[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
HEARING ON MEDICARE'S REIMBURSEMENT CUTS:
THE POTENTIAL IMPACT ON SOLO
AND SMALL GROUP PRACTITIONERS
AND THE BUSINESSES THEY RUN
=======================================================================
SUBCOMMITTEE ON REGULATIONS, HEALTH CARE & TRADE
COMMITTEE ON SMALL BUSINESS
UNITED STATES HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
NOVEMBER 8, 2007
__________
Serial Number 110-59
__________
Printed for the use of the Committee on Small Business
Available via the World Wide Web: http://www.access.gpo.gov/congress/
house
39-380 PDF WASHINGTON DC: 2007
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HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA M. VELAZQUEZ, New York, Chairwoman
HEATH SHULER, North Carolina STEVE CHABOT, Ohio, Ranking Member
CHARLIE GONZALEZ, Texas ROSCOE BARTLETT, Maryland
RICK LARSEN, Washington SAM GRAVES, Missouri
RAUL GRIJALVA, Arizona TODD AKIN, Missouri
MICHAEL MICHAUD, Maine BILL SHUSTER, Pennsylvania
MELISSA BEAN, Illinois MARILYN MUSGRAVE, Colorado
HENRY CUELLAR, Texas STEVE KING, Iowa
DAN LIPINSKI, Illinois JEFF FORTENBERRY, Nebraska
GWEN MOORE, Wisconsin LYNN WESTMORELAND, Georgia
JASON ALTMIRE, Pennsylvania LOUIE GOHMERT, Texas
BRUCE BRALEY, Iowa DEAN HELLER, Nevada
YVETTE CLARKE, New York DAVID DAVIS, Tennessee
BRAD ELLSWORTH, Indiana MARY FALLIN, Oklahoma
HANK JOHNSON, Georgia VERN BUCHANAN, Florida
JOE SESTAK, Pennsylvania JIM JORDAN, Ohio
BRIAN HIGGINS, New York
MAZIE HIRONO, Hawaii
Michael Day, Majority Staff Director
Adam Minehardt, Deputy Staff Director
Tim Slattery, Chief Counsel
Kevin Fitzpatrick, Minority Staff Director
SUBCOMMITTEE ON REGULATIONS, HEALTH CARE & TRADE
CHARLES GONZALEZ, Texas, Chairman
RICK LARSEN, Washington LYNN WESTMORELAND, Georgia,
DAN LIPINSKI, Illinois Ranking
MELISSA BEAN, Illinois BILL SHUSTER, Pennsylvania
GWEN MOORE, Wisconsin STEVE KING, Iowa
JASON ALTMIRE, Pennsylvania MARILYN MUSGRAVE, Colorado
JOE SESTAK, Pennsylvania MARY FALLIN, Oklahoma
VERN BUCHANAN, Florida
JIM JORDAN, Ohio
______
.........................................................
(ii)
C O N T E N T S
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OPENING STATEMENTS
Page
Gonzalez, Hon. Charles........................................... 1
Westmoreland, Hon. Lynn.......................................... 2
WITNESSES
PANEL I:
Burgess, Hon. Michael, Member of Congress........................ 4
PANEL II:
Fedderly, Dr. Brad, American Academy of Family Physicians........ 12
Harris, Dr. Jeffrey P., MD, FACP, American College of Physicians. 14
Rother Allen, D.O., Dr. Melinda, American Osteopathic Association 16
Noller, MD, MS, Dr. Kenneth L., American College of Obstetricians
and Gynecologists.............................................. 18
Whitlow O.D., Dr. John, American Optometric Association.......... 20
APPENDIX
Prepared Statements:
Gonzalez, Hon. Charles........................................... 30
Westmoreland, Hon. Lynn.......................................... 32
Altmire, Hon. Jason.............................................. 33
Braley, Hon. Bruce............................................... 34
Burgess, Hon. Michael, Member of Congress........................ 36
Fedderly, Dr. Brad, American Academy of Family Physicians........ 40
Harris, Dr. Jeffrey P., MD, FACP, American College of Physicians. 49
Rother Allen, D.O., Dr. Melinda, American Osteopathic Association 58
Noller, MD, MS, Dr. Kenneth L., American College of Obstetricians
and Gynecologists.............................................. 74
Whitlow O.D., Dr. John, American Optometric Association.......... 79
(iii)
HEARING ON MEDICARE'S REIMBURSEMENT
CUTS: THE POTENTIAL IMPACT ON SOLO
AND SMALL GROUP PRACTITIONERS
AND THE BUSINESSES THEY RUN
----------
Thursday, November 8, 2007
U.S. House of Representatives,
Committee on Small Business,
Subcommittee on Regulations, Health Care & Trade
Washington, DC.
The Subcommittee met, pursuant to call, at 11:26, a.m., in
Room 2360, Rayburn House Office Building, Hon. Charlie
Gonzalez[Chairman of the Subcommittee] Presiding.
Present: Representatives Gonzalez, Westmoreland, Fallin,
and Jordan.
OPENING STATEMENT OF CHAIRMAN GONZALEZ
ChairmanGonzalez. I now call this hearing to order on
Medicare's Reimbursement Cuts: The Potential Impact on Solo
Practitioners and the Businesses they Run. I have some
preliminary remarks. It looks like we are going to have a vote
in about 15 minutes. My apologies to the witnesses that we
started late and we are going to continue being a little late.
So we appreciate your patience, but your testimony is quite
vital to the work that we are trying to do here. The practice
of medicine is changing. With the rise in managed care,
increased insurance consolidation, and growing paperwork, small
health providers face many challenges. Complicating matters is
that the physician graduate of today faces a much different
business environment than in the past.
Today's hearing will address one of the next great
challenges that could affect the small medical practice. In
2008, Medicare is scheduled to cut physician payment rates by
10 percent. These reductions will continue annually, and it is
predicted that the total cuts will be about 40 percent by 2016.
That could have a devastating impact on the operation of small
medical practices. The potential impact of these cuts must be
considered in light of the fact that these medical practices
function like any other small business, and face low profit
margins.
Physicians are responsible for expenses like rent, payroll,
employee health insurance, and malpractice insurance. Beyond
the Medicare cuts, these general business costs are expected to
increase 20 percent in the next 9 years. Some may find the link
between medicine and money objectionable, but the truth is that
the current business model for the practice of medicine is not
sustainable. At a time when more and more baby boomers are
approaching the age of 65, some physicians have simply stopped
accepting Medicare patients. Already, some practices lose money
every time a Medicare patient is seen. The problem of access to
care will only grow if the Medicare cuts are not stopped. Some
seniors are already faced with calling 20 to 30 providers in
the desperate hope that someone will accept Medicare.
According to a recent survey by the American Medical
Association, 60 percent reported that they would have to limit
the number of new Medicare patients they treat due to next
year's cuts. Half would reduce their staff. Fourteen percent
would completely get out of patient care. That means these cuts
in physician payments will affect everyone, not just Medicare
patients. It is unlikely that the primary care shortage will
improve in the near future, as Medicare reimbursement rates
continue to be a primary driver of physician salaries. Medical
students, already burdened with an average debt in excess of
$100,000, are clearly gravitating towards specialties.
According to the Center For Study and Health System Change,
incomes of primary care physicians fared among the worst in
keeping pace with inflation between the years of 1995 and 2003,
while medical specialists fared the best. The report concludes
that with, "the diverging income trends between these
specialties and primary care," the result is likely to be an
imbalance in the physician workforce, and perhaps a future
shortage of primary care physicians.
The facts are clear. Medicare reimbursement cuts are a
barrier to the successful operation of solo and small group
practices. For many small practices, Medicare is the single
most important source of revenue, and is often used to extend
or supplement charitable care to the uninsured and
underinsured. Cutting Medicare's low reimbursement rates would
result in many practitioners denying or limiting access to
charitable care. Medicare is an important component in
American's health care system. It provides source revenue for
decisions to invest in capital projects like Health IT,
computers, and to expand and offer necessary tests like
mammography services and other preventative screenings. It also
enables small practices, particularly in rural and underserved
communities, to extend the scope of their charitable services.
Without it, many of our Nation's most vulnerable
populations would receive no care. The question is how can we
reform the system to keep the small medical practice viable.
There must be a careful consideration to how those rates are
developed and their impact on small practices. The panel before
us today knows firsthand these challenges. Unfortunately, they
may be put in a situation where they must deny access to care
in order to keep their businesses open and running. I would now
yield to the ranking member, Congressman Westmoreland, for his
opening statement.
OPENING STATEMENT OF MR. WESTMORELAND
Mr.Westmoreland. Thank you, Mr. Chairman, for that
statement and for holding this hearing today. I would also like
to thank all the witnesses for their participation. And I am
sure today's testimony will prove to be very helpful in any
decisions that we would make in trying to fix a problem.
Medicare's Physician Payment Program is an issue of great
concern, not only in my district, but all over the country.
Mr. Chairman, I know that you and I agree that the
Sustainable Growth Rate, the SGR, specifically is a system that
needs to be examined carefully. And I hope the testimony today
will give us some direction in how to do that. With an issue as
complex as this, I think it is important to lay out all the
facts. We know that the SGR system was designed to respond to
concerns that the fee schedule would not adequately control
overall increase in physicians' services. Also, we know that
the SGR is a formula targeted for cumulative spending.
Unfortunately, we also know that in the past few years,
expenditures have been significantly above the formula's
target, causing cuts to physician payments. Congress has
attempted to treat the symptoms by placing legislative Band-
Aids on the problem and overriding the reductions.
However, we have yet to fully treat the illness, and I
believe that our work here today is a step towards that goal.
