If hospital executives believe the balanced-budget deal recently reached between Congress and President Clinton is a raw deal for them, they should be happy they aren't surgeons.
The $115 billion in savings from Medicare over five years sought by Congress and the White House assumes HCFA will slice projected surgical fees by nearly 10% in 1998. Hospitals received more favorable treatment under the plan, making off with only a one-year freeze for inpatient payment rates.
But physicians fear hospitals have raised such a clamor over the potential of a revenue freeze that budget negotiators may resort to deeper cuts in surgical payments and reductions for other services to give hospitals a payment increase in the final spending legislation.
That may be particularly true because the budget agreement assumes healthy fee increases in 1998 for primary-care services and other nonsurgical procedures while it cuts surgery rates.
"The hospitals are getting a lot of attention to their concerns," said Robert Doherty, vice president for governmental affairs and public policy with the American Society of Internal Medicine. "The hospitals might raise such a stink that (Congress and Clinton) try to wring more out of physicians."
The 9.4% drop for surgical payments in 1998 would result from unifying the payment bases for Medicare physician fees. Medicare now uses three different bases to determine fees for surgery, primary care and other nonsurgical procedures.
To determine fees, the payment base-called the "conversion factor," and expressed as a dollar value-is multiplied by a numerical value based on the complexity of each service delivered to a Medicare beneficiary.
Physician-group representatives said Congress and the White House were trying to establish a single conversion factor for 1998.
Preliminary estimates put that single conversion factor at about $37.13 in 1998, compared with separate 1997 rates of $40.96 for surgery, $35.77 for primary care and $33.85 for other nonsurgical services.
The possibility of surgical fee cuts, however, may spur an effort to delay a change in Medicare reimbursement for physicians' practice expenses. The change, scheduled to begin in 1998, is expected to shift more money to primary-care doctors from surgeons and nonsurgical specialists.
If the surgical fee cut is included in the budget deal, surgeons may be able to argue more persuasively that the change in practice-expense compensation should be delayed because of the impact of the combined payment changes, said Wayne Powell, assistant director for federal reimbursement policy with the American Academy of Ophthalmology.