FY 2008 Funding for Title VII Geriatrics Programs, Increased Medicare Reimbursement Rates, AMA Lobbies to Block Medicare Cut, Ov

House and Senate Consider Spending Measure That Would Guarantee Funding for Title VII Geriatrics Health Professions Programs in FY 2008

Title VII Geriatrics Health Professions Programs would receive $31.5 million in federal funding in fiscal year (FY) 2008 under a proposed measure the House and Senate were considering as this issue of Annals of Long-Term Care went to press in early July. Legislators included funds for the programs in the spending measure following an AGS Health in Aging Advocacy Center campaign on behalf of continued funding. If approved, the measure would guarantee that the programs are funded at their current level in FY 2008, which begins October 1.

Congress eliminated all funds for Title VII Geriatrics Health Professions Programs--geriatric faculty fellowships, the geriatric academic career awards program, and the nation's Geriatric Education Centers--in FY 2006. AGS and Association of Directors of Geriatric Academic Programs (ADGAP) members, and the AGS, in coalition with other organizations, immediately launched campaigns urging restoration of funding. Congress restored funds for the programs this February, earmarking $31.5 million for the remainder of FY 2007. Since February, AGS staff and the Society’s Washington, DC, consultants, WolfBlock Public Strategies, have continued to educate Congress and Congressional staff about the critical importance of Title VII Geriatrics Health Professions funding in an effort to keep these much needed dollars in the FY 2008 budget.

Many thanks to the AGS and ADGAP members and other supporters of quality healthcare for older adults who have joined Health in Aging Advocacy Center campaigns on behalf of funding for these programs. Your involvement was and will continue to be crucial. The budget process is still in its early stages, and AGS plans to launch additional campaigns on behalf of the programs in the near future. If you haven't yet done so, please visit the advocacy center, www.americangeriatrics.org/advocacy, and join these and other efforts aimed at ensuring older Americans access to quality healthcare.

Increased Medicare Outlays for Physician Services Are Mainly the Result of Increased Volume and Intensity of Services, Rather than Reimbursement Rate Changes, Report Finds

Increases in Medicare spending for physician services has largely been due to increased volume and intensity of these services, rather than to changes in physician reimbursement rates, according to a recent Congressional Budget Office (CBO) report.

Medicare reimbursement rates have fluctuated since 1998, when Medicare adopted the Sustainable Growth Rate (SGR) formula, which mandates cuts in physicians' payment rates when increases in expenditures for physicians' services outpace growth in gross domestic product. (See related story below.) Between 1997 and 2005, Medicare spending on physician services rose 79.2%, the report notes. After adjusting for changes in the cost of providing these services and for growth in the number of Medicare beneficiaries, however, spending on physicians' services increased just 34.5% during that period. This growth, the report concludes, "is explained by growth in the volume and intensity of physicians' services rather than by changes in Medicare's payment rates."

"In fact, the quantity of services that physicians provided during that period increased by slightly more--39.4%--than did Medicare's per-beneficiary spending on physician services," the report notes. After increased costs of providing care are taken into account, "Medicare's payment rates for such services actually declined slightly during that period," the CBO report concludes.

AMA Launches Campaign to Block Cut in Medicare Payments to Providers, Releases Survey Finding that Many Docs Will See Fewer Medicare Beneficiaries Should Cut Go Through

The American Medical Association (AMA) has launched a $2 million lobbying campaign to convince Congress to block a scheduled 10% cut in Medicare payments to physicians that's slated to take effect January 1. The AGS and other organizations have joined the AMA in these efforts. The scheduled cut is mandated by Medicare’s controversial Sustainable Growth Rate (SGR) formula, which requires such rollbacks when increases in spending for these services exceed growth in gross domestic product. (See related story above)

At the same time, the AMA released the results of a survey of 9000 doctors that found nearly one- half--45%--would limit the number of new Medicare patients they see if the cut takes effect.

The AMA is advocating for a 1.7% increase in payments to providers in 2008, as recommended by the Medicare Payment Advisory Commission in a March report to Congress. In addition, the AMA is urging Congress to eliminate the SGR. Legislators have blocked SGR-mandated cuts each year since 2002. Because the formula remains in place, however, Congressional action preventing the cuts one year sets the stage for larger SGR-mandated cuts in subsequent years. The AMA estimates that future SGR adjustments will amount to a 40% payment cut for providers over the next nine years. During that same period, doctors expect their practice expenses to rise about 20%.

According to the AMA, a reduction in payments to private Medicare Advantage plans, which are currently 12% higher than payments for traditional Medicare, can provide extra funds for physician reimbursement.

During Hearing, Legislators and Experts Express Support for Public-Private Entity Overseeing Research Into Comparative Effectiveness of Medical Treatments

Establishing a public-private entity that would oversee research to determine which treatment approaches are most effective would help improve healthcare and control spending, legislators and witnesses agreed during a recent House Ways and Means Health Subcommittee hearing.

"Getting reliable, unbiased comparative information is our best shot at controlling health spending while improving care and access," said subcommittee Chair Rep. Pete Stark (D-CA), who emphasized that while such an effort should be led by the government, it must be "free from both industry and political influence."

"While we have agencies like the FDA to determine if drugs and devices are safe, we have very little information that compares the actual effectiveness of drugs, devices and medical procedures," the subcommittee's top Republican member, Rep. Dave Camp (R-MI), added, voicing support for more research to determine the most effective treatments for given conditions.

To make such determinations, however, the public-private panel would first have to "generate new findings for a substantial number of medical conditions--which would take many years," according to CBO Director Peter Orszag.

Much of the discussion during the hearing concerned the possible structure and funding of a new entity overseeing this research. Mark Miller, executive director of the Medicare Payment Advisory Commission, argued that the new entity need not be a "bricks and mortar" agency but, rather, might be an independent board that would set the research agenda while working with existing public and private research programs and providing additional funding.