Medical Device Daily Washington Editor

The healthcare cost containment paradigm is in full force, and the Medicare Payment Advisory Commission chimed in last week with a proposal that the Centers for Medicare & Medicaid Services shift the available money for Medicare Part B services away from specialty care to primary care. Specialty societies are less than enthused about what they see as a call for a three-year cut of 5.9% each year for specialists, and the push-back against the MedPAC proposal has begun in full force.

Whether CMS and Congress give the MedPAC proposal full consideration may depend on whether Congress thinks it has another fix for the Part B doctor fee dilemma, which was the subject of what seemed a handshake agreement between the American Medical Association (Washington) and Congress earlier this year to find a way to keep doctor fees no worse than flat for the next half decade while CMS works on a new rubric for Part B (Medical Device Daily, May 9, 2011). The problem with yet another overwrite of the sustainable growth rate (SGR) overhang is that it comes to more than $30 billion a year for roughly a decade, a difficult sum to swallow in a deficit situation as deep as that faced by the U.S. federal government.

The MedPAC report states that the commission had become concerned about the accuracy of time estimates used for fee schedules, saying that research done in this area “has shown that the time estimates are likely too high for some services,“ a notion backed by “anecdotal evidence and the experience of clinicians“ who are members of MedPAC. As for surveys conducted by medical specialty societies, the MedPAC document states that those societies “and their members have a financial stake“ in the relative values assigned to services, which the report describes as “an inherent conflict.“

MedPAC also asserted that it sees an imbalance in reimbursement for primary and specialty care, adding, “there is evidence that payment rates for some procedural services are too high relative to primary care“ and that consequently, those high prices create “an incentive for excessive volume growth.“

Brian Whitman, associate director of regulatory affairs for the American College of Cardiology (ACC; Washington) indicated that cardiologists find the report indigestible. “We find a lot of problems with the proposal,“ he said, noting that it is “inconsistent with anything they've recommended before“ regarding payment growth. “To be trying to pay for a budgetary gimmick“ in the form of SGR, Whitman said, “does not seem appropriate to use and we see it as likely to cause a lot of problems.“

“Cardiologists are in a tough spot“ when it comes to such proposals for Medicare reimbursement, Whitman argued, noting that “between one half and two thirds of their business is Medicare.“ He said that price pressures are making themselves felt already. “We've seen a lot of cardiologists move into hospital practice, and that may accelerate“ dramatically under the MedPAC proposal. He noted that this might be a good model for some doctors, “but we don't want it to be the only model.“

Whitman indicated that the MedPAC proposal is indicative of the commission's views regarding consolidation. “It's pretty clear from their recommendations . . . that they have an opinion that a larger and more consolidated group is a superior way of providing care. We're not sure that's the case,“ he said, adding that more money for primary care will not necessarily stitch together a more seamless continuum of care. “You're paying more for primary care even if they're not providing more quality care“ with this approach, he said, describing the proposal as “a pretty blunt way of dealing with the issues. We don't feel that paying the worst primary care in the country the same as the best primary care is going to solve that issue.“ Whitman also indicated that the accountable care model of healthcare delivery will not necessarily shift work from cardiologists to primary care doctors. “We were not anticipating any decrease in the amount of follow-up“ under the ACO paradigm, he said.

“I think it's a silly proposal that's not in context with where medical care is going,“ Whitman remarked, adding, “it just seems stuck in the past. It seems like a proposal they would have come up with five years ago.“

Alex Vladka, MD, of the Seton Brain and Spine Institute (Austin, Texas), spoke with Medical Device Daily on behalf of the American Association of Neurological Surgeons (AANS; Washington) and evinced little or no more appetite for the MedPAC proposal than Whitman. “Most of what caught our eye was their attempt to pit primary care doctors against specialty doctors,“ he remarked, adding that the problem lies with three infamous letters. “Really it's a flawed SGR formula“ that is at the bottom of the problem, he said, adding, “you need to fix SGR“ rather than “rob Peter to pay Paul.“

Vladka said that cuts of 5.9% per year for three years will drain incentives to practice neurological surgery, including spinal surgery, making the case that in some instances, reimbursement already does not match costs. He also said primary care doctors feed a lot of the expanded cost of spinal care. In many instances, he said, “all that patient probably needs is some exercise or physical therapy,“ but primary care doctors often “run right off to the MRI lab.“

Vladka said that cuts of about 20% are already en route according to AMA, and that “if you eventually knock it down by another 18%, physicians will have to make some decisions. You may see a lot more people evaluating and dropping out of Medicare altogether,“ he claimed.

Stating that the right evidence would guide care sufficiently to avoid waste, Vladka pointed out that while randomized, controlled trials are the gold standard, “the problem is there are not enough patients, money and time to subject every clinical question to a trial like that, so you're looking at more discussions of databases and registries. A lot of societies are moving that way and we're moving that way,“ he said, but added “we've been a little disappointed in how little it has been supported“ by government and other payers.

When asked whether an annual effort to recalibrate relative values, as proposed by MedPAC, might be more work than physician groups have time for, Vladka said, “that's a valid point,“ but he pointed out another hole in the idea. “Five years is perhaps a bit too long given the accelerating pace of change in delivery“ and devices, but “annually might be a bit much. How much data could you accumulate in 12 months?“ he asked.

In a statement e-mailed to MDD, Peter Mandell, MD, chair of the advocacy council at the American Association for Orthopedic Surgeons (AAOS; Chicago), said AAOS “believes MedPAC was shortsighted in its recommendation to cut physician reimbursements to fix“ SGR, adding that such cuts “are simply a quick fix to a more serious, deep rooted problem with our healthcare delivery system.“ Mandell added that AAOS “cannot support reckless Medicare cuts that will undoubtedly jeopardize patient care. Unless we modify our healthcare system to transform behavior and enhance efficiencies, we will never be effective in ensuring Medicare's sustainability in the long-term.“

The American College of Radiology (ACR; Washington) was no more a fan of the idea than the other societies. In a Sept. 16 statement, ACR said it is “strongly in favor of serious and properly designed proposals to eliminate“ SGR, but that it “strongly opposes the draft recommendations.“ Noting that the recommendation would result in a seven-year freeze after the three years of 5.9% cuts, ACR argued that MedPAC should “engage in a forthright and evidence-based dialogue with the entire physician community to arrive at an appropriate reimbursement policy“ that is “rooted in quality initiatives within a coordinated patient care structure.“ ACR also said that the cuts “would embody the antithesis of the accountable care philosophy, and would severely impair the multispecialty coordination of care so vital for the continued health and longevity of our country's Medicare patients.“

Mark McCarty, 703-268-5690