It is important that we have an honest and frank discussion
about the situation that we now face. There is a growing, and,
in my opinion, real concern that physicians may be unable to
absorb continued payment cuts. I know that the fallout of such
a scenario is something that we all want to avoid. My wife had
surgery, Mr. Chairman, Monday. And as I was talking to the
surgeon, he said that his daughter had come to him and talked
to him about going into the medical field. And he had to give
her advice that she may want to reconsider what she was doing.
I think that is a real shame to that profession. But I welcome
these distinguished panels today and thank you for your
willingness to have this hearing and their willingness to
testify.
ChairmanGonzalez. And I thank the ranking member. The first
witness--and first of all, of course, the first witness knows
the rules, but for the benefit of the witnesses that will be
following Dr. Burgess, you will be given 5 minutes within which
to present your testimony. You have submitted a written
statement that will become part of the record. We will refer to
it, as well as staff, as resource. And then, of course, you may
be able to follow up on that which you didn't think you could
cover in your 5 minutes in the question and answer period. And
I think we are going to have plenty of time. And again, I seek
your indulgence and your patience, because I think we will have
a vote in a few minutes.
Panel one consists of one witness. But I am proud to
introduce our first witness, the Honorable Michael Burgess from
Texas. Congressman Burgess was elected to Congress in 2002 to
represent the 26th Congressional District from the great State
of Texas. Before heading to Congress, Congressman Burgess
practiced as an OB-GYN for more than 21 years, delivering 3,000
babies. 1,501 of those babies turned out to be Democrats. I
added that. That is not true. He is the founder--
Mr.Burgess. They are still young.
ChairmanGonzalez. --of Obstetrics and Gynecological
Associates of Lewisville. Our colleague--and I want to tell our
audience, because I was sharing this with Lynn, I saw Michael
on the floor as we were voting, and I said get ready for a real
grilling, Mr. Witness. He said get ready for my answers. So my
pleasure to introduce Congressman Michael Burgess.
STATEMENT OF THE HON. MICHAEL C. BURGESS, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TEXAS
Mr.Burgess. Thank you, Chairman, and Ranking Member
Westmoreland, for giving me the opportunity, extending me the
courtesy of allowing me to talk about this on this morning. As
you know, from knowing me for the past 5 years, I will talk
about this issue literally at the drop of a hat anywhere at any
time. So I am happy to be here talking to your Subcommittee and
taking some time to highlight this so that the decision-makers
can get a greater understanding of a very serious issue that
faces medicine. Most of us, unless we are in our first term, we
have been through a couple of these in the past. And when I say
these, I mean, what happens between Thanksgiving and New Year's
Eve, when we deal with the proposed physician payment cuts that
have now been set by the Centers for Medicaid and Medicare
Services on November 1st.
And I believe they were assessed this time at a 10.1
percent cut this year unless Congress acts. Every year that I
have been in Congress, Congress has acted before that final
date except for 2005, when doctors were delivered an at that
time I think it was a 5 to 6 percent reduction, and my fax went
wild over New Year's weekend, with doctors all over the country
saying, okay, you have done it now, let me show you the letter
that I am sending out to my patients. They were leaving the
practice of Medicare in droves.
I can promise you if it was that bad at 5 percent, it is
going to be even worse at 6 percent. It is not that my fax
machine can't handle it, but I worry if the practice of
medicine can. We usually act in Congress, but when we act, we
not only are not fixing the underlying problem, but we are
making the ultimate fix of the underlying problem that much
worse. And it is for that reason I am really ambivalent about
what happens this year, whether it is a 1-year or 2-year fix.
And we hear both being talked about over at Senate Finance. I
haven't heard much talked about on this side of the Capitol.
But whatever we do, whether it is a 1-year or 2-year fix, we
are just delaying the pain and we are making the ultimate
solution that much harder.
When I first thought about running for Congress in December
of 2001, the first Medicare cut came to the house of medicine
in this country at a time the budget was in surplus. And quite
frankly, many of us at the AMA House of Delegates that year
just frankly could not understand why it was necessary to do
that. And we were told don't worry, Congress will fix the
problem.
Indeed, they did not in 2001, so the year 2002, my last
year of active practice, Medicare reimbursement declined 5.4
percent. As a consequence, most of the doctors who practice my
specialty in my part of the county discontinued taking Medicare
from their practices. I continued because my mother told me I
had to. But as a consequence, when I left to Congress it was
quite a vacuum that was left behind for that patient
population.
Now, in the last Congress, in the 109th Congress, I
introduced a bill, 5866, and perhaps relatively naively said
let us just repeal the SGR formula, find a way to pay for it,
we are people of good will, we can figure this out at the
Committee level, and no one has to actually have the individual
target on their back, but I was wrong. Even failing to
delineate payfors, I did attract a lot of negative energy with
the introduction of that bill. But the reality was we need to
do something. Now no sooner was the ink dry on the fix that we
did at the end of last year, on the tax extender bill, than I
knew we had to work on this. Mr. Chairman, we have really got
to approach this from a short-term, a mid-term, and a long-term
strategy.
And that is really what has been lacking, and in all
candor, when my party was in charge the first two terms that I
was here, but it still seems to be lacking today. We need that
short-term, mid-term, and long-term strategy to deal with this.
So in 2006, December of 2006, we tried to reframe the problem
that would dispose of the Sustainable Growth Rate formula and
replace it with the Medicare Economic Index, but I also
proposed that we do that over a transition period that would
take some time to do that. We had a lot of discussions, and I
am grateful to the input from the American Medical Association,
the American College of Surgeons, American Osteopathic
Association, my colleagues, the American College of OB-GYN,
that laid out some principles that would lay the foundation for
legislation that eventually came to be known as 2585. It was
introduced earlier this year.
I believe that these principles are transformational in
nature, and will help this House avoid solutions that are
merely transactional or cosmetic and make the problem worse.
Number one, the SGR formula, Sustainable Growth Rate, it is
insufficient to meet the cost of physicians or even a
methodology that allows the physician to plan for the future.
So it must be repealed. Medicare reimbursement must fairly
compensate physicians to provide the services.
Any new Medicare payment system must be able to adjust for
growth in service, but agile enough to determine what
constitutes appropriate growth in service volume. Any future
cost containment device must be delinked to trends in the
economy, unlike the SGR. Quality reporting should encompass a
variety of options, and should be voluntary. Implementation of
health information technology should be rewarded, but also
should remain voluntary. The solution is actually extremely
simple. It is so simple we forget about it sometimes. The
solution is stop the cuts, repeal the formula. And that is the
concept on which I based the legislation that I introduced,
2585, in this Congress. It eliminates the SGR formula in 2
years' time. What happens to the doctors in 2008 and 2009? Is
the SGR formula in fact going to result in these 10 percent
cuts? You can actually readjust the baseline, reset the
baseline. And that was done in the legislation that I
introduced. And it scored from the CBO as about just bit little
less than an MEI update for 2008, and a little under that for
2009, but still positive updates, and nowhere near the 10
percent cut that has been proposed for this year. And then in
2010, the formula is repealed outright. I would love to go into
Part A to take the money to just pay for the repeal of the SGR,
but I am not allowed to do that.
So all of the savings that we are achieving in Medicare
currently, and we are achieving some savings in Medicare.
Remember the Trustees report that came out in June of this year
said the bad news is Medicare is going broke, but the good news
is it is going to go broke a year later than we told you last
year.
So that year of savings, if you will, although it is
savings that accrues to Part A, because now Part A trust fund
is not going to be into bankruptcy until a year later than we
told you last year, but really that savings occurred in Part B.
But Part B still got charged for that money. Why not give that
money or sequester that money or hold that money for Part B and
then let us pay for the repeal of the SGR with that money that
we have held, the lock box from 2000 that no one is using
anymore.
Let us bring that lock box out and put those savings in the
lock box--I don't think Al Gore needs it anymore--and we will
hold this money to repeal the SGR formula. Now we really do
have to be careful with some of the things we do because we all
know we have a problem with disparities in this country. And we
don't want to make the issue of disparities worse by creating
new problems with the SGR formula.
Let me just wrap up with this: During his last days on
Capitol Hill, Alan Greenspan was doing a couple victory laps
around the Capitol, came to talk to a group of us one morning.
And the question inevitably came up after his talk, well, Mr.
Greenspan, what are we going to do about Medicare? What are we
going to do this unfunded liability? And he thought for a
minute and he said it is going to be very hard, but I think
when the time comes Congress will make the correct decisions
about what to do to keep Medicare solvent. And then he stopped
for a minute, he thought, and he said what concerns me more is
are you going to have anyone there to deliver the services when
you require them? And that hit me like a ton of bricks.
So that is why I have focused on this issue for the last 2
years, and why it is my overarching consideration for if I get
nothing else done in Congress, if I can get this system
changed, it is incumbent upon me to do that. Finding a solution
is going to be the key to the problem that we face with
physician workforce issues in this country. And we are coming
up on some serious ones.
I had two companion pieces of legislation that I won't go
into today, but they dealt with the student contemplating a
career in health care and they dealt with the individual who is
in residency programs today. Everything for me comes down to
this when I think about health care policy in this Congress.
What is the fundamental unit of production of the American
medical machine? If the American medical machine was cranking
out a widget, what would that widget look like? It would look
like the doctor-patient interaction in the treatment room.
Anything that we do that delivers value to that doctor-
patient interaction in the treatment room is something I will
look at and something that bears giving a careful assessment
to. Anything that detracts from value is really not something
that I am interested in pursuing. Well, you cannot, I will
submit you cannot deliver value to the doctor-patient
interaction in the treatment room if you have no doctor there
in the first place. So this becomes central to again, to
everything that I do as I spend my time here in Congress. The
fact is no doctor can continue to practice with what we are
asking them to do. I ran a medical practice. Yes, it is a small
business. What is the biggest cost when you are in a small
business? It is the cost of capital. Usually that is for hiring
a new doctor or buying a piece of equipment. We can't plan
because we don't know what Congress is going to do to us in the
future.
