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Quality Improvements for Medicare Patients and Providers

On July 15, Congress voted to override the president's veto of the "2008 Medicare Improvement for Patients and Providers Act" (H.R. 6331), and enacted the legislation into law (P.L. 110-275). Congress' rejection of President Bush's proposed 10.6 percent cut in payments to doctors who serve Medicare patients received the most attention. However, the legislation includes numerous other provisions that will affect Medicare providers and beneficiaries, including those eligible for both Medicaid and Medicare, and will have spillover effects for state Medicaid programs. Several of these provisions align with quality initiatives, medical home concepts, and chronic care models described in this issue of States in Action. Specifically, the 2008 Medicare Improvement Act includes the following provisions.

Primary Care

  • Makes it easier to add preventive services to the list of Medicare-covered services by allowing coverage of services if they are recommended by the U.S. Preventive Services Task Force, and improves the "welcome to Medicare visit" by waiving the deductible and extending the eligibility period from six months to one year (Sec. 101).
  • Adds $100 million and expands the Medicare Medical Home Demonstration Project, which was created in 2006 to explore ways to redesign the health care delivery system to provide coordinated, family-centered services to "high-needs" Medicare beneficiaries with one or more chronic illnesses or conditions that require continuous medical care (Sec. 133). Allows physicians to share in Medicare savings that result from the demonstrations.
  • Reallocates physician scarcity area bonus payments to support primary care only, not specialty services.

Chronic Care

  • Reduces Medicare beneficiaries' coinsurance for mental health services to 20 percent, the same level applied to other outpatient medical care (Sec. 102). Permits Medicare prescription drug plans to cover barbiturates to treat insomnia and seizures and benzodiazepines to treat anxiety, insomnia, and other conditions (Sec. 175).
  • Expands Medicare services related to several chronic diseases, including pulmonary and cardiac rehabilitation (Sec. 144), screening for kidney disease (Sec. 153), and quality incentives related to end-stage renal disease (Sec. 153).
  • Sets up a process to establish a Medicare Chronic Care Practice Research Network to test new models of care coordination for chronically ill beneficiaries (Sec. 150). Establishes a demonstration project to allow states to test new ways to better coordinate hospital, nursing home, home health, and other critical health care services in rural areas (Sec. 123).

Quality and Value

  • Provides $40 million over four years for the Secretary of Health and Human Services to contract with a consensus-based organization (e.g., National Quality Forum) to recommend a national strategy and priorities for health care performance measurement, endorse standardized health measurements, and promote the development of electronic health records that support performance management.
  • Extends the physician quality reporting initiative and provides a 2 percent bonus payment to physicians who report data in 2009 and 2010 (Sec. 131).
  • Requires the Secretary to provide confidential feedback to physicians regarding their resource use compared with others and to submit a plan to Congress regarding transition to a value-based purchasing program for physicians (Sec. 131).
  • Creates new financial incentives to encourage Medicare physicians to adopt technology that would allow them to order prescriptions electronically. E-prescribing reduces medical errors and helps physicians consider cost issues as they make prescribing decisions. Beginning in 2009, physicians who use e-prescribing will receive a 2 percent increase in payments, which is phased out by 2014. In 2014 and beyond, physicians that have not implemented the technology will lose 2 percent of their payments.

For More Information on 2008 Medicare Improvement for Patients and Providers Act
See: Legislation

National Committee to Preserve Social Security and Medicare

American Medical Association

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