Yesterday, the Obama administration began to deliver on its promise to improve payments to general internists and other primary care physicians.
A proposed rule released yesterday by the Centers for Medicare and Medicaid Services would make major revisions in Medicare payment policies that "Taken together ... would increase [total Medicare] payments to general practitioners, family physicians, internists, and geriatric specialists by between 6 and 8 percent (before taking into account the proposed update and other proposed changes to the fee schedule)," according to the agency's press release. This shift occurs because the administration proposes changes in the Medicare relative values units (RVUs) for physician work, practice expenses, and medical liability expenses that generally are favorable to primary care, although some surgical and medical specialties also would benefit from the changes. CMS proposes to update the practice expense relative values to use the latest data on physician practice costs from a new AMA survey; this survey, which was co-sponsored by ACP and other specialty societies, show that internists' practice expenses are much higher than CMS previously had assumed.
This change alone would increase total Medicare allowed payments to general internists by 4 percent. Internists would also benefit from changes in the physician work RVUs (another 1 percent) and malpractice RVUs (another 1 percent) for a 6 percent total gain. In aggregate, total allowed Medicare payments to general internal medicine would increase by an estimated $10,061,000, according to CMS, more than any other specialty. (On a percentage basis, some specialties come out higher than general IM, but IM does the best in total dollars because the specialty starts with more Medicare allowed charges than others.)
Not all physicians will be cheering CMS's moves -- by law, changes in RVUs are budget neutral. The agency proposes a big cut in payments for imaging procedures, which would result in deep cuts to cardiologists and radiologists. It also proposes to eliminate the policy of paying for consultations at a higher rate than other initial hospital visits; these dollars would be redistributed to non-consultation visit codes. Many internal medicine subspecialists will likely object to eliminating the distinction between the work involved in consultations and the usual initial hospital visit.
Another change will win the applause of all doctors. The administration proposes to remove physician-administered drugs, like chemotherapy, from the definition of physician services under the Sustainable Growth Rate (SGR) formula. This would have the effect of reducing the negative updates (cuts) to physicians that are triggered whenever spending on physician services (which will no longer include the costs associated with physician-administered drugs) comes in higher than the allowable SGR target. It will also reduce the budget cost to Congress of enacting a long-term solution to the SGR problem by incorporating these costs into the Medicare baseline. ACP, the AMA, and other physician groups had long argued for removal of drugs from the SGR formula.
Public comments on the proposed rule will be accepted through August 31. The Medicare payment changes proposed by CMS, if included in the final rule following public comment, would go into effect on January 1, 2010. ACP will be analyzing the proposed rule, and will seek input from internists, generalists and subspecialists alike.
While ACP may not end up agreeing with every aspect of the proposed rule, it is a very positive sign that the Obama administration has decided not to wait for Congress to begin re-aligning Medicare payment policies toward primary care. Any changes that Congress may subsequently enact, such as providing a primary care bonus payment, would be on top of the new payment scale proposed by CMS.
Another indication of the administration's interest in primary care is that Dr. Fred Ralston, ACP's President-elect and a practicing general internist from Fayettsville, TN, and I will be participating in a primary care roundtable, hosted today by Nancy Ann Deparle, director of the White House Office of Health Care reform, at the White House. You can watch the proceeding via streaming video http://www.whitehouse.gov/ from 2 p.m. to 3:30 today, EDT.
Today's question: Do you agree that these proposed new policies show that the Obama administration is serious about improving payment for primary care?