Attempts to persuade the Bush administration to increase Medicare physician payments through a retroactive change to federal cost estimates hit a roadblock last week, but physician groups still have other avenues to pursue.
House Republican leaders and American Medical Association-led physician groups took steps last week to get the Centers for Medicare and Medicaid Services to change physician payment cost estimates from 1998 and 1999, figures they say triggered a series of successive payment cuts.
Under current law, physician payments will decrease 5.4% this year and will drop another 5.7% next year.
Faced with a presidential order to offset any Medicare payment increases for one provider group with cuts to others, House Republicans tried to use the proposed retroactive change as a way to free up funds as they complete a Medicare proposal that has gotten bogged down in a reimbursement tug of war between hospitals and physicians (See related story below).
But the administration would not budge from its position that it is legally prevented from going back to 1998-1999 to make the changes to the estimates, which CMS Administrator Thomas Scully publicly has said were wrong.
"We still don't have the authority to make these changes," a CMS spokesman said.
Washington insiders said both the administration and Congress want to help physician groups, but it all comes down to money. "People want to take credit for the service, but they don't want to sign the check," said Steve Jenning, a partner with the Washington-based Capitol Health Group, which represents physician specialty groups.
House Ways and Means Committee Chairman William Thomas (R-Calif.) met with little luck in March when he asked Scully to make payment clarifications. Thomas recently sought help from House Appropriations Committee Chairman Bill Young (R-Fla.), asking him to add language to the 2002 supplemental appropriations bill that would outright give HHS the authority to change the projections. The behind-closed-doors talks fell through last week, though, when a Congressional Budget Office projection showed it would cost $43 billion over 10 years, according to a Republican House staffer.
"If Ways and Means wants it, they should put it in their own bill," said an Appropriations Committee spokesman.
House Energy and Commerce Committee Chairman Billy Tauzin (R-La.) last week said he may add similar language to the antibioterrorism bill. But inclusion of the physician payment clarification is unlikely in any final plan now that it carries a $43 billion price tag, said the Republican House staffer.
Meanwhile, the AMA and 40 other medical groups last week released a report that found the CMS already has the legal authority to revise its 1998 and 1999 calculations under law.
Penned recently by former CMS (then HCFA) legal chief and Deputy Administrator Terry Coleman, who served under both President Reagan and the first President Bush, the report said the revisions would increase physician payments by $46 billion over 10 years. It also argued that the CMS should remove outpatient drugs from the physician spending pool to add an additional $16 billion over 10 years to physician payments.
"It is just absurd that we are punishing people with data that are bad," said Richard Deem, the AMA's vice president of government affairs. If revisions aren't made, physician calculations in 2005 will be less than they were in1993, he said. The AMA has sent the report to the White House but has not received a response.
Physicians have other ways to pursue increased payments. The Energy and Commerce Committee is considering several options, said another House Republican aide. One would give physicians short-term relief such as 2% payment increases for the next three years, but Congress would have to readdress the whole issue in 2006.
"It doesn't provide full relief, but it's a good way to start the discussion," Jenning said. But physicians may have to wait until fall when Congress approves an omnibus budget reconciliation package, he said.