Eyeing the Legislative Landscape for 2006
January 2006
A ccording to some American Academy of Dermatology Association (AADA) insiders, much of the legislative focus in 2006 will be about money — getting as much of it as possible for skin disease research, curbing skyrocketing premiums by limiting medical malpractice liability, and implementing a fix for the flawed sustainable growth rate formula that threatens to reduce Medicare payments to physicians by about 26% over the next 6 years.
But discussion topics will also reflect the importance of effective communication on issues that affect the AADA’s membership, as in the Academy’s partially successful efforts to make the iPledge program for isotretinoin more user-friendly for both patients and physicians, and the Academy’s scaling back of industry-sponsored residencies after becoming aware of its members’ objections.
Medical Liability Reform and Beyond
Medical liability reform that places a cap on economic damages to harmed patients serves the best interests of patients as well as physicians, maintains dermatologist Susan Taylor, M.D., who is a member of the coalition of Doctors for Medical Liability Reform (DLMR).
Yet despite U.S. House of Represen-tatives passage of a bill capping such damages at $250,000, the Senate has yet to approve its version of that bill.
High malpractice premiums, claims Dr. Taylor, pose a threat to the AADA’s “highest priority” — patient safety. She adds, “We want patients in our specialty and other specialties to have access to the finest medical care available.”
Such access, she suggests, is threatened in states that have escalating premiums that could prompt physicians to relocate or stop providing high-risk procedures to patients.
The effort to make both physicians and their patients aware of how escalating medical liability premiums can affect the practice of medicine and patient care is currently spearheaded by DLMR, a coalition of 10 medical specialty groups, including the AADA. In the face of the current Congressional stalemate, DLMR has intensified its lobbying efforts and aimed a public awareness campaign squarely at states considered to be in crisis.
Dr. Taylor says physician outreach efforts are aimed at all doctors, not just those in high-risk specialties. “All specialties are impacted — including dermatology.”
She stresses the importance of arriving at a solution that is fair to both physicians and patients, placing an especially fine point on the distinction between patients’ rights to recover damages and the size of such awards in recent years.
“It’s important that we stabilize the medical liability market, but we also want to make sure that patients who are injured are fairly and quickly compensated for any damages. What we want to end is medical lawsuit abuse,” she insists.
DMLR continues to lobby for support of the $250,000 cap specified in H.R. 5, the HEALTH Act of 2005. However, its main objective is placing a limit on non-economic damages awarded in medical malpractice lawsuits.
The specific amount of that cap, she suggests, is negotiable. “I think that having a cap — whatever it is — is preferable to the situation we have now.”
Dr. Taylor says the Academy also supports congressional consideration of alternative approaches to medical liability reform, such as the National Medical Error Disclosure and Compensation (MEDiC) Act, S. 1784, which encourages practitioners to apologize to patients and their families when a medical error has occurred and promotes early offers of compensation.
Can AADA Help Fix the Medicare Payment Formula?
Unless something is done to correct the sustainable growth rate (SGR) formula that determines Medicare payments to physicians, re-imbursements may be reduced by as much as 26% over the next 6 years.
As it stands now, the Concurrent Budget Resolution, which passed in both houses of Congress, translates into a 4.4% decrease for 2006. While the Senate’s passage of a budget reconciliation package that instead resulted in a 1% increase — at least for 2006 —
is encouraging, nearly all affected by the cuts agree that it doesn’t solve the problem.
Sacramento, CA, dermatologist Margaret E. Parsons, M.D., Chair of the AADA’s Council on Government Affairs and Health Policy and Practice, is concerned.
“The legislation with the 1% fix for 1 year is not fixing the bigger picture: The SGR formula does not work now and didn’t when it was created 8 years ago mainly because it’s based on bad economics. This 1% fix is just a temporary Band-Aid,” she asserts.
What’s more, she points out, even if Congress were to pass a similar bill, without changes to the SGR formula, the pool of available Medicare funds would be sharply reduced as soon as 2007, when the proposed mandated pay for performance incentives (P4P) would further cut into Medicare funds.