If we come up with a formula for getting rid of the 10
percent cut this year the price tag of the $268 billion to
repeal SGR over 10 years time next year becomes over $300
billion. Every year we delay we make it worse. If we had taken
this approach, short-term, mid-term, long-term when I first
arrived here and we did the first omnibus in 2003.
The fact is we would be pretty much past this problem now
and we could all argue about something else. And wouldn't we be
happy doing that? I know I have gone a little bit long, and I
thank you for your indulgence, and I will yield back my time.
[The prepared statement of Mr. Burgess may be found in the
Appendix on page 36.]
ChairmanGonzalez. Thank you very much, Congressman Burgess.
I am going to suggest--it is one vote. That is my
understanding. It is one vote. Why don't we get over there,
vote real quick, make sure we all get back at the same time.
And then we will open it up and have some questions for you.
Mr.Burgess. Very good.
ChairmanGonzalez. And we will stand in recess until we get
this vote out of the way. Again, to the other witnesses, thank
you for your patience. We will be right back.
[Recess.]
ChairmanGonzalez. The Committee will reconvene. We were
going to wait for Mr. Westmoreland, and he is on his way.
However, I am going to go ahead and pose a question to Dr.
Burgess, our first witness. And I will explain to the other
members if they get here, of course, that we are going to limit
ourselves to the five-minute rule.
Dr. Burgess, I guess the question, and it is a mystifying
formula for doctors, but even more so for Members of Congress.
And I am just going to read from the memo that has been
provided and prepared by our staff. And this is how confusing
it can be to us.
And I guess I want you to sort of explain it, but also the
difference of what you are proposing and what you think might
be the answer. What does the Sustainable Growth Rate mechanism
do? The SGR system sets spending targets for physician services
and adjusts payment rates as needed to bring spending back in
line with those targets. Which kind of puts you on notice that
we are probably going to have problems, right?
The SGR target for total spending is based on spending in
an initial or base year and the estimated growth in real per
capita GDP each year and three other factors that affect
overall spending on physician services: The changes and cost of
inputs used to produce physician services such as measured by
the Medicare Economic Index, the MEI, the number of Medicare
beneficiaries in the traditional fee-for-service program, and
expenditures that result from changes in laws or regulations.
The spending target for physician payments is applied by
incorporating it into the adjustment to the conversion factor
that determines the payment amount per service.
The conversion factor is determined annually by adjusting
the previous year's conversion factor by the change in the MEI
to account for the cost of inputs for physician services and
adjusting this product on the basis of the relationship between
the cumulative SGR target and Medicare physician spending. The
conversion factor update is greater than the MEI when physician
spending has been below the targets and is less than the MEI
when the physician spending has been higher.
Does that make sense to you? Do you understand it? And if
you do, can you decipher it? But truly, the serious question is
whether there a real life application of this to what the
physician faces today in their practice?
Mr.Burgess. You want the theory or the application?
ChairmanGonzalez. I think application. The practical--you
know, theory is good, but the practice is what counts.
Mr.Burgess. From a perspective of a practicing physician,
this formula is fantasy. It is fiction. It is made up.
ChairmanGonzalez. Is your mike on?
Mr.Burgess. From the standpoint of the practicing
physician, the formula is fantasy, it is fiction, it is made
up. We don't understand why how in reality the GDP in this
country for the short time that I have been in Congress has
actually done pretty well. Heaven help the doctors of the world
if we had a couple quarters that we were in recession because
it would have hurt worse. From the perspective of someone who
spent now the last 5 years as sort of an amateur health policy
person, yeah, I spent some time studying the formula and
studying the various relationships.
Some things make sense, some things don't. But you got down
to it at the end of your discussion about the allocation based
upon the conversion factor. And where we really get hurt is
with what is called the conversion factor of the prior year
times the conversion factor update. The update is then one plus
the MEI over a hundred times one plus the UAF. The UAF is the
bad actor here. The update adjustment factor makes actual
expenditures and target expenditures equal, which I believe you
alluded to in the first couple sentences of what you addressed.
That is not based on reality. And Medicare has never, ever paid
enough to equal what the commercial insurance will pay. They
just never have.
And I think--I can't speak to it, because I wasn't here,
but I think the philosophy was that if a doctor takes Medicare
we will pay them just enough so that they go broke slowly, and
they are able to continue in their business for a number of
years and provide care for our patients. But the reality is if
you construct a practice that is primarily Medicare, even in
the heady days of the late 1980s and early 1990s, you were
still hard put upon to make that practice go, because nothing
in what the economists who figure this stuff and figure out the
numbers for relative work values, it is always figured on the
cost of delivering care, and it never figures in an amount for
what do you pay the physician at the end of the day? There is
never an amount in there for the doctor actually making a
salary. So even back in the old days, it was never a formula
that was based on reality.
And unfortunately over time, because of the influence of
the what we call the update adjustment factor, we compound the
problem over time such that this year we face a 10.1 percent
cut if we legislatively don't do something. So we will do
something. I will predict that we will do something. That
something will be we spend $40 billion to prevent that 10
percent cut. But now what happens when I say the cost of
repealing the SGR, the CBO scores it at $260 billion over 10
years time, since we added $40 billion to the price tag, the
$40 billion doesn't come off the top of the SGR, it is added to
the end of the out year.
So the next 10-year moving budgetary window the cost is
that much more. And again, as I said in my opening statement, I
suspect it will be over $300 billion. And it becomes a hill too
far. No one want to take it on. I am not supposed to say this,
but in my mind the money has already been spent. You have
already paid these fine doctors for the business that they
conducted on your behalf.
So the money has already been spent. We just haven't
accounted for it on the books. So we just play this little
shell game. And year over year, we kind of hold this money off
the books because we are going to recoup it from the doctors by
and by putting into play the SGR formula. But the reality is
the money is not sitting there in the Federal Treasury waiting
to go to the doctors. It went to the doctors. They provided the
care. They paid their overhead. That money has been spent and
is gone.
That is why I would like for us to take the type of long-
term strategy that gets us past this point. Because eventually
we will be in a hole so deep that we just simply can't do
anything about it and we are locked in forever. These guys
won't continue to practice. Younger guys will look at it and
say, you know, and ladies, will look at it and say that I don't
know that it is worth it going into medicine anymore. And we
will irreparably harm the profession. And is that bad? I submit
that it is, because we are on the cusp of a time when medicine
is going to deliver in ways I didn't think possible when I
started medical school. We are on the cusp of a
transformational change in medicine the likes of which we have
never seen.
The era of personalized medicine, the value of cracking the
genetic code and the work that has been done on the human
genome. Look what happened last Monday Francis Collins got the
Medal of Freedom by the President. That was a significant
event. And the reason he got that medal was because of his work
on breaking the genetic code and because of the promise that
genetic medicine is going to play in the future, very
personalized medicine. A year ago, when we were having our NIH
reauthorization hearing, the doctor from Johns Hopkins, and
right now I am blocking out his name, talked about the fact
they have decoded the genetic sequence for the 20 genes
involved in colon cancer. What a powerful tool to puts in the
hands of researchers. We are probably just a few steps away
from actually stopping that disease.
ChairmanGonzalez. I have exceeded my 5 minutes, and I do
need Lynn to--and I know that you are looking to the future,
and I appreciate that. And the question is, you know, the
Federal Government has basically invested in health care with
the Medicare Act of 1965. And we have to figure out how we are
going to deal with it. But I appreciate your response. And at
this time I would recognize my colleague, the ranking member,
Mr. Westmoreland.
Mr.Westmoreland. Thank you, Mr. Chairman. And Congressman
Burgess, I know that you talk about the fix, and the Band-Aids
that have continually been put on. And I believe there are
several bills that have been introduced that do a fix to the
SGR, where yours does away with it in some gradual steps. Do
you think that there is any way it can be fixed for a short-
term, or do you see the only real solution to this as just
doing away with the SGR completely?
Mr.Burgess. Well, I think I said that in my testimony. The
ultimate solution is stop the cuts, repeal the SGR. And how we
get to that point is really the rest of the argument. I have
proposed a fix that is postponed. I did that because simply
trying to repeal the SGR in one fell swoop didn't seem to gain
a lot of traction. What does gain a lot of traction, and in
fact, the doctors and their groups do a good job of educating
members of Congress that we have got to do something.
So we get to the end of the year and we play it out every
year, just really predictable, sometime between Thanksgiving
and New Year's Eve, we will have something delivered to us. I
cannot believe going into an election year we are going to
allow this to be an unresolved issue. No one wants that. This
will be our last--you know, obviously 2008 is the election
year, but this is our last chance to do something to protect
the physician community in this country before the November '08
elections, because anything that is done next year will
obviously be done after election day. So this is our chance to
show some resolve to our physician community, to our health
care community. And I hope we take that up and do it.
I am not saying we have got the perfect answer. But I think
the problem has gotten so large that while it is still fixable
it is going to take an approach where you divide it up and you
get some now and you get some later. And quite honestly, that
was the discomfiture. I know the American Medical Association,
the American Academy of Family Practice, the American
Association of Physicians had some difficulty with the concept
that they were going to go back to their members and say, hey,
we are supporting a plan that repeals the SGR, but it doesn't
do it for a couple years. That is pretty untenable. You can
imagine walking into the House of Delegates at the AMA and
having to give that sort of report. That is why I tried to
build in some protections for the doctors for the next 2 years.
There is the mid-term strategy that we have to employ, because
if we drive everyone out of medicine in the next 2 years, it
doesn't matter that we have repealed the SGR.
Mr.Westmoreland. Well, Congressman, let me ask you this.
