by section 3002(b), is
amended by adding at the end the following new paragraph:
9) INCENTIVE FOR AVOIDING EXCESS UTILZATION.—
(A) IN GENERAL.—With respect to physicians’ services furnished by an applicable physician on or after January 1, 2014, the fee schedule amount for such services furnished by the applicable physician during the year (including the fee schedule amount for purposes of determining a payment based on such amount) shall be 95 percent of the fee schedule amount that would otherwise apply to such services under this subsection (determined after application of paragraphs (3), (5), (7),
and (8), but without regard to this paragraph).
(B) APPLICABLE PHYSICIAN.—In this paragraph: (i) IN GENERAL.—The term ‘applicable physician’ means a physician which the Secretary determines is at or above the 90th percentile of resource use (or, if applicable, the standard measure
of utilization specified under subparagraph (C))with respect to a composite measure per individual, such as the composite measure under the methodology established under subsection (n)(9)(C)(iii).
While these adjustments may reduce the degree to which physicians are disproportionately penalized if they have sicker patients or work in high-cost areas, they do not change the fundamental danger of this provision, which (as explained above) is to create continual pressure on doctors to make ever-increasing reductions in the treatments and tests they order for their
patients so as to avoid being in the penalized top 10%. The Congressional Budget Office rates this as taking almost $1 billion from Medicare payments over a period of 6 years. See CBO 10/07/09 letter to Chairman Baucus, Table, page 3 of 9.
[2] Washington Times, September 25.
[3] Nat Hentoff column.
Wednesday, September 30, 2009
SENATE FINANCE COMMITTEE AFFIRMS DEATH SPIRAL IN PARTY LINE VOTE; CONRAD SUGGESTS HE MAY VOTE AGAINST IT ON FLOOR WITH DIFFERENT OFFSET
September 30. An amendment proposed by Senator Jon Kyl (R-AZ) to get rid of a 5% penalty for Medicare doctors who order treatments and tests for their patients that wind up in the 10% most expensive per patient over a year was defeated 13-10 in the Senate Finance Committee this evening, with all committee Republicans voting to end the penalty and all committee Democrats voting to keep it.
Before the vote, however, Senator Kent Conrad (D-ND), said, "We’d be well advised ... to drop the penalty. I want to commit to working with Senator Kyl to find [another] offset before we go to the floor." This was in line with Conrad’s remarks on September 29 when Senator Kyl first brought up the amendment and temporarily withdrew it in order try to work out an alternative way of paying for the elimination of the penalty, which is scored by the Congressional Budget Office as cutting Medicare payments by $1 billion over ten years. The senators and their staffs were unable to agree on such an alternative during the intervening 24 hours, but, as Senator Conrad’s remarks indicate, will continue to try to agree on one so as to be able to support a jointly acceptable amendment by the time the measure goes before the full Senate for a vote.
Of course, even if Senators Conrad and Kyl agree, that is no guarantee that an amendment they both support will in fact be adopted when offered on the Senate floor. "Those concerned with the grave danger that Medicare doctors will be induced to ration more and more each year by this ‘musical chair’ penalty need to redouble their efforts to convince their Senators in the short weeks before the Senate votes on health care restructuring," said Burke J. Balch, director of National Right to Life’s Powell Center for Medical Ethics.
Before the vote, however, Senator Kent Conrad (D-ND), said, "We’d be well advised ... to drop the penalty. I want to commit to working with Senator Kyl to find [another] offset before we go to the floor." This was in line with Conrad’s remarks on September 29 when Senator Kyl first brought up the amendment and temporarily withdrew it in order try to work out an alternative way of paying for the elimination of the penalty, which is scored by the Congressional Budget Office as cutting Medicare payments by $1 billion over ten years. The senators and their staffs were unable to agree on such an alternative during the intervening 24 hours, but, as Senator Conrad’s remarks indicate, will continue to try to agree on one so as to be able to support a jointly acceptable amendment by the time the measure goes before the full Senate for a vote.
