Scully Raises Concerns About Medicare Overhaul
Members of the House Ways and Means health subcommittee "sparred" yesterday with Centers for Medicare and Medicaid Services administrator Tom Scully over a "popular, bipartisan" bill (HR 2768) that would "overhaul" the Medicare contracting system and give care providers "limited regulatory relief," CongressDaily reports. Scully said that the contracting system, under which "providers have more power" than the federal government to choose the companies that process and pay Medicare claims, "is antiquated and has been screaming for reform for the last 20 years." While he said that the Bush administration "generally supports" the bill -- introduced in August by subcommittee Chair Nancy Johnson (R-Conn.) and ranking member Pete Stark (D-Calif.) -- he said that the White House finds two of its provisions "problematic." The first provision would prohibit CMS from enforcing the new policies until 30 days after the bill becomes law. Scully said that provision would allow contractors to "take advantage" of the government during the first month. But Johnson told him that the delay is "specifically related to the lack of clarity in the directives and the amount of paper" providers receive from Medicare. Second, Scully suggested changing the bill's liability standard for Medicare contractors from "negligence" to "gross negligence." He said the bill's current "negligence" standard might "make it difficult to attract" new contractors. CongressDaily reports that in spite of the disagreements, the bill is "the only probable Medicare bill that will move this year" (Rovner, CongressDaily, 9/25).
Scully also told subcommittee members that the administration would like Congress to change the formula by which health plans participating in Medicare+Choice are paid (Rovner, CongressDaily, 9/25). Last week, several health plans announced plans to drop Medicare+Choice coverage for a total of about 536,000 Medicare beneficiaries, saying that reimbursements did not cover their "rising costs of care." Scully said that he has convinced the CEOs of "unidentified" insurance companies to remain in the program for one more year by telling them that Congress may raise reimbursement rates by 2% and "loose[n] some regulations." Scully added that more plans will withdraw from the program in 2003 if Congress does not follow through. "You can put some money back into this program, and that's a top priority for this administration," he said. Johnson said the panel might consider legislation that would increase rates and address aspects of the program that "need to be changed." She said she might consider moving back the annual deadline by which plans must decide if they will remain in the program in order to give Congress time to determine rate increases (Hallam, Bloomberg, 9/25).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.