News in brief - March 17, 2003

Medicare participation deadline extended - Mental health parity makes a comeback - Government hearings explore competition in health care - House hears arguments on medical liability bill

Medicare participation deadline extended

Physicians will have until April 14 to decide whether they want to participate in Medicare this year, the Centers for Medicare & Medicaid Services said. The delay was announced in the rule formally implementing the 1.6% payment increase for 2003, which went into effect March 1. Services provided in January and February will be paid at the lower 2002 rate.

Claims for services provided in January and February but not processed until after March 1 will be paid at the higher 2003 rate, but then carriers will recoup the overpayment in July.

Physicians who change their Medicare participation status should contact their carriers to request a payment adjustment for claims for services provided in March or early April. Participating physicians are paid using a higher fee schedule and can bill beneficiaries only for the 20% co-payment. Nonparticipating physicians get paid less, but can charge beneficiaries more.

A question-and-answer document about the new rates and participation deadline is available on the CMS Web site (http://www.cms.gov/regulations/pfs).

Mental health parity makes a comeback

Lawmakers have reintroduced mental health parity legislation in Congress. The Senator Paul Wellstone Mental Health Equitable Treatment Act of 2003 would mandate that health insurers offering mental health benefits provide coverage for those services that is equal to that provided for other medical services. The measure is the same as the bill championed during previous congressional sessions by its namesake, the late Paul Wellstone.

"The time has come to end this blatant pattern of discrimination against people merely because they suffer from a mental illness," said Sen. Pete Domenici (R, N.M.), who introduced the original bill with Wellstone.

Mental health groups said the measure, which has bipartisan support in both the House and Senate, would close gaps left by the Mental Health Parity Act of 1996. That bill only prohibits unequal caps on annual and lifetime benefits, but allows plans to set higher co-pays or limit the number of treatment sessions.

"This legislation makes the promise of full parity for persons with mental illness a reality," said Paul S. Appelbaum, MD, president of the American Psychiatric Assn.

Government hearings explore competition in health care

A combined effort by the Dept. of Justice and Federal Trade Commission to examine the state of the health care marketplace and the roles of competition, antitrust enforcement and consumer protection kicked off in late February with a joint hearing. The two-day meeting included representatives from the Dept. of Health and Human Services and the academic, health professional, payer and employer communities.

"The federal antitrust agencies have placed physicians under a far higher level of scrutiny than is warranted by our comparative economic strength in today's health care system," Jacqueline M. Darrah, director of health law in the AMA Office of General Counsel told the Justice Dept. and FTC at the Feb. 27 hearing. "In recent years, physicians and physician organizations have been the subject of over 50 enforcement actions. ... By contrast, despite the increasing size and power of health plans and insurers, we are not aware of a single FTC action against a health insurance company, HMO, health plan or third-party payer. We are aware of only one [Dept. of Justice] action against a health insurer."

The Justice Dept. and the FTC plan to hold a series of monthly meetings between March and October. Hospital mergers, the significance of nonprofit status, and monopsony power are among the topics to be addressed.

More information can be found at the FTC Web site (http://www.ftc.gov/ogc/healthcarehearings).

House hears arguments on medical liability bill

More than a half-dozen witnesses -- including a physician, an insurer and a medical malpractice victim -- testified before the House Energy and Commerce Committee's health subcommittee in late February as part of a hearing, "Assessing the Need to Enact Medical Liability Reform."

The House is considering the Help Efficient, Accessible, Low-cost, Timely Healthcare Act of 2003, commonly known as the HEALTH Act. The bill would place a $250,000 cap on noneconomic damages, hold physicians responsible for only their portion of damages, impose a three-year statute of limitations on when most medical malpractice cases could be filed, and limit punitive damages to whichever is greater, two times the economic damages or $250,000.

The American Medical Association supports a limit on noneconomic damages because it believes a cap would help keep medical liability insurance premiums affordable. Trial lawyers and some patient advocacy groups say a cap would unfairly limit what injured patients could recover in medical malpractice cases.