Of course, even if Senators Conrad and Kyl agree, that is no guarantee that an amendment they both support will in fact be adopted when offered on the Senate floor. "Those concerned with the grave danger that Medicare doctors will be induced to ration more and more each year by this ‘musical chair’ penalty need to redouble their efforts to convince their Senators in the short weeks before the Senate votes on health care restructuring," said Burke J. Balch, director of National Right to Life’s Powell Center for Medical Ethics.
Tuesday, September 29, 2009
“DEATH SPIRAL” IN TROUBLE? NEGOTIATIONS BEHIND THE SCENES CONTEMPLATED
September 29. This evening in the Senate Finance Committee, Senator Jon Kyl (R-AZ) offered his amendment to strike from the health care restructuring bill a provision imposing a 5 % penalty on one in ten Medicare physicians yearly, those whose costs per senior citizen wind up in the top 10%. However, he agreed temporarily to withdraw it at the request of Senator Kent Conrad (D - ND), who spoke out strongly against the penalty provision but sought modifications in the offset originally proposed by Senator Kyl. The temporary withdrawal raises the prospect that an agreed method might be worked out to strike the penalty provision.
The National Right to Life Committee strongly supports the Kyl Amendment and opposes the penalty provision. Senator Kyl quoted Executive Director David N. O'Steen, Ph.D., "This provision creates a cruel death spiral. By financially penalizing Medicare providers, the Baucus bill sets up the cruelest and most effective way to ensure that doctors are forced to ration care for their senior citizen patients. Instead of bureaucrats directly specifying the treatment denials that will mean death and poorer health care for older people, it compels individual doctors to do the dirty work."
Under the bill as it stands, any physician treating Medicare patients who ordered treatments and tests whose cost turned out to be in the highest ten percent per capita would have to pay back to the federal government five percent of all the Medicare reimbursements the physician had received for that year. Senator Kyl warned this would force a "race to the bottom." He said, "If we’re focused on evidence-based criteria, how can we in good conscience simply take an arbitrary number? Ten percent will take a hit regardless of results." He warned that it would create a "conflict of interest" for doctors who would be deterred from ordering what is in the best interests of their patients for fear that they might end up among the 10% of doctors who would face a hefty financial penalty each year. Kyl noted that the Alliance of Specialty Medicine, a coalition of 11 medical organizations representing 200,000 doctors, has endorsed his amendment.
Senator Conrad remarked, "As I try to think about putting … my feet in the shoes, of a doctor who might be treating Medicare patients facing this construct, it is one thing to have the feedback, I think we should absolutely… I think we should do that. But I think this putting in a penalty, that really leaves me cold. I don’t know how you separate out overutilization that is really overutilization from those doctors who may have a group of patients who require more treatment than another group of patients and when you’re put in the position of, there is no way of knowing as you go through the year what is going to happen at the end of the year. And so what do any doctor who wants to avoid being in this penalty box have to do? …I think this is one part of this that I think we should think long and hard about. There is no way of knowing when you go through the year, what you are going to do at the end of the year. . . . I think this is something we would get down the road and we’d regret."
Committee Chairman Senator Max Baucus (D-MT), although he emphasized what he saw as the need to reduce "overutilization," said, "Maybe Senator Kyl has a point here" and offered to "see what modification we can make to address his concern."
Under the rules regulating amendments in the committee, any amendment that strikes a provision "scored" by the Congressional Budget Office (CBO) as cutting costs must include a measure that cuts the same amount in some other way. The CBO scored the penalty provision as cutting Medicare by $ 1 billion over ten years, and as proffered Senator Kyl’s amendment offset that by taking a corresponding amount from funding for the cooperative plans designed by Senator Conrad, and included in the bill proposed by Chairman Baucus, as a replacement for the much-debated "public plan."
