Bush Administration Has Authority To Reverse Medicare Reimubrsement Cuts for Physicians, AMA Report Says
Doctors groups yesterday called on the Bush administration to take a more active role in addressing Medicare reimbursement reductions, "saying that $62 million in looming [cuts] over the next 10 years could be averted by administrative fiat," CQ Daily Monitor Midday Update reports (CQ Daily Monitor Midday Update, 5/13). With physicians having received a 5.4% reimbursement cut Jan. 1 and scheduled to see payments decrease by a total of 17% by 2005, CMS officials and HHS Secretary Tommy Thompson have stated publicly that the administration does not have the authority to adjust the estimates that led to the payment cuts and that only Congress -- which approved the formula for the decreases in 1997 -- can reverse the cuts by changing the reimbursement formula, CongressDaily/AM reports. Contesting this position, the
href="http://www.ama-assn.org/">American Medical Association released a legal analysis yesterday by former CMS Chief Counsel Terry Coleman, which AMA Chair Terry Flaherty said provides "compelling evidence that the administration has the authority to revise earlier errors to help avert a series of Medicare payment cuts." The analysis also argues that HHS has "incorrectly consider[ed] prescription drugs as part of the physician reimbursement equation." Combined with the "erroneous" estimates in 1998 and 1999 that led to the reimbursement decrease, the administration could restore $62 million in cuts, the analysis concludes. A CMS spokesperson said the AMA analysis "brings nothing new to the table" and added that CMS "does not have the authority" to make reimbursement rate changes.
Hospitals, nursing homes and home health agencies also continue to express concern over provisions in the House Republican Medicare reform package (Fulton, CongressDaily, 5/14). In the draft version of the package, the centerpiece of which is a prescription drug benefit, House GOP leaders attempted to boost doctor payments in part by reducing hospital reimbursements (California Healthline, 5/2). But that plan has been met with opposition from hospital groups and many Republicans who do not want to vote to decrease hospital payments in an election year. Meanwhile, representatives from skilled nursing home facilities, which would likely lose a recently enacted temporary increase in Medicare payments under the GOP plan, are holding a briefing today on Capitol Hill to release two studies showing the potential impact of the cut (CongressDaily/AM, 5/14). And while home health providers would see a 15% reimbursement cut scheduled to take effect Oct. 1 reversed under the House GOP plan, beneficiaries would have to pay a $50 copayment for 60 days of services, causing concern among home health advocates. These issues have jeopardized Republican support for the $350 billion, 10-year House plan, even though it contains a drug benefit, passage of which is widely considered a political necessity this year. "We're not doing the senior citizens a favor if we underfund our hospitals and our home health agencies just to give them pharmaceutical benefits," Rep. John Peterson (R-Pa.) said, adding, "The pharmaceutical benefits are important, but it's more important to have a doctor at a local hospital and home health agencies. ... [The package is] going to be fair, or we're not going to vote for it" (AP/Las Vegas Sun, 5/13).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.