Congressional leaders late Saturday night announced agreement on a Medicare prescription drug bill that includes payment relief for physicians, while another provision would place an 18-month moratorium on self-referrals to new specialty hospitals.
The 4.5% scheduled physician fee cut in 2004 would be blocked and replaced with a 1.5% update in 2004 and 2005.
The tentative accord also allows for bonus payments to physicians in scarcity areas in 2005, 2006 and 2007. Additionally, it brings the floor of the work geographic payment adjuster in the payment formula to 1.0 in 2004 through 2006, which means all doctors would be paid 100% of the national average.
The bill also includes an 18-month moratorium of the self-referral whole hospital exemption for new specialty hospitals, according to a summary of the agreement provided by the House Ways and Means Committee. "New hospitals" do not include existing facilities or those under construction effective the day the House files the bill.
During the moratorium, the Medicare Payment Advisory Council would analyze specialty hospital costs and whether the payment system should be changed. The secretary of HHS would study referral patterns and quality of care.
The Medicare conference committee has been working since July to create an agreement that combines in one $400 billion package two Medicare reform bills passed by the House and Senate in June. The deal is subject to final costs and review and sign-off on the details and language, says Sen. Max Baucus (D-Mont.), one of two Democrats allowed to participate in the conference negotiations.
"But I believe we have an agreement in principle today that can pass both houses," Baucus says in a written statement. "I urge my colleagues to keep an open mind as we work through the details of this tentative agreement."
The House and Senate are expected to vote on the conference report this week.
Other provisions in the agreement include:
- Indirect medial education (IME) payments to teaching hospitals of 6% for the last half of fiscal year 2004, 5.8% in 2005, 5.55% in 2006 and 5.35% in 2007.
- Payment for drugs administered in physician offices, now based on average wholesale price (AWP), in 2004 would be AWP minus 15%, with HHS having authority to increase or decrease reimbursement based on market surveys. Use of average sales price (ASP) plus an additional percentage would begin in 2005. In 2006, competitive bidding would become an option for physicians. Practice expense reimbursements for drug administration will increase based on surveys of practice expenses and examination of existing codes. MedPAC would be required to review by January 2005 how payment changes affect payments and access to oncologists, and by January 2006 for other specialists.
AMA President Donald Palmisano, M.D., says in a written statement that the bill ensures access to physicians and improves physician recruitment and retention in rural and underserved areas. The AMA has begun a "media blitz" supporting passage of the compromise by the House and Senate, with more than 10,000 physicians and patients using the AMA grassroots network to contact congressional representatives. The group also is running a new advertisement this week targeting Congress.
"Virtually every member of Congress has campaigned on passing a Medicare bill for seniors," says the ad, which will appear in CQ Today and Roll Call. "What will they tell voters if they don't?"