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Hot on the Hill: congressional health agenda

Will the second time be the charm for health care legislation that was stymied by partisan fighting last year?

By Joel B. Finkelstein, amednews staff. Feb. 3, 2003.

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The 108th Congress is expected to shock new life into a health care agenda that had gone into full arrest by the end of last year.

Republicans and Democrats seem to agree on the issues that need to be tackled this year. That should come as no surprise, since lawmakers debated virtually all of the topics in the 107th Congress but failed to pass legislation to address them.

But President Bush and Republican congressional leaders are promising progress this year. With control of both the House and Senate, Republicans may have more success bringing proposed health care legislation to the floor for a vote. Democrats held a narrow Senate majority last year, and partisan bickering in that chamber led to the demise of many bills favored by Bush and passed by the GOP-controlled House.

Before seeing any action on their priorities, however, the health care community likely must wait for Congress to pass the 11 fiscal-year 2003 appropriations bills, which at press time had not been voted on. Bush's proposed tax cut plan also could put health care initiatives in jeopardy in what promises to be a tight budget year.

Here is a summary of the issues on lawmakers' to-do list this year.

Medicare drug benefit

At the top of the list is a Medicare outpatient prescription drug benefit. Negotiations broke down last year over the cost and structure of such a benefit. Proposals ranged from $190 billion to $300 billion and offered varying levels of coverage or discounts depending on beneficiary income.

John Rother, who serves as policy director for the AARP, said that although seniors are willing to be flexible on the structure of prescription drug coverage, the Republican proposals did not provide enough money to get beneficiaries to sign up for the benefit.

It may prove disadvantageous to create a prescription drug benefit that is tacked onto Medicare, rather than one that is integrated into the program as part of comprehensive Medicare reform, he said.

Proposals for a stand-alone benefit are unlikely to be more generous this year due to the weak economy and Bush's desire to pass a tax-based stimulus package.

The administration likely would support proposals creating pharmacy benefit management programs, providing some form of government cost-sharing or expanding the Medicare+Choice program to enable more Medicare enrollees to join private health plans that already have drug coverage, said Bobby Jindal, assistant secretary of planning and evaluation at the Dept. of Health and Human Services.

Democrats are likely to reintroduce their more generous prescription drug benefit proposals from last year, but also would support PBMs, said Bridgett Taylor, a democratic staffer for the House Energy and Commerce Committee.

But Democrats are wary of proposals to privatize Medicare services because of what many people see as the failure of Medicare+Choice, which has seen an exodus of insurers.

Meanwhile, seniors don't expect relief from the high cost of prescription drugs any time soon, Rother said.

Even if last year's proposals had passed, they would not have gone into effect until 2005. If legislation succeeds this year, a benefit likely would not be available before 2006.

Medicare physician payment

Legislation to revise physician Medicare reimbursement was a near miss in the last Congress.

Late in December 2002, Centers for Medicare & Medicaid Services officials voiced regret in announcing a 4.4% cut to doctor reimbursement, which is scheduled to go into effect March 1. This gives Congress a window to change the reimbursement formula before the cuts become active.

New legislation, which would freeze payments at 2002 levels, was introduced last month, but it had not received a hearing as of press time.

The impending cut poses a threat of reduced access for seniors, said AMA Chair J. Edward Hill, MD. While the AMA is seeking a revision of the formula, freezing payment rates at current levels is an acceptable short-term solution. "That would give Congress time to go back and fix the formula," he said.

Surveys of physicians have shown that many expect to limit services to Medicare patients or stop serving them altogether due to the financial strain imposed by the payment cut. Other surveys have linked past cuts to reduced access to care for seniors and the uninsured.

Most doctors are ashamed to admit that they have had to limit their Medicare patients to 20% of their practice just to survive, said Sarah Walker, MD, president of the American College of Physicians--American Society of Internal Medicine. "We want to treat them all," Dr. Walker said.

Dr. Walker has talked to physicians across the country and found that many have had to take measures, often drastic ones, to stay in business. While some doctors have stopped accepting new Medicare patients, others have gone as far as to not take on new patients who are older than 60 in order to avoid treating them when they reach Medicare eligibility.