Whether the Kyl Amendment to strike the "death spiral" provision, with a different offset, will be brought back with broad support, or whether it will face a closely divided vote, the next day or so is likely to show. Chairman Baucus has expressed his hope that the Senate Finance Committee will complete its consideration of amendments and take a final vote on approving the bill as amended by the end of the week.
The National Right to Life Committee strongly supports the Kyl Amendment and opposes the penalty provision. Senator Kyl quoted Executive Director David N. O'Steen, Ph.D., "This provision creates a cruel death spiral. By financially penalizing Medicare providers, the Baucus bill sets up the cruelest and most effective way to ensure that doctors are forced to ration care for their senior citizen patients. Instead of bureaucrats directly specifying the treatment denials that will mean death and poorer health care for older people, it compels individual doctors to do the dirty work."
Under the bill as it stands, any physician treating Medicare patients who ordered treatments and tests whose cost turned out to be in the highest ten percent per capita would have to pay back to the federal government five percent of all the Medicare reimbursements the physician had received for that year. Senator Kyl warned this would force a "race to the bottom." He said, "If we’re focused on evidence-based criteria, how can we in good conscience simply take an arbitrary number? Ten percent will take a hit regardless of results." He warned that it would create a "conflict of interest" for doctors who would be deterred from ordering what is in the best interests of their patients for fear that they might end up among the 10% of doctors who would face a hefty financial penalty each year. Kyl noted that the Alliance of Specialty Medicine, a coalition of 11 medical organizations representing 200,000 doctors, has endorsed his amendment.
Senator Conrad remarked, "As I try to think about putting … my feet in the shoes, of a doctor who might be treating Medicare patients facing this construct, it is one thing to have the feedback, I think we should absolutely… I think we should do that. But I think this putting in a penalty, that really leaves me cold. I don’t know how you separate out overutilization that is really overutilization from those doctors who may have a group of patients who require more treatment than another group of patients and when you’re put in the position of, there is no way of knowing as you go through the year what is going to happen at the end of the year. And so what do any doctor who wants to avoid being in this penalty box have to do? …I think this is one part of this that I think we should think long and hard about. There is no way of knowing when you go through the year, what you are going to do at the end of the year. . . . I think this is something we would get down the road and we’d regret."
Committee Chairman Senator Max Baucus (D-MT), although he emphasized what he saw as the need to reduce "overutilization," said, "Maybe Senator Kyl has a point here" and offered to "see what modification we can make to address his concern."
Under the rules regulating amendments in the committee, any amendment that strikes a provision "scored" by the Congressional Budget Office (CBO) as cutting costs must include a measure that cuts the same amount in some other way. The CBO scored the penalty provision as cutting Medicare by $ 1 billion over ten years, and as proffered Senator Kyl’s amendment offset that by taking a corresponding amount from funding for the cooperative plans designed by Senator Conrad, and included in the bill proposed by Chairman Baucus, as a replacement for the much-debated "public plan."
Whether the Kyl Amendment to strike the "death spiral" provision, with a different offset, will be brought back with broad support, or whether it will face a closely divided vote, the next day or so is likely to show. Chairman Baucus has expressed his hope that the Senate Finance Committee will complete its consideration of amendments and take a final vote on approving the bill as amended by the end of the week.
Wednesday, September 23, 2009
ROBBING PETER TO PAY PAUL – FUNDING THE SENATE FINANCE BILL BY CUTTING HEALTH CARE FUNDING FOR OLDER AMERICANS
[Updated October 8, 2009]
The $829 billion (over ten years) bill for expanding health insurance coverage under the Senate Finance Committee bill as it now stands would be funded (roughly) 50% by cuts in Medicare and also 24% by a 40% tax on health insurance premiums over certain thresholds.
Thus, over half of the cost of covering the uninsured would come from “robbing Peter to pay Paul.” Older Americans, in particular, would be targeted, facing Medicare cuts of over $410 billion over the ten years from 2010 through 2019.