The SGR, when it was put in place, it was kind of destined to
fail anyway, was it not, because it was not indexed for
inflation? And anybody that doesn't believe that your cost is
going to go up, you know, is not being very realistic. So was
the SGR put in as--I hate to say this--but kind of some of the
smoke and mirrors we have seen in this Congress as a payfor for
the Medicare?
Mr.Burgess. I don't know. I can't speak to it because I
wasn't here. Obviously, I was on the receiving end, and it was
a way to control growth. And the other term for controlling
growth is a way to ration care. And we would ration it in the
treatment room. That way people sitting on the Committee didn't
have to ration the care, the people who administer over at CMS
didn't have to ration the care, it would be the doctors who
would ration the care because after all, in our American
healthcare system--
Mr.Westmoreland. Did the AMA not see this coming?
Mr.Burgess. I don't think they have ever endorsed the SGR,
not that I recall during my tenure with the AMA. But the
reality was in the early years, right after the Balanced Budget
Act was passed, and I don't want to put it all on the Balanced
Budget Act because I don't remember the three letter acronyms,
but there were precursors to the SGR that were essentially the
same philosophical trajectory. And this is not a problem that
is owned by one party or another. It is a problem that is owned
by Congress in general.
Mr.Westmoreland. I wasn't here either, but it seems to me
like this was some kind of gimmick pay for that has had some
unintended consequences when it comes to the health care for
the people in this country.
Mr.Burgess. If I may, it was a reaction to the reality that
paying on a fee-for-service basis in Medicare, even though it
was vastly less than what other fee-for-service payment models
were, it was still Medicare was growing faster than anyone ever
thought possible. And I mean we know that from looking at our
history books. The number, who would have believed that we
would be spending over $300 billion a year on Medicare.
Mr.Westmoreland. I understand. But rather than cutting
doctors' pay, you know, we have expanded so many of the
services and really broadened those people that can get the
service. To me that was, you know, not very well thought out.
Mr.Burgess. It is a disconnect. And I have heard people
suggest that maybe congressional pay ought to be run through
the SGR formula, and then maybe that would improve our resolve
for getting it done.
Mr.Westmoreland. Thank you.
ChairmanGonzalez. I will make sure I tell the other members
of Congress, Michael, what you are proposing.
Mr.Burgess. Take two of those and call me in the morning.
ChairmanGonzalez. Thank you very much, Dr. Burgess, for
your testimony.
Mr.Burgess. Thank you.
ChairmanGonzalez. We are going to set up for the next
panel. And as we are sitting up I am going to remind the
witnesses that they have 5 minutes. And I know that Dr. Burgess
went over his 5 minutes, but that was some sort of a
professional courtesy, I guess. And again, though, and the
reason is I want to get your testimony in before we have the
next round of votes and get a couple of questions in. And I
would be very curious, and I am sure that Congressman
Westmoreland may be curious as to how you view Dr. Burgess's
testimony and his suggested solution.
The other thing that I want to explain to the witnesses is
that you are before the Small Business Committee of the U.S.
House of Representatives. And you may wonder, you know, how do
we play a role? Because we think of you, of course, as
practitioners out there as small businesses. And so that our
policies impact your ability to conduct business. But you are
the last standing profession in the United States also. But you
are still a business. The Chairwoman Nydia Velazquez meets
every week with the Chairs--and please, if the witnesses will
take their places at this time--Nydia Velazquez meets with the
Chairs of all other committees once a week, and they have a
discussion of shared concerns. That is why your appearance
today is very important, because she will be discussing what
transpires here today with the chairs of the Committees on Ways
and Means and Energy and Commerce. And we all have a shared
jurisdiction.
So we will get our voice heard. And we are hoping that
through us your voices will be heard. What I am going to do is
introduce the witnesses as they testify. So it is my pleasure
to welcome Dr. Brad Fedderly. Dr. Fedderly serves on the board
of directors of the American Academy of Family Physicians,
AAFP. AAFP is the national association representing family
doctors, and one of the Nation's largest medical organizations,
with more than 94,000 members throughout the United States. Dr.
Fedderly practices with the Wheaton Franciscan Medical Group, a
full service primary care large group practice in South
Milwaukee, Wisconsin. He earned his medical degree from the
University of Wisconsin, and completed his residency at the
University of Massachusetts family practice residency in
Worcester.
STATEMENT OF BRAD FEDDERLY, ON BEHALF OF THE AMERICAN ACADEMY
OF FAMILY PHYSICIANS
ChairmanGonzalez. At this time I welcome the testimony of
Dr. Fedderly. You may proceed, sir.
Dr.Fedderly. Chairman Gonzalez, Representative
Westmoreland, and members of the Subcommittee, I am Dr. Brad
Fedderly, as you just heard, a member of the board of directors
of the AAFP. I am pleased to provide testimony on behalf of
nearly 94,000 members who provide medical care for 50 million
of your constituents. The Academy commends the Subcommittee for
your consistent efforts to ease the burdens of small businesses
in this country. Family physicians share the Subcommittee's
concerns that the current payment system is inaccurate and
outdated. Therefore, AAFP supports the restructuring of
Medicare payments to reward care coordination and quality and
to prevent expensive and duplicative tests and procedures.
About 25 percent of all office visits in the United States are
to family physicians, nearly half of whom work in small and
medium-sized practices of five physicians or less, small
business practices that operate with tight financial margins.
Medicare beneficiaries comprise about a quarter of the typical
family medicine practice. Therefore, an accurate and more
contemporary Medicare physician payment method is key. AAFP
appreciates past Congressional action that avoided a 5 percent
payment reduction in the Medicare fee schedule for 2007.
Nevertheless, reimbursement rates for physician services are
lower today than they were in 2001. Moreover, if Congress does
not act in the next 7 weeks, reimbursement for family
physicians will decline 10.1 percent in 2008, and 5 percent
more in 2009.
In fact, scheduled cuts of nearly 40 percent over the next
9 years will render the operation of small business medical
practices unsustainable. From the outset, the Medicare program
has based physician payment on a fee-for-service system. This
system rewards individual providers for ordering more tests and
performing more procedures. This system does not pay physicians
to coordinate the patient's care generally, and has resulted in
an expensive, fragmented Medicare program.
AAFP recommends that Medicare incorporate a fee for
physicians who coordinate the care of Medicare patients. This
should be a blended model that combines fee-for-service with a
monthly care coordination payment. Such compensation will go to
the physician practice chosen by the patient. And any physician
practice prepared to provide care coordination should be
eligible to serve as a patient's personal medical home.
Patients who select a personal medical home should be rewarded
with reduced copays and reduced deductibles. This model has
already been proven effective. North Carolina has employed the
Medical Home model in its Medicaid program, and saved taxpayers
more than $231 million in fiscal years 2005 and 2006.
Effective care coordination requires affordable health
information technology in the form of an electronic health
record in the physician's office. Using HIT also reduces errors
and allows for ongoing care assessment and quality improvement
in the practice setting, two additional goals of the recent
Institute of Medicine reports. But cost continues to be a
significant barrier.
AAFP joins the Institute of Medicine in encouraging Federal
funding for physicians to install HIT systems, which according
to HHS, will save billions. Funding must be directed to the
systems that will provide the best return on investment. We,
therefore, encourage Congress to consider funding in the form
of grants or low interest loans for those small group and solo
medical practices committed to integrating health information
technology in their practice. In closing, AAFP urges Congress
to modernize Medicare by embracing the patient-centered Medical
Home model as an integral part of the program and to reform the
payment system in the following three ways.
First, enact a 2-year positive update to the payment rate
and use the time to develop a replacement for the dysfunctional
SGR formula. This new formula must consider and reflect the
change in the costs for small business medical practices to
provide care.
Second, adopt the patient-centered medical home and give
beneficiaries incentives to use this model with reduced copays
and deductibles. The physician designated by the patient as the
medical home shall receive a monthly payment for the non-face-
to-face services associated with care coordination.
And third, provide health information technology grants and
low interest loans to solo and small group medical practices
that provide a patient-centered medical home to Medicare
beneficiaries. AAFP commends the Subcommittee for its
commitment to identify a more accurate and contemporary
Medicare payment methodology for physician services, one that
recognizes and fosters the important small business model used
by thousands of family doctors across America. Thank you for
the opportunity to speak today, and I look forward to your
questions.
ChairmanGonzalez. Thank you very much, Dr. Fedderly.
[The prepared statement of Dr. Fedderly may be found in the
Appendix on page 40.]
ChairmanGonzalez. The next witness is Dr. Jeffrey P.
Harris. Dr. Harris is the president-elect and former chair of
the Board of Governors of the American College of Physicians'
American Society of Internal Medicine. The ACP is the Nation's
largest medical specialty society. Its membership comprises
more than 115,000 internal medicine physicians and medical
students. Dr. Harris has practiced internal medicine and
nephrology in Winchester, Virginia, since 1977. He is a
clinical associate professor at the University Virginia School
of Medicine. Thank you very much, Dr. Harris, and you may
proceed,
STATEMENT OF JEFFREY HARRIS, M.D., FACP, PRESIDENT-ELECT,
AMERICAN COLLEGE OF PHYSICIANS
Dr.Harris. Good morning, Mr. Chairman, and members of the
Committee. As you have heard, I am Jeff Harris, president-elect
of the American College of Physicians. I have been a general
internist for 3 decades. As clinical associate professor of
medicine at the University of Virginia School of Medicine, I
have been involved a bit in community-based teaching for third
year medical students. The College is the largest medical
subspecialty society in the United States, representing 124,000
internal medicine physicians and student members. Among our
members involved with direct patient care after training,
approximately 20 percent are in solo practice, and
approximately 50 percent are in practices with five or fewer
physicians. Until recently, I have practiced in a town in
Virginia with a population, as you heard, of about 50,000.