“Unless something is done right now to fix the SGR formula, on Jan. 1, 2006, it will reduce payments to physicians by 4.4%,” she maintains.
Dr. Parsons is hopeful that such a last-minute solution can be reached during current talks between Centers for Medicare & Medicaid Services (CMS) and the Alliance of Specialty Medicine, which represents 13 national medical specialties, including the AADA.
Toward this end, explains Dr. Parson, the AADA, in conjunction with the Alliance of Specialty Medicine, has been meeting “aggressively” with Dr. Mark McClellan, M.D., Ph.D., Administrator of CMS, and his staff, on the main issues:
1. creating a new formula for re-imbursement based on appropriate economics
2. incorporating pay for performance (P4P) in a positive, not punitive manner.
“The complication as far as P4P goes is that we don’t know how it is going to work,” says Dr. Parsons. “Unlike some of the internal medicine specialties that have disease measures that can be more easily tracked, dermatology, like many specialties, is in the process of developing measures, but it still lacks a system that can be easily tracked and judged,” asserts Dr. Parsons. “To mandate a system that is not developed and understood with standards and measures that have been tested is completely illogical.”
Speaking for most dermatologists, Dr. Parsons insists, payment to physicians should be based on appropriate economics, such as the Medical Economic Index, and the realities of their own specialties and individual practices. And that, she says, means an SGR fix that considers physician’s actual costs and a pay for performance program based on incentives, not penalties.
The AADA and the Alliance are recommending that CMS’s initial foray into the pay for performance system be on a voluntary basis (“pay for reporting”) out of separate funds, rather than a withhold system of P4P pulled from the main Medicare funds.
Modifying the iPledge Program
Thanks to last-minute concessions based on AADA recommendations, an improved version of the iPledge pregnancy risk management program with clearer definitions and parameters went into effect on Jan. 1, 2006.
The AADA had been opposed to many aspects of the FDA-approved restricted distribution program created jointly by the four manufacturers and FDA to eliminate fetal exposure to isotretinoin (Accutane, Sotret, Amnesteem, Claravis). As it was originally approved, dermatologists considered the program to be cumbersome, confusing and generally an obstacle to compliance.
Diane Thiboutot, M.D., was among those who met with the FDA, Covance, and drug manufacturers to detail AADA concerns.
“Our objective in meeting with the manufacturers was to try to implement some of our key points,” she says. These points, she explains, ranged from seeking clarification or modification of a number of program requirements to their proposal of an initial pilot program.
After attending this meeting and receiving a letter reiterating AADA recommendations, the four manufacturers responded with identical letters. There they clarified acceptable pregnancy tests, how to handle denied prescriptions, the delegation of iPledge-related duties to staff members, and spelled out gray areas concerning off-label use of the drug. They were also more specific about how the program extends to minors, prisoners and the homeless, and they added more accurate terminology to describe exactly who is targeted by the program.
However, the manufacturers wrote, the proposed pilot testing “would not be feasible” and would “delay implementation”, and requests concerning the use of consent forms and revising the definition of an office visit were deferred: “We have, however, implemented evaluation plans and will assess the new program in an ongoing fashion to make improvements,” concluded their letter.
Dr. Thiboutot was encouraged by the progress that was made. “We didn’t get everything, but I’d say we got half of what we requested. We were able to voice our concerns to the parties involved and work with them to try to be in on providing input on how to improve the program once it’s released. As with anything new, until you really get into it, you can’t identify what all the obstacles might be.”
Skin Research Funding Increase May Add up to a Decrease
The good news for skin disease researchers is that they may receive an increase in National Institutes of Health (NIH) funds allocated via the National Institute of Arthritis and Musculoskel-etal and Skin Diseases.
The bad news, says Jouni J. Uitto, M.D., Ph.D., Chair of the AADA’s Research Committee, is that this increase at 0.7% is “abysmal”.
“When you consider inflation and the increased cost of doing research, this is in reality a reduction that will impact not only on dermatology research but also on training people in biomedical research,” claims Dr. Uitto, who is also Professor and Chair, Department of Dermatology and Cutaneous Biology, Jefferson Medical College of Thomas Jefferson University.
