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Physicians' Role in Medicare Payment Overhaul Highlighted

By Jane Norman, CQ HealthBeat Associate Editor

April 10, 2013 -- The time is ripe to permanently fix the Medicare physician payment formula, and there's an essential group that should be pushing for progress and providing input—physicians.

That was the message last week from members of Congress, lawmakers, experts and doctors themselves at a physician leadership event at the Capitol where they talked about the upcoming debate over how to construct a better reimbursement formula. The forum, led by former Medicare director Mark McClellan, was hosted by the Engelberg Center for Health Care Reform at the Brookings Institution.

"You really, really, really, really want to be part of this discussion, if you are a clinician," said Sheldon Whitehouse of Rhode Island, one of the Democratic senators involved in the initial talks in that chamber about how to repeal the Sustainable Growth Rate (SGR) formula.

"And you want the organizations that represent you to be a part of this discussion," he said. "This is a discussion that's going to happen with you or without you. You not being there doesn't stop that. You not being there just makes it a less-educated discussion."

Rep. Allyson Y. Schwartz, D-Pa., earlier this year introduced her own Medicare payment measure (HR 574) with Nevada Republican Joe Heck, and she predicted there will be a permanent repeal. "We've going to get it done this year and we need your help to do that," Schwartz told the doctors at the event.

House Republicans recently released a detailed version of their framework for repealing the SGR, and as they move toward floor action this summer they have said they are looking for reaction from doctors.

Doctors Wary

There's some skepticism, though, that providers will warm to the initial three-phase plan, based in part on quality measures and laid out by the GOP.

Republican Rep. Bill Cassidy of Louisiana, who's a doctor and another player in the SGR debate, said "there cannot be payment reform unless there's physician leadership." And physicians are on edge about dramatic changes in Medicare payments, he said.

"If being the speaker of the House of Representatives is herding cats, then perhaps herding physicians is herding cats on crack cocaine," said Cassidy. "They're very skittish. They're going to take off. They're very nervous."

The discussion on SGR is "more advanced" in the House than in the Senate, said Whitehouse, a member of the Health, Education, Labor and Pensions Committee. However, "I think it's pretty clear that something's got to change," he said, and predicted any Senate plan will emerge from the Finance Committee and Chairman Max Baucus, D-Mont.

"There are a number of us who are continuing to try to kind of flesh out ideas and figure out what the next step is," Whitehouse said, including how to pay for the fix.

McClellan noted that a February report by the Congressional Budget Office said that overhauling the SGR and freezing physicians' payments for 10 years would cost $138 billion—in sharp contrast to an August 2012 estimate of $245 billion. That's led many people to think now is the time to repair the SGR, he said.

Doctors know that prevention, more effective care for chronic disease, care coordination and patient-focused support all are part of the solution for a better payment system, McClellan said. The current fee-for-service system isn't working, and doctors around the country can come up with good ideas about how to implement those changes based on those principles, he said.

But one of those doctors, Allen S. Lichter, CEO of the American Society of Clinical Oncology, expressed frustration with trying to interest the Centers for Medicare and Medicaid Services in demonstration projects of new payment models for oncology. "In the oncology community there is an enormous and pent up willingness to change, to change the way care is paid for," Lichter said. "But this cannot be done by physicians alone. We need the payer side."

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