My practice focused on the delivery of primary care and
nephrology. We routinely saw overhead expenses which exceeded
60 percent. As a community small business, we discovered
firsthand the financial struggles of an uncertain and low
Medicare reimbursement and the effect it had on our practice.
We greatly appreciate Subcommittee Chairman Gonzalez for his
focus of the attention on the impact of the Medicare's flawed
physician reimbursement formula and the effect it has on small
and solo practitioners.
These are the practices that are the least able to absorb
the uncertainty of annual payment decreases and the below
inflationary adjustments Congress has grown accustomed to
making. The College offers three points for the Committee to
consider. Number one, the College believes that the Medicare
payment policies are fundamentally dysfunctional and do not
serve the interests of Medicare patients. These policies have
an especially negative impact on solo and small practices.
In particular, Medicare payment policies discourage primary
care physicians from organizing care processes to achieve
optimal results for patients. Research shows that health care,
managed and coordinated by a patient's personal physician,
using a system of care centered on the patient's needs can
achieve better outcomes for patients and potentially lower the
cost by reducing complications and hospitalizations. The
American College of Physicians, joined by the American Academy
of Family Physicians, the American Osteopathic Physicians, and
other physician groups have adopted the concept of care
delivery called the patient-centered medical home.
The second point we would make is that the dysfunctional
Medicare payment policies have resulted in a dwindling
workforce of primary care physicians at a time when the aging
population is growing and more Americans are living with
chronic diseases. As a community-based teacher for the
University of Virginia, I have had the pleasure of teaching
third-year medical students in our office setting. These
youngsters are uniformly excited about the unique challenges
and the opportunities of being a patient's primary care
physician. But when it comes to choosing a career path, very
few see a future in primary care.
Now medical students are acutely aware that Medicare and
other payers undervalue primary care and overvalue subspecialty
medicine. With the national average student debt of $150,000,
by the time they graduate from medical school, students feel
that they have no choice but to go into more specialized fields
and practices that are better remunerated. The precipitous
decline in young people entering the fields of primary care is
occurring at the same time we are witnessing the fact that only
35 percent of the nation's internists, 35 percent of them are
over the age of 50, with increasing numbers retiring from
practice early due to frustration with practice difficulties
like the SGR. Coincident with this declining number of
internists, our country has an aging population, with a growing
incidence of chronic disease, who will need more primary care
physicians to take care of them.
As you know, within 10 years, 150 million Americans will
have one or more chronic diseases. And the population over the
age of 85 between the years 2000 and 2010 will increase by 50
percent. Our final point is that Congress must take immediate
steps to avert the 10.1 percent reduction and work towards
eliminating the SGR. It is essential that Congress act this
year to avert more SGR cuts. But we urge Congress not to simply
enact another temporary fix without moving in a direction of
replacing the underlying formula. The so-called Sustainable
Growth Rate is simply not sustainable. The College recognizes
and appreciates that with the support of this Subcommittee the
House passed legislation under the CHAMP Act to reverse this
10.1 percent cut in Medicare payments scheduled to take place
January the 1st, and proposed to replace it with a .5 percent
increase in 2008 and 2009.
Unfortunately, the future of the legislation remains
uncertain. We request the House to work with your Senate
colleagues to ensure that the following elements of the CHAMP
Act are enacted into law and that these steps will lead to a
total repeal of SGR, guarantee at least 2 years of positive
updates, pay for the updates in a way that doesn't make the
problem worse in the future, and implement expanded pilots of
the medical home to facility physician-guided care
coordination. In conclusion, the College commends Chairman
Gonzalez and the members of this Committee for holding this
important hearing to shine a spotlight on how the SGR is
impacting solo and small physician practices. Medicare patients
deserve the best possible medical care, but they also deserve a
physician payment system that will help physicians deliver the
best possible care. Thank you, and I look forward to answering
your questions.
[The prepared statement of Dr. Harris may be found in the
Appendix on page 49.]
ChairmanGonzalez. Thank you very much, Dr. Harris. At this
time, for the purpose of the introduction of the next witness,
the chair is going to recognize my colleague, Congresswoman
Mary Fallin.
Ms.Fallin. Thank you, Mr. Chairman. And it is a great
pleasure to be here today to hear this important testimony. And
let me just say thank you to all of our panelists who are
providing good information for us to consider on this
legislation. I had the opportunity this week to have what is
called a tele-town hall meeting in my office and to be able to
visit with constituents back in my district. And I was
surprised to find that a large portion of my constituents in my
district were complaining about the lack of access to doctors
because of the Medicare reimbursement rate, and how they were
having a hard time finding anyone to take care of them. Now you
might expect that to happen in the rural areas, which I do have
a couple rural counties in my district, but I was actually
talking to constituents in the metropolitan area of Oklahoma
City.
So this is a very important topic I know not only for
physicians and doctors and hospitals, but also for access to
care and quality care for our constituents back in our
district. And today I am very pleased to welcome one of our
fellow Oklahomans, Dr. Melinda Allen. And she and I had the
opportunity to visit earlier this morning about some of the
things that she finds in her practices. She is a doctor in
internal medicine, and she is also chief of staff of the Ponca
City Hospital Medical Center, which has 140 beds in northern
Oklahoma. She also serves as the medical director of the Ponca
City Nursing Home, and so she coordinates and manages care for
over 70 residents of the elderly. She also serves as a
Qualified Veterans Physician, contracting with the Veterans
Administration. So I think she has well-rounded experience not
only with folks out in our community, but our seniors and our
veterans. So Doctor, we appreciate you coming today, and I am
looking forward to hearing your testimony. Welcome.
STATEMENT OF MELINDA ROTHER ALLEN, D.O. ON BEHALF OF THE
AMERICAN OSTEOPATHIC ASSOCIATION
Dr.Allen. Thank you, Congresswoman. I think my testimony
today will reflect the feelings of Dr. Harris and Dr. Fedderly.
Mr. Chairman, Ranking Member Westmoreland and members of the
Subcommittee, my name is Melinda Allen. I am an osteopathic
internal medicine physician in solo private practice in Ponca
City, Oklahoma. I am honored to be here today on behalf of the
American Osteopathic Association and the Nation's 61,000
osteopathic physicians practicing in all specialties and
subspecialties of medicine. The AOA and our members appreciate
the efforts of this Committee to raise awareness regarding the
devastating impact current Medicare reimbursement policies are
having upon beneficiary access to care and on physician
practices, especially those like mine.
Nowhere do Medicare beneficiaries experience access issues
more severely than in rural communities. These communities are
often medically underserved, as Congresswoman Fallin had said,
and are home to seniors who will enter my practice with
multiple conditions due to lack of care. Sadly, many seniors in
these areas find the physicians serving in these communities
have no room in their practices for new Medicare patients. Upon
graduation from medical school, there were multiple
opportunities presented to me. Although taking a position with
a hospital or in a private practice in a larger city would have
allowed much more financial stability, I was determined to
return to my roots in rural Oklahoma. A partner and I opened
Internal Medicine Associates in Ponca City in June of 2002. We
purchased a small building and renovated it for use as a
medical practice. But despite our best efforts, my partner
could not support his family, manage his medical school debt,
and sustain his portion of the practice. Just 18 months after
opening our practice, he filed for bankruptcy and left Ponca
City, leaving me with a practice and a staff to support. In my
first year of practice, Medicare physician payments were cut
5.4 percent. While Congressional actions over the past 5 years
to avert additional cuts are greatly appreciated, I operate
today at approximately the same level of compensation I
received when I opened my practice over 5 years ago. Unlike any
other small business, I am forced to comply with regulations
that limit my ability to recover overhead through fees. This is
an impossible way to sustain any business. As a result, in
2006, I reluctantly curtailed my participation in the Medicare
program. But since that time I estimate that I turn away about
six to eight Medicare beneficiaries every day that call my
office looking for new physicians. However I do accept new
Medicare payments through attrition, my patients are getting
older, through hospital admissions, and nursing home
admissions. I see approximately 5,000 patients, 25 percent of
whom are enrolled in Medicare. However, Medicare beneficiary
visits total over 40 percent of my daily routine. And I
estimate that approximately 60 percent of my time is spent
caring for these 25 percent Medicare patients that I have. This
not only includes the individual visit for which I am
compensated, but also many hours of follow-up and coordination,
time for which physicians are not compensated.
I am a small business owner. I own my own building and I
employ a staff of six, one of whom really provides services
specifically to my Medicare patients. I provide my employees
with annual cost of living increases. My office is open for an
estimated 235 days per year. This allows for a week of
vacation, a week of continuing education, and 10 holidays. And
if you notice, there are no sick days. I never get sick. We are
not allowed to get sick. Generally, I average 22 to 25 patients
per day during a 60-hour work week. My estimated practice costs
in 2007 will be approximately $265,000. As evidenced by the
chart in my written statement on page five and six, I have a
flow chart of costs. If the scheduled Medicare payments cuts
are realized, sustaining my practice, which is comprised of
only 25 Medicare and 75 percent private insurance will be
impossible. By 2015, I will be operating at a $65,000 annual
loss. If I chose to see only Medicare patients over the next 5
years, I would lose $122,000 annually. These numbers indicate
the real impact that the Medicare physician payment cuts have
on a small business owner. The modest increases in annual
operational costs do not include major maintenance or repairs,
hiring new staff, investing in health information technology,
or any other challenges facing a solo practitioner. Without any
real adjustment to the system, many physicians like myself that
are called to serve in these rural communities will be unable
to do so, compounding existing health disparities, and leading
to a true access crisis for my patients. Any future Medicare
physician payment formula should provide annual positive
updates that reflect increases in practice costs for all
physicians participating in the program. Additionally, those of
us choosing to participate in pay-for-reporting programs,
implement health information technology systems, or provide
patient-centered care coordination services should receive
bonus payments above the annual payment updates for their
participation and investment. I would like to express my
gratitude to the Committee for focusing its attention on this
often overlooked segment of our nation's small business
community. I implore you to take the appropriate steps to
ensure that I can continue to serve my patients, and I look
forward to answering any questions. Thank you.