The one source of funding that would keep pace with the rising resources devoted to health care would be the 40% levy on health insurance premiums. Initially, this would apply (with some exceptions) to insurance plans that cost over $8000 annually for an individual or $21,000 annually for a family. These threshold amounts would increase each year by the average rate of inflation plus one percent. Since what is spent on health care consistently rises substantially more each year than the average inflation rate, the effect would be that, over time, larger and larger proportions of those with health insurance would begin to pay the tax on gradually rising portions of their premiums. [Compare NRLC's plan to extend healthcare without rationing here and an explanatory webinar here.]
DETAILS AND DOCUMENTATION
It is important to understand that the precise figures are in a state of flux, as the bill has not yet been converted to legislative language.[1] The objective here is solely to give a “big picture” rough analysis.
The total cost of expanding coverage (the subsidies for the uninsured, outlays for Medicaid and the Children’s Health Insurance Program and credits for small business) was estimated by the Congressional Budget Office at $829 billion.[2]
The total cuts to Medicare are over $410 billion dollars. [3]
The 40% excise tax on health care plans with annual premiums of more than $8000 for an individual or $21,000 for a family (with this threshold rising annually at the average rate of general inflation plus 1%), and with exceptions for over-55 retirees and those in certain high-risk professions is estimated to produce $201 billion over 10 years. [4]
NOTES
[1] The Senate Finance Bill as amended is available here.
[2] Based on tables entitled “Preliminary Estimate for Title I, Subtitle F Through Title V of the Chairman's Mark as Amended...” attached to Letter of Congressional Budget Office Director Douglas Elmendorf to Chairman Max Baucus of October 7, 2009, available here. The figure of $829 billion is derived from adding back in the offsets in that table for penalty payments and the excise tax on high premium insurance plans.
[3] Letter, from Doug Elmendorf and CBO to Chairman Max Baucus of October 7, 2009, available here. For a breakdown of Medicare spending see here.
[4] Joint Committee on Taxation, “Estimated Revenue Effects of the Revenue Provisions Contained in Title Vi Of Fiscal Years 2010 – 2019 as Amended Through October 2, 2009, And Under Consideration By The Committee On Finance" available here.
The $829 billion (over ten years) bill for expanding health insurance coverage under the Senate Finance Committee bill as it now stands would be funded (roughly) 50% by cuts in Medicare and also 24% by a 40% tax on health insurance premiums over certain thresholds.
Thus, over half of the cost of covering the uninsured would come from “robbing Peter to pay Paul.” Older Americans, in particular, would be targeted, facing Medicare cuts of over $410 billion over the ten years from 2010 through 2019.
The one source of funding that would keep pace with the rising resources devoted to health care would be the 40% levy on health insurance premiums. Initially, this would apply (with some exceptions) to insurance plans that cost over $8000 annually for an individual or $21,000 annually for a family. These threshold amounts would increase each year by the average rate of inflation plus one percent. Since what is spent on health care consistently rises substantially more each year than the average inflation rate, the effect would be that, over time, larger and larger proportions of those with health insurance would begin to pay the tax on gradually rising portions of their premiums. [Compare NRLC's plan to extend healthcare without rationing here and an explanatory webinar here.]
DETAILS AND DOCUMENTATION
It is important to understand that the precise figures are in a state of flux, as the bill has not yet been converted to legislative language.[1] The objective here is solely to give a “big picture” rough analysis.
The total cost of expanding coverage (the subsidies for the uninsured, outlays for Medicaid and the Children’s Health Insurance Program and credits for small business) was estimated by the Congressional Budget Office at $829 billion.[2]
The total cuts to Medicare are over $410 billion dollars. [3]
The 40% excise tax on health care plans with annual premiums of more than $8000 for an individual or $21,000 for a family (with this threshold rising annually at the average rate of general inflation plus 1%), and with exceptions for over-55 retirees and those in certain high-risk professions is estimated to produce $201 billion over 10 years. [4]
NOTES
[1] The Senate Finance Bill as amended is available here.
