News in brief - Jan. 19, 2004

Ephedra banned by FDA - CMS issues Medicare physician pay rule, extends participation deadline - Court ruling stops Calif. Medicaid cuts - Wash. physicians blast tort reform package - Senate takes aim at employer health benefits - Hospitals urged to help uninsured - Wis. governor signs patient compensation fund legislation

Ephedra banned by FDA

The Food and Drug Administration has decided to ban dietary supplements containing ephedra and will publish a final rule as soon as possible to formalize that decision, Dept. of Health and Human Services Secretary Tommy Thompson announced Dec. 30, 2003.

"Today's action puts companies on notice of our intentions, and it tells consumers that the time to stop using ephedra products is now," Thompson said.

The rule would ban the sale of dietary supplements containing ephedrine alkaloids when it becomes effective, 60 days after publication. The action is a first for the FDA regarding a dietary supplement.

The American Medical Association, which has long called for such a ban, praised the decision. "Dietary supplements containing ephedra are a serious health threat, and this ban will lead to the removal of these products from supermarket and drugstore shelves nationwide," said AMA Trustee Ron Davis, MD.

CMS issues Medicare physician pay rule, extends participation deadline

The Centers for Medicare & Medicaid Services in late December 2003 issued the regulation implementing the 1.5% physician payment increase, which went into effect Jan. 1.

Because of the late timing of the rate change, the agency has extended until Feb. 17 the deadline for doctors to decide whether they want to participate in Medicare this year.

Participating physicians are paid using a higher fee schedule but agree to bill beneficiaries only for the 20% co-payment. Nonparticipating physicians are paid using a lower fee schedule but can charge beneficiaries more.

Court ruling stops Calif. Medicaid cuts

California physicians weren't hit by a 5% Medi-Cal rate cut on Jan. 1 thanks to a preliminary injunction issued in late December 2003 by U.S. District Judge David Levi.

The state didn't consider how the payment cut -- which would total hundreds of millions of dollars -- would impact access to care for the people enrolled in California's Medicaid program, Levi said.

The ruling seems to thwart the additional 10% reduction proposed by Gov. Arnold Schwarzenegger's administration as well, said California Medical Assn. CEO Jack Lewin, MD. "The judge's decision will prevent further erosion of access to care for our most vulnerable patients," he said.

Attorneys for CMA and other plaintiffs are reviewing what the decision means for cuts already made in the Medi-Cal managed care plans. Levi ruled that those reductions, which touch about half of the estimated 6.5 million Medi-Cal recipients, would have to be addressed separately.

Wash. physicians blast tort reform package

Washington State Medical Assn. officials criticized the tort reform package proposed last month by the state's elected leaders as inadequate.

"Physicians are not interested in illusions that solve nothing and which please no one except personal injury attorneys who richly benefit from the status quo," WSMA President Jeff Collins, MD, said. "Failure to enact meaningful reform ... will adversely affect access to care and drive up health care costs."

The proposal contains patient safety initiatives and insurance reform, including a patient compensation fund. Dr. Collins said physicians strongly support patient safety and error reduction projects. But he added that a noneconomic damages cap, a sliding scale for personal injury attorney fees and other judicial reforms need to be included in the package because the crisis is "caused by out-of-control jury verdicts and settlements."

Senate takes aim at employer health benefits

The Senate's Joint Economic Committee recently released a report that faults the current tax exclusion for employer-sponsored health care for contributing to the rapid rise in health care spending.

"Comprehensive group health insurance coverage hides the true cost of health care decisions and fosters the illusion that someone else is paying for the care," said committee Chair Robert F. Bennett (R, Utah).

The tax exclusion also creates a one-size-fits-all approach to coverage and takes control of the purchase of health coverage away from patients, according to the report. Polls and recent labor strikes, however, suggest that employer-sponsored health insurance remains very popular among American workers.

Hospitals urged to help uninsured

The American Hospital Assn. has called for its members to reassess their billing and collection practices for uninsured people. The nation's hospitals recently have come under fire for charging uninsured patients the most and pursuing aggressive legal actions against those who can't pay their bills. New AHA guidelines encourage hospitals to help patients qualify for existing coverage options, to talk with them about payment programs, and to charge low-income patients affordable rates.

Wis. governor signs patient compensation fund legislation

Wisconsin's patient compensation fund will continue to compensate patients who are injured by medical negligence under legislation signed by Gov. Jim Doyle that re-emphasizes the fund's intent. Earlier in 2003, Doyle had proposed taking money from the fund, into which physicians pay, and using it to make up for budget shortfalls in other areas.

"The governor's decision ultimately will benefit everybody in the state by keeping health costs stable and will help maintain patient access to physicians," Wisconsin Medical Society President Paul Wertsch, MD, said.