[The prepared statement of Dr. Allen may be found in the
Appendix on page 58.]
ChairmanGonzalez. Thank you very much, Dr. Allen. Our next
witness is Dr. Kenneth L. Noller. Dr. Noller is testifying here
today on behalf the Alliance of Specialty Medicine as well as
the American College of Obstetricians and Gynecologists. He is
currently the president of the ACOG, which has over 49,000
members, with its members representing over 90 percent of the
United States' board-certified OB-GYNs. The Alliance of
Specialty Medicine is a coalition of 11 national medical
specialty societies, representing more than 200,000 physicians.
Dr. Noller is chair of the OB-GYN department, and a professor
in the Department of Family and Community Medicine at Tufts
University in Boston, and the gynecologist and chief at Tufts
New England Medical Center. Welcome Dr. Noller, and you may
start your testimony.
STATEMENT OF KENNETH NOLLER, M.D., PRESIDENT, AMERICAN COLLEGE
OF OBSTETRICIANS AND GYNECOLOGISTS
Dr.Noller. Thank you. Mr. Chairman and members of the
Subcommittee, thank you for holding this hearing on the effect
on solo and small practitioners of the 10.1 percent Medicare
physician payment cut. It is important and appropriate that
this Subcommittee consider the impact of the cut on these small
businesses. ACOG and the Alliance appreciate the leadership of
the House Ways and Means, and the Energy and Commerce
Committees in addressing the physician payment cut in the CHAMP
Act. We strongly support a 2-year reprieve from payment cuts,
and look forward to a permanent solution to this crippling
problem. We urge Senate action to end the uncertainty facing
small medical practices. These practices remain the backbone of
the U.S. health care system, but financial and regulatory
burdens are making it hard for these practices to stay open.
For example, OB-GYNs in solo practice fell from 34 percent in
1991 to 23 percent today. Often this means that a small
community lost its local doctor. Patients must now travel
farther to see an OB-GYN, or they may receive no medical care
at all. If Congress does not enact a long-term solution soon,
physicians serving Medicare patients will see cuts year after
year, eventually totaling 40 percent. No small business can
remain solvent with such drastic reductions in its revenues,
while at the same time office rent, salary increases, medical
supplies, medical liability insurance costs all increase.
Medicare cut payments in 2002, increased them less than
inflation in 2003, 4 and 5, and froze payments in 2006 and 7.
Is it any wonder that more and more physicians will no longer
see Medicare patients? Under today's flawed formula that
determines Medicare physician payments, the payments are tied
to gross domestic product instead of the cost of providing
medical care.
Physicians are penalized for skyrocketing increases in the
costs of in-office prescription drugs, and physicians are
required to offer services that are beyond their control. These
include such things as new benefits authorized by legislation,
increased regulation, new technology, and growing patient
demand. The bottom line is that Medicare cuts cause patient
access problems and hurt patients throughout the health care
system.
Here are four examples: Elderly patients in fee-for-service
Medicaid are the first to lose their doctors as physicians are
forced to restrict the number of new beneficiaries they can
see. Secondly, TRICARE, the health care system for our military
families, uses the Medicare fee schedule, thus diminishing
access for these families. Thirdly, many private insurers
follow Medicare's lead, cutting or freezing physician payments.
And lastly, as Medicare and private insurance payments decline,
practices often have to make the hard choice to stop caring for
patients of their lowest payer, Medicaid, creating access
problems for those patients.
Community clinics serving low-income patients have
difficulty recruiting physicians, and have to cut back on care.
These cuts will be felt by rural areas first. The loss of even
one small practice in a rural area means that patients must
travel further for routine care, and further still if they need
specialty care. And recruiting physicians to rural areas has
become very difficult, if not impossible. It is simply too
risky for a young physician with 150 or $200,000 in debt to
open a practice in these areas. Falling and unpredictable
payment rates also make it very difficult for small practices
to buy expensive new technology such as HIT, even though such
systems can probably improve patient safety.
Dr.Noller. A few of us entered medicine to become
businessmen, we entered medicine to care for our patients, but
no matter your business sense, it is clear the payment cuts of
10 percent in 2008 and a total of 40 percent over the next
decade will make it impossible for the private practice of
medicine to survive.
As advocates for patients and physicians, ACOG and the
Alliance of Specialty Medicine applaud the House for acting to
prevent these cuts. We call on the Senate to do the same and
very much appreciate your leadership in continuing to highlight
this critically important issue. I thank you.
ChairmanGonzalez. Thank you very much, Doctor.
[The prepared statement of Dr. Noller may be found in the
Appendix on page 74.]
ChairmanGonzalez. I am going to recognize the Ranking
Member Mr. Westmoreland for the purpose of introducing the next
witness.
Mr.Westmoreland. Thank you, Mr. Chairman.
Before I introduce Dr. Whitlow, I want to recognize Tom
Spatonik from Georgia also who made the trip up here.
Mr. Chairman, it is my pleasure to introduce my
constituent, Dr. John Whitlow, who serves as president of the
Georgia Optometric Association. Dr. Whitlow also practices at
the West Georgia Vision Center, which he and his wife, Dr.
Donna Whitlow, founded in 1993, a true small business, mom-and-
pop operation. An active member of his professional
association, Dr. Whitlow has held several leadership positions
with the Georgia Optometric Association.
In the legislative arena he has worked to promote insurance
for quality, and in 2001 received the GOA Legislative Service
Award for his efforts. Dr. Whitlow has been a member of the
Troup County Chamber of Commerce for 14 years. He has been an
effective member of the LaGrange community.
I thank Dr. Whitlow for his willingness to share his
thoughts and look forward, as I am sure we all do, in hearing
his testimony.
STATEMENT OF JOHN WHITLOW, ON BEHALF OF THE AMERICAN OPTOMETRIC
ASSOCIATION
Dr.Whitlow. Thank you. Good afternoon. Thank you, Ranking
Member Westmoreland for those kind words.
As he said, my name is John Whitlow, president of the
Georgia Optometric Association and a doctor of optometry from
LaGrange, Georgia.
It is an honor to represent the American Optometric
Association and its 34,000 doctors this afternoon. We
appreciate the opportunity to provide the House Small Business
Subcommittee on Regulations, Healthcare and Trade with our
views and recommendations concerning the current state of
Medicare payments to physicians, especially doctors of
optometry and other health care providers.
As a small business owner of a private optometric practice,
and, again, as Ranking Member Westmoreland alluded to, truly a
small business, most days I am the doctor there; a lot of days
I am the office manager; then there are days where I am the
plumber; then there are days that I am the electrician; and
then there are days that I am even the dish washer. So it is a
truly small, small practice.
But it is my pleasure to testify before you today regarding
the disheartening effect that Medicare reimbursement is having
on efficient and high-quality health care, including the
delivery of eye and vision care that I provide to over 1,200
Medicare patients that I see personally.
The SGR formula currently used to determine Medicare
payments is producing dire results for all health care
providers, especially those in the small and rural communities.
As the primary eye care providers in over 6,500 communities
across this Nation, my colleagues and I are very well aware of
the many obstacles that health care providers face as they
strive to provide care to an ever-increasing number of Medicare
patients. Access to quality care is increasingly at risk
because of the strains on the current system that threaten the
ability of providers to deliver needed care.
We are often the only eye care providers available in the
rural communities and underserved areas and, like other
providers, are struggling to serve America's children,
America's seniors, and America's underserved while keeping pace
with the standard of care and rising costs.
When reimbursement rates are pegged at artificially low
levels that do not reflect genuine practice costs, patient
access suffers because clinicians will be financially unable to
serve many patients.
The impact of Medicare physician payment cuts affects the
entire health care community, including the non-MD/DO
community. PARCA, a coalition of organizations representing the
interest of millions of patients and clinicians, applauds the
efforts put forth by Members of Congress and the congressional
staff as they work to address Medicare payment reform. PARCA
supports congressional efforts to bring forward legislation
that will provide multiyear positive updates to bring stability
to the Medicare payment system.
The American Optometric Association in concert with other
health care provider organizations asserts that the SGR payment
formula has produced disastrous results for both doctors and
the patients. None of the factors in the SGR take into account
Medicare spending due to technological advances or where
utilization has increased because of new Medicare coverage
policies and expanding preventive services.
The AOA gratefully acknowledges the recent efforts by
Congress to provide some temporary fixes; however, a permanent
solution must be found and is needed to resolve a full-blown
meltdown of the Medicare system that looms on the horizon. The
AOA urges the Subcommittee and Congress to work with the CMS to
avert future cuts by enacting a system that produces rational
health care provider payments and accurately reflects increases
in practice costs. The SGR should be repealed and replaced with
a payment update system that reflects these increases in
practice costs.
Congress must at the very least first establish some sort
of transition, some sort of pathway to allow us to have the
complete elimination of the SGR; and second, to stabilize
payments in the short term for a minimum of 2 years by
providing positive baseline updates to all health care
providers consistent with the Medicare Payment Advisory
Commission's recommendation. A scheduled cut of 10 percent in
2008 should be replaced with an increase of 1.7.
As a small business owner of a private practice, I, along
with the AOA, appreciate the opportunity to provide our views
to the Subcommittee on these critical matters. We look forward
to working with the Small Business Committee and Congress to
pass immediate legislation that preserves access, averts the
next 2 years of payment cuts, and provides a positive update
that reflects optometric practice costs. Thank you.
ChairmanGonzalez. Dr. Whitlow, thank you very much.
[The prepared statement of Dr. Whitlow may be found in the
Appendix on page 79.]
