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WASHINGTON WIRE

April 11, 2008
Issue 165

Senate Finance Committee Chairman Seeks Medicare Action By Mid-May
House Legislation to Delay Medicaid Rules Sails through Subcommittee Mark-Up
MedPAC to Recommend Single Payment Pilot, Primary Care Provider Update
Hearings

Top Story

Senate Finance Committee Chairman Seeks Medicare Action By Mid-May

Senate Finance Committee Chairman, Max Baucus (D-MT), discussed his expectations for addressing a Medicare bill on the Senate floor by mid-May with a group of physician specialty representatives today. Physicians are universally concerned with a 10% payment cut expected to take effect at the end of June and a 15% cut in 2009.

The Chairman told the group that he is seeking an 18-month fix that would create a 20% pay cut in 2010, though he specifically said that he has no intention of letting that cut go into effect at that time. In addition, he wants to continue to tie payments to quality measure reporting and to increase payments to primary care physicians. He also intends to include e-prescribing incentives, address Relative Value Scale Update Committee (RUC) reform, and extend the "medical home" demonstration project on coordinated care for underserved areas in the Senate package. Specialty groups raised concerns that the primary care provision would be paid for through cuts to other specialties as recommended by the Medicare Payment Advisory Commission.
Baucus told the group he does not expect a large Medicare package to pass because of the cost of an 18-month physician payment fix and due to the Senate's pay-as-you-go requirements. The bill, as outlined, would cost roughly $8 billion over five years, which barely covers the cost of an 18-month reimbursement patch and leaves little room for extra provisions. Although the Finance Committee had considered several Medicaid provisions the last time they negotiated a bill, the Chairman said today he is unsure whether Medicaid will be addressed in the Medicare bill. The American Medical Association was not invited to the meeting due to its past opposition to payment fixes that imposes higher pay cuts in the future.

Health Care News

House Legislation to Delay Medicaid Rules Sails through Subcommittee Mark-Up

On Wednesday, the House Energy and Commerce Subcommittee on Health approved the Protecting Medicaid Safety Net Act of 2008 (H.R. 5613), legislation to delay implementation of seven pending Medicaid regulations for one-year. These regulations would restrict community-based rehabilitative services, Medicaid graduate medical education (GME) payments, targeted case management, and the use of provider taxes, amongst other cuts. The legislation has been introduced by full Committee Chairman, John Dingell (D-MI), and Congressman Murphy (R-PA) and currently has more than 150 House cosponsors.

During the mark-up, Chairman Dingell successfully offered an amendment to the legislation which was surprisingly supported by committee Republicans. The amendment modifies some of the language of the one-year moratoria, but does not change their impact. Additionally, the amendment directs $25 million to continue federal Medicaid efforts to fight fraud and abuse. Finally, the amendment pays for the bill by increasing states' ability to verify beneficiaries' assets and borrowing from the "Physician Assistance Quality Initiative (PAQI)" program in 2013. The full committee is expected to pass the legislation shortly.

Full Committee Ranking Member, Joe Barton (R-TX), stated at the hearing that with passage of Chairman Dingell's changes, he would recommend the Administration not veto this legislation. This was a significant development for moratoria supporters as many Republicans and the Bush Administration had voiced their opposition to such legislation in the past.

Senators Rockefeller (D-WV), Snowe (R-ME), and Kennedy (D-MA) have introduced similar legislation (S. 2819) that would also delay implementation of the Medicaid regulations for one-year. The Senate bill also negates a controversial State Children's Health Insurance Program (SCHIP) directive issued by CMS in August which requires states to enroll 95% of children at or below 200% of the federal poverty level before expanding their SCHIP programs to children above 250% of the poverty level.

At the Senate hearing, Dennis Smith, Director of the Centers for Medicaid Services and State Operations at the Centers for Medicare and Medicaid Services (CMS), announced he will be leaving the agency at the end of this week. Herb Kuhn, Deputy Administrator of CMS is expected to temporarily assume Smith's duties.

MedPAC to Recommend Single Payment Pilot, Primary Care Provider Update

The Medicare Payment Advisory Commission (MedPAC) approved recommendations to Congress this week with the goal of promoting cooperation and efficiency through the Medicare payment system.

One such recommendation would initiate a pilot program to issue bundled payments for episodes of treatment to be shared by doctors and hospitals. Physicians and hospitals are currently paid separately for treating patients. However, this pilot program would test the feasibility of using a single payment system which, commissioners hope, will allow for less duplication and waste.

MedPAC also approved a recommendation to increase the Medicare reimbursement for physicians who provide primary care services. Commission staff categorized this payment increase as a major departure from the Medicare Part B fee schedule in that the fee schedule is currently set up to account for differences in resource costs. However, this recommendation is aimed at improving beneficiary access to primary care providers or non-specialists.

Upcoming Events

Hearings

Tuesday, April 15, 2008

Long-Term Health Care
Senate Appropriations - Subcommittee on Labor, Health and Human Services, Education, and Related Agencies
10 a.m., 138 Dirksen

Veterans' Health Bills
House Veterans' Affairs - Subcommittee on Health
10 a.m., 334 Cannon

Instability of Health Coverage
House Ways and Means - Subcommittee on Health
10 a.m., 1100 Longworth

Wednesday, April 16, 2008

Fiscal 2009 Appropriations: Labor, HHS and Education
Senate Appropriations - Subcommittee on Labor, HHS, Education
9:45 a.m., 138 Dirksen

Infections Caused by Health Care
House Oversight and Government Reform Committee
10 a.m., 2154 Rayburn

Health Care Workers and the Elderly
Senate Special Aging Committee
3 p.m., 562 Dirksen

Thursday, April 17, 2008

Veterans Disability Benefits Claims Modernization Act
House Veterans' Affairs - Subcommittee on Disability Assistance and Memorial Affairs
2 p.m., 334 Cannon

For More Information

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