News in brief - Feb. 13, 2012

AMA calls on HHS to halt ICD-10 rollout - CHIP reauthorization boosted kids' health coverage - NEWT Act would close Medicare tax loophole - Bill would ban federal food and beverage ad campaigns

AMA calls on HHS to halt ICD-10 rollout

The American Medical Association has urged Health and Human Services Secretary Kathleen Sebelius to stop the mandated upgrade of the ICD-10 diagnosis code sets.

AMA Executive Vice President and CEO James L. Madara, MD, wrote a Feb. 2 letter to Sebelius calling on the Obama administration to examine the administrative and financial burdens the transition to ICD-10 would have on physician practices. All physicians would be required to use the new diagnosis codes by Oct. 1, 2013.

"In the wake of this onslaught of overlapping regulatory mandates and reporting requirements, HHS has an opportunity to ease the burdens on physician practices by halting the implementation of ICD-10 and calling on appropriate stakeholders -- including physicians, hospitals, payers -- to assess an appropriate replacement for ICD-9 within a reasonable time frame," Dr. Madara said.

The new code sets would impact various administrative functions in a doctor's office. These include verifying patient eligibility, obtaining pre-authorization for services, documentation, public health reporting and submitting claims.

Dr. Madara wrote a similar letter to House Speaker John Boehner (R, Ohio) on Jan. 17 that urged Congress to enact legislation providing physicians with regulatory relief from the ICD-10 mandate.

CHIP reauthorization boosted kids' health coverage

Decreases in the rate of uninsured children since 2008, which occurred even as employer-sponsored coverage declined and the number of kids in poverty grew, were possible in part because of the Children's Health Insurance Program Reauthorization of 2009. That's according to a report released by the Center for Children and Families at Georgetown University to mark the third anniversary of the law's Feb. 4, 2009, enactment.

The national uninsured rate for children decreased to 8% in 2010, a drop of 1.3 percentage points and 1 million children since 2008, according to U.S. Census Bureau estimates. Meanwhile, the childhood poverty rate reached 21.6% in 2010, an increase of 3.4 percentage points.

The CHIP reauthorization gave states several options and incentives to improve their Medicaid and CHIP coverage, according to the report. These include ending the five-year waiting period for legal immigrant children to enroll in Medicaid or CHIP, electronic identity verification through the Social Security Administration, $90 million in Medicaid and CHIP outreach grants, and more than $500 in performance bonuses for states that simplified their Medicaid enrollment procedures and achieved enrollment targets.

The report is available online (ccf.georgetown.edu/index/chipra-at-work-three-years-later).

NEWT Act would close Medicare tax loophole

Rep. Pete Stark (D, Calif.) has proposed legislation to close a tax loophole that would yield billions of dollars to the Medicare program.

The Narrowing Exceptions for Withholding Taxes Act would target self-employed individuals who use S corporations to avoid paying the 2.9% Medicare payroll tax, Stark said. He named the act after Republican presidential candidate and former House Speaker Newt Gingrich, whose 2010 tax returns showed he used S corporations in a way that decreased his taxes by $69,000. Gingrich had earned $444,327 in wages but reported $2.4 million in profits and dividends to his corporations.

A message requesting comment from the Gingrich campaign was not returned by this article's deadline.

Stark said Gingrich is not the only politician to exploit the loophole. For instance, former Sen. John Edwards (D, N.C.) had reported earning $26.9 million as a trial lawyer in 1995. Edwards paid himself a salary of $360,000 for four years and reported the rest as profits and dividends through an S corporation. The move saved Edwards nearly $600,000 in Medicare taxes over four years, Stark said.

A previous version of the legislation passed the House in 2009. At the time, federal estimates showed that closing the loophole would save the government $11 billion over 10 years.

Bill would ban federal food and beverage ad campaigns

Federal agencies would be prohibited from funding advertising campaigns against food and beverages deemed safe under the Federal Food, Drug and Cosmetic Act, according to a bill released on Jan. 31 by Rep. Scott DesJarlais, MD (R, Tenn.), a family physician and member of the House Oversight and Government Reform Committee.

Dr. DesJarlais said he introduced the bill because certain cities spent millions of dollars in federal stimulus package funding on obesity prevention campaigns targeting soft drinks. Other grant recipients -- cities, states and local organizations -- spent some of the same category of grants on parks, soccer fields and other projects to which Dr. DesJarlais did not object.

"As a physician, I believe in promoting and encouraging healthy lifestyles, but the American taxpayer should not be forced to subsidize campaigns that push misleading information intended to scare consumers," Dr. DesJarlais said. Although the stimulus package dollars have been spent and cannot be recovered, the bill seeks to prevent similar future spending. The measure is formally known as the Protecting Foods and Beverages from Government Attack Act of 2012.