ChairmanGonzalez. It is the Chair's intention to get at
least one round of questions. The Members will be restricted to
5 minutes. Taking into account the Ranking Member's schedule
this afternoon, because I am afraid we will go and vote, he may
not be able to make it back or stay very long if we do, I am
going to defer to the Ranking Member in allowing him to pose
his questions at this time.
Mr.Westmoreland. Thank you, Mr. Chairman.
Dr. Harris, you mentioned the CHAMP Act and 5 percent
increase in the reimbursement. That was just a temporary fix,
though, correct? That did not deal with the real problem of the
SGR.
Dr.Harris. No. The CHAMP Act, as you know, is a new
proposal. What we would much prefer is for the CHAMP Act to
avert the cut and impose these positive updates, but even then
that it is only for 2 years, and we are back to where we
started.
Mr.Westmoreland. It would be better in the long run to go
ahead and let us get this thing worked out, and suffer whatever
we are going to suffer now and fix it. It is like Dr. Burgess
said, it will only continue to get more and more expensive the
further down the road we get.
Dr.Harris. It is. And it is hard to exaggerate the
magnitude of the effect of this. It is devastating to small
practices.
If I just interject, I am absolutely persuaded that SGR was
a major factor in something which I experienced last July. Our
practice, 40 years old, imploded. It is over with. We had
started--I was a nephrologist/internist with another internist,
and we practiced for about three decades. Along the way we
added another nephrologist, who eventually, a very bright guy,
after about 18 years returned to teaching at Chapel Hill. We
went on to add other young internists who were comfortable, but
we began encountering these pressures where it was so difficult
with a 60 percent overhead.
We brought specialists, consultants in on two occasions who
told us exactly the same thing: Our overhead was the best we
could do. And our choices were simply leave the hospital
earlier in the morning after rounds to get there, stay in the
office longer, and make evening rounds later, or see more
patients per unit time. And we did that as fast as we could,
but it still didn't spare us.
We finally added a young woman, a very bright young woman,
from the University of Virginia who joined us. But most medical
school classes now are 50 percent women and, like most young
people, would like to also start their families. So this young
woman knew that, and she knew it would mean working part time.
But if you think it is difficult to practice under these
circumstances full time, it is terribly difficult part time,
and so we lost her. Virginia offered her a part-time job at an
outpatient community.
We have since then had a terrible time attracting new young
internists now because they can go and become hospitalists,
inpatient physicians. It pays 16 percent more. All of this
effect makes it terribly difficult at a time when the Nation
needs more primary care physicians. And the SGR bears a
tremendous responsibility for this current situation.
Mr.Westmoreland. Dr. Whitlow, following up on that, in your
written testimony you indicate that access to care may be
jeopardized by the current Medicare payments, that they don't
meet the practice costs. Can you elaborate on that access
problem we are going to inherit, and how far down the road do
you see this getting to a critical stage if it is not already
there?
Dr.Whitlow. Well, in any private practice, especially when
you start looking at being basically a primary care frontline
physician, looking at new technology that is coming out,
looking at when you have that technology, a lot of times
needing to ask staff people to help you with that technology,
looking on further down the road with electronic health records
that is also looming there, all of these things start adding up
into costs that somehow has to be absorbed into the practice.
And with that comes your decision whether you can accept
payment. When I say accept payment, as far as with an insurance
company, and, of course, talking about Medicare, whether
Medicare is paying us enough to accept that.
But taking that even a step further, being on the front
line, I may have a patient that I see because I am accepting
the insurance, but I may need to refer that patient to a
secondary or even a tertiary care doctor, and it is getting
more difficult to find a doctor to refer the patient to.
One of the examples that keeps running through my mind
right at this moment, what is happening with Medicaid right now
in the State of Georgia is basically, I think, a precursor to
what I see that is happening with Medicare now. They have just
constantly cut fees and produced more red tape for doctors to
not only accept the patient, but then even filing the claims,
more and more red tape so it gets more cumbersome.
To make it short, these doctors are dropping out of the
Medicare system. So I may have a patient that needs care, and
it is getting extremely difficult to find the doctor to refer
that patient to, and especially somebody that is fairly local,
without a patient driving 50, 60, 70 miles to have to do that,
because, again, when you start talking about Medicare, we are
speaking mostly about the elderly patients of our Nation.
Mr.Westmoreland. Yes, sir.
Let me just ask, if I could, a quick question. I know Dr.
Allen mentioned that she has limited her Medicare patients. In
your practices, do you limit your Medicare patients, and if you
do, what percentage would that be?
Dr.Fedderly. I currently do not limit my Medicare patients
in my practice.
Dr.Harris. Since beginning this role with American College,
I have slowed down appreciably in the last year, but my former
partners, I believe they do limit it. I don't know the
percentage.
Dr.Noller. We do not limit it at this time.
Dr.Whitlow. Not yet.
Mr.Westmoreland. Okay. Thank you very much.
ChairmanGonzalez. You noticed that the bells have gone, and
we have another vote. We are within 5 minutes, but what I would
like to do, because I am not real sure about other Members'
schedules--m definitely coming back, so I will again ask for
your patience and indulgence because I have some questions.
Congresswoman Fallin, if you would like to pose your
question, just if you have something that you feel we need to
put out there? Even if we can't take the complete response, I
want to give you that opportunity.
Ms.Fallin. Thank you, Mr. Chairman.
As I mentioned, I had the opportunity to visit with Dr.
Allen beforehand, and one of the things I was concerned about
that she expressed to me was the time with the rules, the
regulations, the systems, the expenses that doctors have to buy
to try to manage their practice, and their access to care, and
their quality of care for their patients. But she told me that
she receives about 60 phone calls by noon a day from various
patients trying to just talk about an illness, or schedule an
appointment, or calling in about a prescription, just the
amount of time.
We were talking about how if that was an attorney, that if
she talked to them for 5 minutes, she would be paying probably
150 or $200 an hour. But the doctors don't get paid for their
phone call time.
We talk about access to care and being able to see lower-
paid patients. It is hard for the doctors, it seems, to be able
to make the income that they need to make while they are
investing in the intellectual properties that they need to have
for their practices. So we were visiting about a nationwide
system to where they could share information about their
patients and their records.
So I guess my comments are I hope we can continue to work
on this issue and see what we can do to help create better
access to care.
Dr.Allen. And as a comment, we have been looking at adding
electronic medical records to systems to our office. There are
400 systems out there. How do I know that the one that I pick
will be the one that is chosen several years down?
ChairmanGonzalez. Dr. Allen, we will be able to enlighten
you on that, because we do have something. We will stand in
recess so I make sure I don't have my colleagues missing votes,
and I shall return. If they can make it back, they will be
back, and we may be joined by other Members, but we definitely
will resume. We stand in recess.
[Recess.]
ChairmanGonzalez. Thank you very much. We will reconvene
the hearing. Obviously I want to get more than 5 minutes, so I
appreciate it very much.
First of all, I need to express the regrets of Congressman
Westmoreland. He has to be at another hearing. The hearing that
he will be attending deals with the drought, and I think, Dr.
Whitlow, you know exactly the circumstances there and why he is
needed at that hearing.
I am going to start off with general observations. As
Republicans, Democrats, we all try to come up with some answer
to this. The bottom line will always be how we pay for it, and
there will be a disagreement on how we pay for things. But I
think everyone acknowledges a few things; maybe we can all
agree on something. It will cost more in all probability, but
if we do it right, we can save money down the road and make up
for some of that cost, and I am going to touch on that. But it
is interesting if we could agree on some things.
I am going to request this, and I say this to all my
doctors and to all the specialists in the group, and I see some
of the representatives out there, is for the medical profession
to try to get on the same page on the overall approach. Dr.
Burgess's approach, obviously you wouldn't really have a
replacement of the SGR for a period of 2 years. Well, believe
it or not, I heard from a lot of doctors and a couple of
associations that it was not sufficient or adequate. They
wanted an immediate fix. So we need to make a determination,
one, do we bridge or transition into it? Some of you have
already indicated we probably should, and maybe have 2 years as
we go into it with some predictability so that you know you
will be reimbursed, and it keeps up with inflation and so on.
The next thing I think we should all agree on is if we
index reimbursement rates, they have to reflect the increased
cost of providing the service, which SGR is pretty blind to.
That is fundamental, so that is one thing.
What we replace it with is probably more difficult, but I
think we are getting into some areas where maybe we can reach
greater agreement on this, too, and that is managing disease. I
know that it has been approached, and I want to make sure that
I get the exact description of it, and that is how you have a
center of care or a health care home, more or less, which is
very important, and which will be accommodated, and then we get
into the next issue of health information technology.
I will ask Dr. Fedderly and Dr. Harris, when you describe
this to me, it sounds like managing disease, making sure you
keep track of the patient and so on. So there's a lot of
prevention. And if I had my notes a little more clearly, I
could tell you exactly how each of you described it, but I
think both of you may have used a centered or home, to that
effect. Is that akin to what Secretary Leavitt has been talking
about in the way of pay for performance? And how does it fit in
to what has been proposed, this pay for performance?
I will start with Dr. Fedderly.
Dr.Fedderly. Thank you.
It is part of that. Pay for performance is part of the
patient-centered medical home, and the idea is that if the care
is more efficient and better provided, and if people are kept
healthier, then that is a better performance marker, so there
is compensation in the form of better performance and for
better quality of care provided to our patients.
The patient-centered medical home idea is that a patient
will have a central location or one place, first call shopping,
if you will, to know where to go to deal with particular
issues. So it is not only a preventive health care mechanism,
but if a person feels ill, she or he knows where to go to
obtain their medical care. And if the physicians in their
medical home can't provide that care, then they certainly know
where that care will be best obtained.
ChairmanGonzalez. Dr. Harris?