[2] Based on tables entitled “Preliminary Estimate for Title I, Subtitle F Through Title V of the Chairman's Mark as Amended...” attached to Letter of Congressional Budget Office Director Douglas Elmendorf to Chairman Max Baucus of October 7, 2009, available here. The figure of $829 billion is derived from adding back in the offsets in that table for penalty payments and the excise tax on high premium insurance plans.
[3] Letter, from Doug Elmendorf and CBO to Chairman Max Baucus of October 7, 2009, available here. For a breakdown of Medicare spending see here.
[4] Joint Committee on Taxation, “Estimated Revenue Effects of the Revenue Provisions Contained in Title Vi Of Fiscal Years 2010 – 2019 as Amended Through October 2, 2009, And Under Consideration By The Committee On Finance" available here.
Thursday, September 17, 2009
“DEATH SPIRAL” RATIONING IN THE SENATE FINANCE BILL – DRIVING DOCTORS TO DENY CARE TO SENIOR CITIZENS
Senate Finance Committee Chairman Max Baucus’s “Mark,” released September 16 and due to be considered in committee beginning Tuesday, September 22, contains a provision penalizing doctors based on how much medical treatment they direct for senior citizens on Medicare. It establishes that for at least five years (2015-2020), Medicare physicians who authorize treatments for their patients that wind up in the top 10% of per capita cost for a year will lose 5% of their total Medicare reimbursements for that year.
This means that all doctors treating older people will constantly be driven to try to order the least expensive tests and treatments for fear that they will be caught in that top 10%. Note that this feature operates independently of any considerations of quality, efficiency, or waste – if you authorize enough treatment for your patients, however necessary and appropriate it may be, you are in danger of being one of the 1 in 10 doctors who will be penalized each year.
Moreover, the penalty for Medicare doctors creates a moving target – by definition, there will ALWAYS be a top 10%, no matter how far down the total amount of money spent on Medicare is driven. Say that in 2015 the top 10% is anything over $10,000 per patient. In 2016 most doctors will scramble to hold down the treatments they authorize to avoid breaking that limit – with the result that the total amount spent will drop, so that the top 10% might then be, say, anything over $9,500. As the process repeats, the next year it might be anything over $9,000, the year after that anything over $8,000, and so on.
It's like a game of musical chairs, in which there is always 1 chair less than the number of players -- so no matter how fast the contestants run, someone will always be the loser when the music stops.
The disincentive to provide treatment for senior citizens the penalty creates is determined purely by cost, without any assessment of balancing cost with benefit. It will create a constant sense of uncertainty in doctors, since none can know in advance precisely what the cutoff for a given year will be – resulting in ever-increasing pressure to limit treatment and diagnostic tests to the bare minimum.
The provision to which this blog entry refers is as follows ( from documents available at http://finance.senate.gov/sitepages/legislation.htm ).
On pages 80-81, in the "Expansion of Physician Feedback Program" in Title III, Subtitle A, Part I; specifically, at the top of page 81: "Beginning in 2015, payment would be reduced by five percent if an aggregation of the physician's resource use is at or above the 90th percentile of national utilization. After five years, the Secretary would have the authority to convert the 90th percentile threshold for payment reductions to a standard measure of utilization, such as deviations from the national mean."
On page 80, the Chairman's Mark states, "In preparing feedback reports, the Secretary would be required to make appropriate data adjustments to (1) account for differences in the demographic characteristics and health status of individuals so as not to penalize those physicians who tend to serve less healthy individual [sic] who may require more intensive interventions, and (2) eliminate the effect of geographic adjustments in payment rates."
