American College of Physicians: Internal Medicine — Doctors for Adults ®


Policy Briefs

From the June 2000 ACP-ASIM Observer, copyright 2000 by the American College of Physicians-American Society of Internal Medicine.

Court dismisses lawsuit against HCFA

A judge has dismissed a lawsuit protesting HCFA's policy of increasing reimbursements for office-visit expenses while decreasing payments for some procedures.

HCFA is phasing in a new resource-based practice expense system over the next five years that will pay physicians for their expenses based on actual costs instead of historical charges. In 1997, Congress instructed HCFA to begin immediately increasing physician pay for expenses associated with office visits. The increase, which was known as the "primary care down payment," took effect in 1998. To pay for that increase, HCFA reduced payments for procedures that would be cut once the new payment system for practice expenses was fully implemented.

At issue is whether Congress wanted HCFA to change its payment levels only during 1998 or throughout the five-year period during which the new payment system is being phased in. Thirteen surgical and medical subspecialty groups, including organizations that represent cardiologists and gastroenterologists, sued HCFA, claiming that Congress intended the change to occur only in 1998 and not every year until the resource-based program is fully implemented in 2002. HCFA, the College and a number of other organizations disagreed, maintaining that Congress wanted physician pay changed for five years, until the new reimbursement policy is phased in.

In April, a judge ruled that the statute in question precluded judicial review of how practice expenses were determined. The judge also said that even if the Medicare Act did allow for judicial review, the interpretation of the statute to distribute payments was still acceptable.

The College agrees with the court's decision not to force HCFA to eliminate increases in office visit payments, but it does not agree that the courts lacked jurisdiction in this case, according to Robert B. Doherty, the College's Senior Vice President for Governmental Affairs and Public Policy. (For background on the dispute, see the President's Column in the March issue of ACP—ASIM.

ACP—ASIM urges caution regarding proposals to change GME funding

In a letter to the Medical Payment Advisory Commission (MedPAC), the College said that proposals being considered to change how Medicare funds graduate medical education (GME) need further study to ensure that physician work force dynamics don't suffer.

Earlier this spring, MedPAC released a report in which it presented preliminary findings on three proposals that would revise Medicare payment methodology. Two of the three proposals would slash $1.5 billion from Medicare's GME payments. That money would either be given directly to hospitals or returned to the treasury and distributed in the general appropriations process. Under all three proposals being considered, Medicare funding to more than half of America's teaching hospitals would be reduced.

Many teaching programs would see their funding for GME drop by at least 5% under some of the MedPAC proposals. Some programs simply would not survive these reductions, and others would be forced to significantly cut their residency training programs, analysts say. This might eventually result in a shortage of well-trained physicians in some specialties.

ACP—ASIM and 47 other organizations signed a letter stating that Congress needs more information on how the U.S. physician work force would be affected by the MedPAC proposals. The College wants the commission to examine the proposals' impact on the quality of residency training, not merely on teaching hospitals' funding. An additional report with MedPAC recommendations is expected this summer.

ACP—ASIM also urged the commission to further examine these issues and "to include medical training in the discussion of services that justify higher payments to teaching hospitals." Click here to read the full text of the letter, go to sign-on.htm.

College: multicultural standards would hurt physician practices

Proposed standards to provide care tailored to people of various ethnic, cultural and language backgrounds could be financially devastating for some physician practices.

The draft standards, from the Department of Health and Human Services Office of Minority Health, suggest that health care providers and their staff should be trained to respond to linguistic or cultural issues that may arise with patients.

In a statement, ACP—ASIM President Sandra Adamson Fryhofer, FACP, said that the College is concerned that small or solo practices, which often see patients from as many as 50 different cultures speaking different languages, have neither the funds nor the staff to meet the standards. "It is completely unrealistic to expect a health care provider to have someone on staff specifically" to meet each patient's cultural and linguistic needs.

While the standards would be voluntary, the College is concerned that their acceptance could eventually lead to requirements that would put significant financial and administrative burdens on doctors. For more information, see

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