MEDICARE: Clinton Proposes ‘Preferred Provider’ Plan
President Clinton Monday sent new legislation to Congress, proposing a "preferred provider" plan that would "steer Medicare patients to certain doctors and hospitals that offer discounts on the price of care" for the elderly and disabled. The New York Times reports that the plan represents a "break from three decades of Medicare policy," in which the program has "provided little financial incentive for choosing a particular doctor or hospital in its fee-for-service" plan. The proposal would furnish the Administration with "broad powers to pick and choose providers who would coordinate the care of Medicare patients" enrolled in the voluntary program, which proponents claim will "save money and would allow Medicare to compete more effectively with private health plans." Doctors and hospitals would be designated "preferred providers" after meeting new HHS standards for quality of care and services; participating providers would make up for discount losses by attracting more patients, Clinton said. Other details of the legislation include designated "centers of excellence" hospitals that would offer the government discounts on "high cost procedures," such as heart surgery or hip replacement for Medicare beneficiaries, and special coordinators to arrange treatment for Medicare patients with conditions such as congestive heart failure, high blood pressure, coronary artery disease, asthma and diabetes. Additionally, in an effort to avoid paying more than retail, the government would "use competitive bidding to obtain discounts on medical equipment and other goods and services." White House Officials hope members of the Senate Finance Committee and the House Ways and Means Committee, set to vote this week on Medicare restorations, will view the proposal as a way to "offset some of the cost of undoing cuts made in 1997" and a plan to "modernize Medicare and save money by using selected techniques of managed care to control costs in the fee-for-service program."
Health to the Lowest Bidder?
Doctors, hospitals and some lawmakers objected strenuously to the plan, charging it would "emphasize price over quality and would steer Medicare patients to mediocre doctors and hospitals that offered the biggest discounts." Dr. Nicholas Kouchoukos, president of the Society of Thoracic Surgeons, said that it is "totally inappropriate to send elderly patients to the 'lowest bidder.'" American Hospital Association Executive Vice President Richard Pollack agreed, pointing out that the proposal also "could reduce access to services in areas where the local hospital did not win a contract with Medicare." While some in Congress, including Sen. Finance Committee members Bob Graham (D-FL), John Chafee (R-RI) and Rep. Pete Stark (D-CA), support the measure, Sen. John Breaux (D-LA), who earlier this year recommended that Medicare compete directly with private health plans, said the proposal, "taken by itself, was 'like robbing Peter to pay Paul.' The government, he said, would cut payments to some doctors and hospitals so it could redistribute the money to others" (Pear, 10/19).