With the domestic portion of the federal budget flat, explains Dr. Uitto, lobbying for a larger slice of the NIH pie is harder than ever — especially now that natural disasters and the War in Iraq have further stiffened competition for scarce funds.
Such lobbying, he explains, takes place on Capitol Hill, when AADA members, in collaboration with the Society for Investigative Dermatology and the Coalition of Patient Advocacy organizations attempt to impress upon Senators the importance of biomedical research and seek the legislatures’ support in increasing NIH funds allocated to the National Institute of Arthritis and Musculoskeletal and Skin Diseases.
Dr. Uitto finds this disappointing increase especially distressing in view of the success of previous efforts. “As a result of the efforts of both the AADA and other biomedical organizations/ societies, legislators committed to supporting biomedical research were so successful in the past, within a 5-year period they were able to double funds for NIH,” he states.
“At a time when only 1 out of 10 grants applied for gets funded,” he adds, “far too much important research does not get done thanks to limited availability of funds for domestic programs.”
Dermatology Residency Support Program “Sunsetted”
Despite carefully collected and evaluated data showing a shortage of dermatologists in the United States, feedback from members has prompted the AADA to significantly scale back a program designed to fund residency grants.
The Dermatology Residency Support (DRS) Program, which funded residency grants for 10 programs starting in 2006, was to have been ongoing. However, in light of feedback from members and the circulation of a petition to propose a Bylaws Amendment on the DRS program, that program was modified to a pilot program a year ago. As it stands now, it will not be renewed after the current residents complete their 3-year stints.
AAD President Clay J. Cockerell, M.D., claims those initially involved in creating the pilot program were caught totally off-guard by a grass-roots movement not only protesting this program but proposing a bylaws amendment — to be voted on beginning at the upcoming AADA meeting in March. This amendment, he says, could preclude the AADA from becoming involved in workforce initiative issues in the future.
Dr. Cockerell says, regardless of the vote, the DRS program will be “sunsetted”. The Academy’s efforts will focus on a variety of alternatives to deliver dermatology services instead of funding residencies, including teledermatology and properly supervised physician assistants and nurse practitioners.
“For years, we had been hearing about a shortage of dermatologists, so we appointed a Workforce Initiative task force to study this issue. We approached it scientifically, using demographics and other tools,” explains Dr. Cockerell.
The Academy’s research had indicated that many areas of the country do have a shortage of dermatologists, but found that some have an oversupply.
“In hindsight, I’d say what we should have done is examine allocation — that is, how to interest dermatologists practicing in Manhattan to practice in underserved areas such as east Texas.”
So, although the AADA has already dealt with the main issue, the vote on the bylaws amendment will take place as planned beginning at the March meeting. The problem with this, explains Dr. Cockerell, lies in a provision that would forbid the Academy’s involvement in workforce initiative issues.
“We understand that the members wanted to proceed with their action and weigh in on the issue of sponsored residencies. However, as it is currently written, the AADA recommends against it because it would straightjacket the Academy from looking at workforce issues globally.”
The bottom line, he says, is that the AADA is no longer “in the business of funding residency positions.” And should that need arise in the future? “We’d wait for our membership to come to us,” he concludes.
A ccording to some American Academy of Dermatology Association (AADA) insiders, much of the legislative focus in 2006 will be about money — getting as much of it as possible for skin disease research, curbing skyrocketing premiums by limiting medical malpractice liability, and implementing a fix for the flawed sustainable growth rate formula that threatens to reduce Medicare payments to physicians by about 26% over the next 6 years.
But discussion topics will also reflect the importance of effective communication on issues that affect the AADA’s membership, as in the Academy’s partially successful efforts to make the iPledge program for isotretinoin more user-friendly for both patients and physicians, and the Academy’s scaling back of industry-sponsored residencies after becoming aware of its members’ objections.
Medical Liability Reform and Beyond
Medical liability reform that places a cap on economic damages to harmed patients serves the best interests of patients as well as physicians, maintains dermatologist Susan Taylor, M.D., who is a member of the coalition of Doctors for Medical Liability Reform (DLMR).
Yet despite U.S. House of Represen-tatives passage of a bill capping such damages at $250,000, the Senate has yet to approve its version of that bill.