While these adjustments may reduce the degree to which physicians are disproportionately penalized if they have sicker patients or work in high-cost areas, they do not change the fundamental danger of this provision, which (as explained above) is to create continual pressure on doctors to make ever-increasing reductions in the treatments and tests they order for their patients so as to avoid being in the penalized top 10%.
CBO rates this as taking $1 billion from Medicare payments over a period of 6 years. See CBO 9/16/09 letter to Chairman Baucus, Table, page 3 of 7.
This is the cruelest and most effective way to ensure that doctors are forced to ration care for their senior citizen patients. It takes the telltale fingerprints from the government: instead of bureaucrats directly specifying the treatment denials that will mean death and poorer health for older people, it compels individual doctors to do the dirty work. It is an outrageous way to "reform" health care – by taking it away from America’s senior citizens.National Right to Life Committee Executive Director David N. O’Steen, Ph.D.
Senate Finance Committee Chairman Max Baucus’s “Mark,” released September 16 and due to be considered in committee beginning Tuesday, September 22, contains a provision penalizing doctors based on how much medical treatment they direct for senior citizens on Medicare. It establishes that for at least five years (2015-2020), Medicare physicians who authorize treatments for their patients that wind up in the top 10% of per capita cost for a year will lose 5% of their total Medicare reimbursements for that year.
This means that all doctors treating older people will constantly be driven to try to order the least expensive tests and treatments for fear that they will be caught in that top 10%. Note that this feature operates independently of any considerations of quality, efficiency, or waste – if you authorize enough treatment for your patients, however necessary and appropriate it may be, you are in danger of being one of the 1 in 10 doctors who will be penalized each year.
Moreover, the penalty for Medicare doctors creates a moving target – by definition, there will ALWAYS be a top 10%, no matter how far down the total amount of money spent on Medicare is driven. Say that in 2015 the top 10% is anything over $10,000 per patient. In 2016 most doctors will scramble to hold down the treatments they authorize to avoid breaking that limit – with the result that the total amount spent will drop, so that the top 10% might then be, say, anything over $9,500. As the process repeats, the next year it might be anything over $9,000, the year after that anything over $8,000, and so on.
It's like a game of musical chairs, in which there is always 1 chair less than the number of players -- so no matter how fast the contestants run, someone will always be the loser when the music stops.
The disincentive to provide treatment for senior citizens the penalty creates is determined purely by cost, without any assessment of balancing cost with benefit. It will create a constant sense of uncertainty in doctors, since none can know in advance precisely what the cutoff for a given year will be – resulting in ever-increasing pressure to limit treatment and diagnostic tests to the bare minimum.
The provision to which this blog entry refers is as follows ( from documents available at http://finance.senate.gov/sitepages/legislation.htm ).
On pages 80-81, in the "Expansion of Physician Feedback Program" in Title III, Subtitle A, Part I; specifically, at the top of page 81: "Beginning in 2015, payment would be reduced by five percent if an aggregation of the physician's resource use is at or above the 90th percentile of national utilization. After five years, the Secretary would have the authority to convert the 90th percentile threshold for payment reductions to a standard measure of utilization, such as deviations from the national mean."
On page 80, the Chairman's Mark states, "In preparing feedback reports, the Secretary would be required to make appropriate data adjustments to (1) account for differences in the demographic characteristics and health status of individuals so as not to penalize those physicians who tend to serve less healthy individual [sic] who may require more intensive interventions, and (2) eliminate the effect of geographic adjustments in payment rates."
While these adjustments may reduce the degree to which physicians are disproportionately penalized if they have sicker patients or work in high-cost areas, they do not change the fundamental danger of this provision, which (as explained above) is to create continual pressure on doctors to make ever-increasing reductions in the treatments and tests they order for their patients so as to avoid being in the penalized top 10%.
CBO rates this as taking $1 billion from Medicare payments over a period of 6 years. See CBO 9/16/09 letter to Chairman Baucus, Table, page 3 of 7.
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