AMA seeks separate Medicare drug funding

Doctors also addressed trouble with Medicare billing policies for skilled nursing facility patients, mammograms and sepsis.

By Tanya Albert, AMNews staff. July 5, 2004.

Chicago -- Concerned that soaring prescription drug costs could lead to a Medicare physician pay cut, doctors want to see a new pool of money created to pay for medications that are now paid out of Medicare Part B funds.

Doctors gathered at the American Medical Association's Annual Meeting in June asked the AMA to urge Congress to develop this new funding stream, which also would include money for the Medicare outpatient prescription drug benefit set to begin in 2006. Currently, drugs administered in physicians' offices and those used with durable medical equipment are covered under Part B. The cost of these medications rose to $8.5 billion in 2002, up nearly 35% from 2001.

The Association also will study how physician reimbursement has been affected by a trend in which doctors are performing more procedures in their offices as outpatient services covered under Medicare Part B. That's a shift away from providing the same procedures in a hospital where they would be covered under Medicare Part A. Doctors believe the change has resulted in lower pay. If the study shows that physicians have seen a significant drop in reimbursement rates, the Association will pursue legislative or regulatory changes to correct the problems.

"This is a major issue for physicians," said Mississippi internist and AMA alternate delegate Daniel P. Edney, MD. "We are being forced to take a double discount."

These are just two of the government payment issues that physicians voiced concerns about at the meeting.