High malpractice premiums, claims Dr. Taylor, pose a threat to the AADA’s “highest priority” — patient safety. She adds, “We want patients in our specialty and other specialties to have access to the finest medical care available.”
Such access, she suggests, is threatened in states that have escalating premiums that could prompt physicians to relocate or stop providing high-risk procedures to patients.
The effort to make both physicians and their patients aware of how escalating medical liability premiums can affect the practice of medicine and patient care is currently spearheaded by DLMR, a coalition of 10 medical specialty groups, including the AADA. In the face of the current Congressional stalemate, DLMR has intensified its lobbying efforts and aimed a public awareness campaign squarely at states considered to be in crisis.
Dr. Taylor says physician outreach efforts are aimed at all doctors, not just those in high-risk specialties. “All specialties are impacted — including dermatology.”
She stresses the importance of arriving at a solution that is fair to both physicians and patients, placing an especially fine point on the distinction between patients’ rights to recover damages and the size of such awards in recent years.
“It’s important that we stabilize the medical liability market, but we also want to make sure that patients who are injured are fairly and quickly compensated for any damages. What we want to end is medical lawsuit abuse,” she insists.
DMLR continues to lobby for support of the $250,000 cap specified in H.R. 5, the HEALTH Act of 2005. However, its main objective is placing a limit on non-economic damages awarded in medical malpractice lawsuits.
The specific amount of that cap, she suggests, is negotiable. “I think that having a cap — whatever it is — is preferable to the situation we have now.”
Dr. Taylor says the Academy also supports congressional consideration of alternative approaches to medical liability reform, such as the National Medical Error Disclosure and Compensation (MEDiC) Act, S. 1784, which encourages practitioners to apologize to patients and their families when a medical error has occurred and promotes early offers of compensation.
Can AADA Help Fix the Medicare Payment Formula?
Unless something is done to correct the sustainable growth rate (SGR) formula that determines Medicare payments to physicians, re-imbursements may be reduced by as much as 26% over the next 6 years.
As it stands now, the Concurrent Budget Resolution, which passed in both houses of Congress, translates into a 4.4% decrease for 2006. While the Senate’s passage of a budget reconciliation package that instead resulted in a 1% increase — at least for 2006 —
is encouraging, nearly all affected by the cuts agree that it doesn’t solve the problem.
Sacramento, CA, dermatologist Margaret E. Parsons, M.D., Chair of the AADA’s Council on Government Affairs and Health Policy and Practice, is concerned.
“The legislation with the 1% fix for 1 year is not fixing the bigger picture: The SGR formula does not work now and didn’t when it was created 8 years ago mainly because it’s based on bad economics. This 1% fix is just a temporary Band-Aid,” she asserts.
What’s more, she points out, even if Congress were to pass a similar bill, without changes to the SGR formula, the pool of available Medicare funds would be sharply reduced as soon as 2007, when the proposed mandated pay for performance incentives (P4P) would further cut into Medicare funds.
“Unless something is done right now to fix the SGR formula, on Jan. 1, 2006, it will reduce payments to physicians by 4.4%,” she maintains.
Dr. Parsons is hopeful that such a last-minute solution can be reached during current talks between Centers for Medicare & Medicaid Services (CMS) and the Alliance of Specialty Medicine, which represents 13 national medical specialties, including the AADA.
Toward this end, explains Dr. Parson, the AADA, in conjunction with the Alliance of Specialty Medicine, has been meeting “aggressively” with Dr. Mark McClellan, M.D., Ph.D., Administrator of CMS, and his staff, on the main issues:
1. creating a new formula for re-imbursement based on appropriate economics
2. incorporating pay for performance (P4P) in a positive, not punitive manner.
“The complication as far as P4P goes is that we don’t know how it is going to work,” says Dr. Parsons. “Unlike some of the internal medicine specialties that have disease measures that can be more easily tracked, dermatology, like many specialties, is in the process of developing measures, but it still lacks a system that can be easily tracked and judged,” asserts Dr. Parsons. “To mandate a system that is not developed and understood with standards and measures that have been tested is completely illogical.”