Dr.Harris. I think the key phrase is patient--
ChairmanGonzalez. I am sorry, go ahead.
Dr.Harris. The key phrase is "patient-centered." When you
ask patients what they want, they obviously want access to a
physician. Two, they would like someone who knows them well and
longitudinally over a period of years, if not decades. And they
want to be able to access them easily, perhaps by phone or e-
mail in addition to office visits. This patient-centered
medical home is built around that.
The notion is that the physician also accepts
responsibility for helping patients navigate a very complex
health care system, whether it is getting them to a
subspecialist or helping them communicate between what happens
in and out of hospitals or to and from nursing homes. It is all
united by a health information technology so there is a smooth
connection, and everyone knows what is going on in that
patient's medical life, and it is done appropriately, but all
while treating preventive care, acute and chronic care and end-
of-life care.
We believe that there are a number of payment mechanisms
that will make it happen, one of which is pay for performance.
The college believes that paying for quality, tracking quality
is a healthy thing to do, beginning with pay for reporting, but
ultimately with pay for performance.
We believe that there are three other pieces, though, that
go with pay for performance. One is a fee for helping overcome
this enormous cost of the health information technology, about
30- to $50,000 per doctor. Two is a fee for coordinating the
care, when you are managing all the people that it is going to
take to make this work successfully. And lastly is the
traditional fee-for-service system.
ChairmanGonzalez. Doctor, to all of you in a minute I am
going to ask you the question in your practice--and some of you
may have responded already, but I want to take a roll on it--if
you utilized health information technology. And I know
electronic health records, on the Hill we call it HIT, and
there are proposals out there. Obviously Dr. Gingrey and I have
introduced a piece of legislation that would assist the
physicians, and it will be the small practices by way of the
tax treatment, of course, but that will not be enough, so we go
into grants, but that would be limited. So we go into loans,
which obviously would be subsidized, which would be of some
assistance, but also has a Medicare payment aspect to it where
you are rewarded, in essence, for it. So we will see where that
goes. We are attempting to do that.
My concern is, of course, it may be easier for larger
entities to do this, such as the HMOs and so on. I am just real
concerned about the small business application, and not to
leave you out of that equation, because I think in the future
it would put you at a real disadvantage.
I will just go down the road and just ask do you utilize
health information technology, electronic health records? Dr.
Fedderly.
Dr.Fedderly. Yes, we use electronic technology. And your
comments are right on target in terms of the need for small
businesses to be able to afford this, because it is fairly
certain that large businesses can afford it and can have the
staff and infrastructure to keep it up and running, but it is
the small businesses that are going to have the greatest deal
of difficulty handling this. So that would be a very good key
to your suggestion.
ChairmanGonzalez. Dr. Harris, do you utilize it?
Dr.Harris. As I mentioned before, in the last year I have
been involved with a college almost full time, but, yes, the
individuals with whom I--they are subsequently involved in
other practices, but they are all converting to an electronic
medical record. It is terribly expensive and a steep learning
curve.
ChairmanGonzalez. Dr. Allen.
Dr.Allen. Yes, I am familiar with them at the hospital. I
use the CPR system that the Veterans Administration gives, but
I do not have a system in place in my office for my patients,
and the reason is simply because there are 400 systems out
there. How do I know that the one that I pick won't be the DOS
that is now outdated 5 years from now? How do I know that the
system I pick will coordinate with my pharmacies and my
hospital?
It doesn't do any good for each one of us to have a
different system that doesn't talk to each other. We definitely
need some forward movement on this, especially from Congress,
at helping us select a system, helping a system come to the
forefront so that when we make that investment, that investment
is sound and will be with us 10 or 20 years from now, and then
my patients will also benefit from one system. Again, it
doesn't help if the cardiologist across town does not
coordinate with my system, or my pharmacy doesn't, or my
hospital doesn't.
ChairmanGonzalez. There is some good news. I believe it is
good news.
Dr. Noller.
Dr.Noller. Yes. Our biggest concern is the same as Dr.
Allen, is that the system that we have now are going to be not
the one that is chosen nationally, not the one that is going to
interface with others. In the city of Boston, there must be 100
different systems, and when a patient moves from one doctor's
office to another, that electronic record won't fit in that
computer. So even if she takes the disk with her, it doesn't
work in the other system. So coordination is a big one.
ChairmanGonzalez. And Dr. Whitlow.
Dr.Whitlow. We are presently looking at it. We do not use
it now for some of the reasons that have been mentioned as far
as waiting to see what is coming on the horizon as far as which
one could we choose. The other has been the cost issue.
The other issue is going back to the learning curve that
Dr. Harris referred to. A lot of the practitioners that are on
my level are saying that they have to decrease the number of
patients that they are seeing per day in order to get the
records entered properly; either that, or you are going to have
to hire more staff. It is not only the start-up cost, but
getting the whole process going.
ChairmanGonzalez. The news is, of course, as we try to
introduce a system where we assist you--and that is going to be
the carrot, of course, because there will probably be a penalty
if you don't down the road. I really believe that is going to
happen. So I think the medical profession needs to be prepared.
We owe you a responsibility, Dr. Allen and others, to make sure
whatever you utilize will obviously not be outmoded or outdated
and so on.
So there will be conditions. There will be criteria. We
have someone at HHS who is putting it all together, but
definitely there will be a certification process, and so that
we do have interoperability and so on. We will not leave you
hanging out there with old systems, because it is going to cost
the Federal Government money then.
We are hoping that by assisting you, how does this all play
in? Well, you know, we get back to the SGR, and it will be part
of whatever we replace it with is going to have, in my opinion,
HIT components. So we need to be ready for that, and with good
reason. You need to survive in the modern world and the
competition that awaits anybody who doesn't make that
particular transition.
The other thing that I wish the medical profession would
just get out there and somehow help Congress with the news that
we have to find streams of revenue to finance some of this.
Dr. Harris, I think you probably mentioned the CHAMP Act
more than anybody else, but, you know, we were paying for that
out of the House with a decreasing payment to the Medicare
Advantage. We just met a firestorm, decrease in payments on
some imaging from the radiologists. And, of course, just tax on
cigarettes, we are still running into problems with that. And
that is all we are doing now is a reduced package financed by
cigarette tax. But we have the administration that now is
coming up and saying that is a tax increase, and we will not
approve a tax increase. We could have a veto of the SCHIP bill,
which no longer has the 10 percent reduction fix or any of
that.
But you really do have to let your Member of Congress know
that you understand that it will not be free, and we have to
pay for it somehow. All the choices are bad, but some are worse
than others. And so the cigarette tax seemed like the least
doing harm to the greatest number of American citizens and
taxpayers. Of course, Medicare Advantage didn't appreciate it
much, but I think there was some room for improvement on the
payment that we made to them to deliver their particular
service.
The last question I will leave you with before we adjourn
and conclude the hearing, we hear that doctors are taking fewer
Medicare patients, some are not, but we have conflicting news
or reports. On one hand, I know I have constituents who are
saying they are making those 30 phone calls, trying to find
someone to take them. That is the reality. And yet we have
studies that show that accessibility by Medicare beneficiaries
to physicians is not really being impacted, and that there is
still sufficient, maybe even an increasing number of physicians
available to Medicare recipients. So we are getting kind of
cross messages. I am not sure. Maybe it depends where you live.
If it is a metropolitan area or a rural area, it may be that
takes care of some of the figures. But if you all have any
opinions as to why we are getting conflicting messages on the
availability of physicians.
The last observation I have is, Dr. Allen, you pointed out
something so important. You did reduce your patient load of
Medicare beneficiaries. You still accepted those that come
through your church or other referrals, but they still
represented more than 40 percent of your practice, of your time
that you spend, and that should be an easy conclusion to reach
because it is an older population. But I don't think we really
think of that. We may say, this is your percentage of Medicare
patients, but it is an inordinate amount of time and service
that you are providing them. So I thank you very much for
bringing it up.
The last question, though, is the conflicting messages that
we are getting. Is there any explanation, in your opinion,
whether we really are suffering a decrease in the number of
doctors treating the Medicare patients? And we will just go in
order.
Dr.Fedderly. The reason you are getting a conflicting
message is because it is by virtue of what we do as physicians.
We have trouble saying no, and we--oftentimes by the time you
are forced, like Dr. Allen is forced, to restrict her Medicare
patient load, you are often far beyond the desperate measure.
I think that the best description is that especially as
primary care physicians, we feel like we are hamsters on the
wheel, and we are making the wheel go faster and faster and
faster to try to accommodate everybody. Where this system will
break down is in the quality of care that is provided, so that
if I see 25 patients in a day, but in turn I am accepting more
Medicare patients, then I am going to try to squeeze in 30, 32,
34 and think about how the individual Medicare beneficiaries
then are going to get less of my face, less of my time, less of
my ability to coordinate the multiple issues they have.
Now, if I have more of my practice in healthy young people
that don't require a lot of care and a lot of coordination,
sometimes you can make that happen. But as the baby boomer
population is aging and hitting Medicare age, there are more
and more of them out there, and there is fewer and fewer
doctors, yet there's not that many doctors who are willing to
say no. We are just doing our best to try to make the wheel
spin.
ChairmanGonzalez. I always say you are the last standing
profession in the United States.
I am going to apologize to the remaining witness. That
question is out there for your response. Julie Hart, to my
left, is my medical issues individual, if you could provide her
with that information as to the conflict. I think it is very
important; quantity versus quality is so important. At this
time, and again with my apologies, I cannot miss this vote.
I ask unanimous consent that the members of the Committee
have 5 legislative days to enter statements and supporting
materials into the record, and, without objection, it is so
ordered.
ChairmanGonzalez. This hearing at this time is adjourned.
Thank you very much.
[Whereupon, at 1:40 p.m., the Subcommittee was adjourned.]
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