| To all AOS members:
After meeting with the congressional leaders these appear
to be potential solutions or at least this is what is being
discussed in committee. They clearly told Dale and I all ideas
are on the table not just the ones listed below.
Option 1: freeze physician payment rates at their 2009 levels
through 2019, essentially disregarding the SGR mechanism for
those years. Returning to the SGR mechanism after a 10-year
freeze?starting in 2020?would require payment rates to be
reduced by about 5 percent each year for well over a decade
thereafter. Cost: $100B/5 years and $318B /10.
Option 2: fully replace the SGR with annual updates based
on changes in the prices of inputs that are used to provide
physicians’ services, minus a productivity adjustment
(as measured by the MEI). Instead of declining by 21% in 2010
and 5% annually for at least several years thereafter, payment
rates would rise by about 2% annually. Those updates wouldn’t
be subject to further adjustments, and excess spending, as
defined by the SGR, wouldn’t be recouped through subsequent
reductions in payment rates. Cost: $130B/5 and $439B/10
Option 3: expands on option 2 by including a hold-harmless
provision for premiums. Under this option, Medicare’s
Part B premiums would not be adjusted to reflect changes in
spending that resulted from changes in physicians’ payment
rates following the repeal of the SGR formula. Because that
hold harmless provision would uncouple premiums from program
costs, this option would add cost to Option 2. Cost: $164B/5
and $556B/10
I think that the bottom line is that congress is trying to
grapple with digging us out of the SGR hole we're in (which
clearly is an expensive proposition), while at the same time
making other systemic changes in the way Medicare pays for
care so that there is more focus on primary care, coordinated
care across settings, and better quality and value, rather
than sticking with the current system of reimbursing more
money for more volume regardless of outcomes and quality.
Getting there may cause some growing pains, many stakeholders
who have come to the table on health care reform agree that
we cannot deal with the access issues (coverage for all Americans)
without making fundamental changes to our delivery system.
Congress wants to be careful to do that in a way that makes
sense and doesn't have any unintended harmful side-effects,
and that is why it is so critical that we hear from everyone
throughout this process. Even after major health reform legislation
is passed (fingers crossed!), they will probably still have
to go back in and make adjustments over time to ensure it
is doing what it is intended to do, which is to improve access,
lower the rate of cost growth, and improve quality in our
health care system.
This a critical time in health care. Please pay attention
to these issues. Contact your congressional leaders and inform
them about your concerns.
The communications committee is working hard to implement
an easy way to send communications to congress. I will let
you know as soon as I can about this.
Sincerely,
Jim McKenzie, BOC member for Arkansas
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