She is worried that decreased reimbursement will force more physicians to retire early, leaving "a big hole in the fabric of health care" in many areas.

In the Senate, there is pressure to pass more comprehensive Medicare payment reform.

Several lawmakers want to reassess regional variations in reimbursement and increase payments to other Medicare players, such as health plans. Senators from rural areas have complained that low payment under the current formula undermines the ability of physicians and hospitals in their states to provide quality care.

Senate Finance Committee Chair Chuck Grassley (R, Iowa) has vowed to block any Medicare payment updates that don't address these rural inequities.

"Anyone who wants something done on Medicare will have to deal with me on this issue, period," he said.

Democrats suggest that Republicans may have other reasons for holding up the payment revision.

"It's not surprising that we haven't fixed this yet," said Debbie Curtis, chief of staff for Rep. Fortney "Pete" Stark, (D, Calif.). Curtis argues that Republicans are holding up a revision as leverage to push through their prescription drug benefit proposal.

Tort reform

Continued physician protests over the medical liability insurance crisis promise to make it a prominent issue in Congress this year.

A growing number of states have been struggling with the waning availability of affordable medical liability insurance. Physician protests over the problem have escalated this year, and more doctors are giving up procedures that increase their risk of being sued.

Many states have passed tort reforms. But there is a growing awareness in Congress that this may not be an issue that states can tackle on their own, said Dean Rosen, Republican staff director for the Senate subcommittee on public health.

A bill that passed the House last year may serve as a basis for new plans, HHS' Jindal said. That measure would limit noneconomic damages to $250,000, give the court the power to supervise contingency fees and allow awards to be paid in installments.

"The current medical liability system is broken," said AMA President-elect Donald J. Palmisano, MD. Twelve states are experiencing crises in liability insurance, while many others are seeing dramatic rises in premiums, as well as physicians leaving and reducing services.

According to a recent HHS survey, average premiums rose nearly 20% for obstetrician-gynecologists last summer and more than 26% for internists. "The longer the Senate delays medical liability reform, the greater the risk to patients," Dr. Palmisano said.

The uninsured

At 41 million and counting, the uninsured received little more than lip service last year. Debate focused on tax credits, which many experts argue are not guaranteed to put a dent in the problem.

The Bush administration and congressional Republicans want a market-based approach, combining health insurance tax credits with medical savings accounts and purchasing pools for low-cost health insurance. Democrats don't oppose tax credits, Curtis said, but they need to be big enough to help the working poor.

Another portion of the Bush administration's effort to cut the number of uninsured is to bolster the community health care system.

Last year, Bush signed into law a bill to widen the health care safety net, with a goal of 1,200 new and expanded community medical centers by 2006. But it is up to Congress to fund this bill through the annual budget process.

But momentum might be building toward more comprehensive reform. The words "universal health care" still may carry a stigma from the Clinton plan's failure, but nearly 10 years later, politicians and insurance executives seem ready to talk about it again.

Driving the discussion is a growing belief that piecemeal reforms are not working and are not an efficient way to spend federal money.

Many policy experts suggest that the time is ripe for change, given Medicare and Medicaid funding problems, the crisis in medical liability insurance, a faltering public health infrastructure, and rising prescription drug expenditures.

Rosen and other congressional insiders say incremental reform may be pushed aside as merely a Band-Aid for a fundamentally flawed health care system. Lawmakers may find themselves faced with the task of rebuilding, rather than fixing, America's health care infrastructure.

But Republicans and Democrats still remain far apart in their views about how to best repair the system's problems.

Democrats lean toward a public program that covers everyone, either by expanding Medicare or Medicaid. Republicans will look to private-public partnerships that enable Americans to buy insurance plans of their choice.

Although it may fall short of universal health care, Republicans argue that Medicare and Medicaid are broken and that comprehensive reforms would allow the programs to work in concert with community hospitals and the health care safety net. This would save money, while covering more Americans.

But the question remains: What will happen to the Americans who rely on these public programs while a better system is being crafted?

Physicians already find themselves in the position of having to limit services to patients in public health programs to stay afloat. "There is great, great fear that this will affect access for seniors," Dr. Hill said.

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