Speaking for most dermatologists, Dr. Parsons insists, payment to physicians should be based on appropriate economics, such as the Medical Economic Index, and the realities of their own specialties and individual practices. And that, she says, means an SGR fix that considers physician’s actual costs and a pay for performance program based on incentives, not penalties.
The AADA and the Alliance are recommending that CMS’s initial foray into the pay for performance system be on a voluntary basis (“pay for reporting”) out of separate funds, rather than a withhold system of P4P pulled from the main Medicare funds.
Modifying the iPledge Program
Thanks to last-minute concessions based on AADA recommendations, an improved version of the iPledge pregnancy risk management program with clearer definitions and parameters went into effect on Jan. 1, 2006.
The AADA had been opposed to many aspects of the FDA-approved restricted distribution program created jointly by the four manufacturers and FDA to eliminate fetal exposure to isotretinoin (Accutane, Sotret, Amnesteem, Claravis). As it was originally approved, dermatologists considered the program to be cumbersome, confusing and generally an obstacle to compliance.
Diane Thiboutot, M.D., was among those who met with the FDA, Covance, and drug manufacturers to detail AADA concerns.
“Our objective in meeting with the manufacturers was to try to implement some of our key points,” she says. These points, she explains, ranged from seeking clarification or modification of a number of program requirements to their proposal of an initial pilot program.
After attending this meeting and receiving a letter reiterating AADA recommendations, the four manufacturers responded with identical letters. There they clarified acceptable pregnancy tests, how to handle denied prescriptions, the delegation of iPledge-related duties to staff members, and spelled out gray areas concerning off-label use of the drug. They were also more specific about how the program extends to minors, prisoners and the homeless, and they added more accurate terminology to describe exactly who is targeted by the program.
However, the manufacturers wrote, the proposed pilot testing “would not be feasible” and would “delay implementation”, and requests concerning the use of consent forms and revising the definition of an office visit were deferred: “We have, however, implemented evaluation plans and will assess the new program in an ongoing fashion to make improvements,” concluded their letter.
Dr. Thiboutot was encouraged by the progress that was made. “We didn’t get everything, but I’d say we got half of what we requested. We were able to voice our concerns to the parties involved and work with them to try to be in on providing input on how to improve the program once it’s released. As with anything new, until you really get into it, you can’t identify what all the obstacles might be.”
Skin Research Funding Increase May Add up to a Decrease
The good news for skin disease researchers is that they may receive an increase in National Institutes of Health (NIH) funds allocated via the National Institute of Arthritis and Musculoskel-etal and Skin Diseases.
The bad news, says Jouni J. Uitto, M.D., Ph.D., Chair of the AADA’s Research Committee, is that this increase at 0.7% is “abysmal”.
“When you consider inflation and the increased cost of doing research, this is in reality a reduction that will impact not only on dermatology research but also on training people in biomedical research,” claims Dr. Uitto, who is also Professor and Chair, Department of Dermatology and Cutaneous Biology, Jefferson Medical College of Thomas Jefferson University.
With the domestic portion of the federal budget flat, explains Dr. Uitto, lobbying for a larger slice of the NIH pie is harder than ever — especially now that natural disasters and the War in Iraq have further stiffened competition for scarce funds.
Such lobbying, he explains, takes place on Capitol Hill, when AADA members, in collaboration with the Society for Investigative Dermatology and the Coalition of Patient Advocacy organizations attempt to impress upon Senators the importance of biomedical research and seek the legislatures’ support in increasing NIH funds allocated to the National Institute of Arthritis and Musculoskeletal and Skin Diseases.
Dr. Uitto finds this disappointing increase especially distressing in view of the success of previous efforts. “As a result of the efforts of both the AADA and other biomedical organizations/ societies, legislators committed to supporting biomedical research were so successful in the past, within a 5-year period they were able to double funds for NIH,” he states.
“At a time when only 1 out of 10 grants applied for gets funded,” he adds, “far too much important research does not get done thanks to limited availability of funds for domestic programs.”
Dermatology Residency Support Program “Sunsetted”
Despite carefully collected and evaluated data showing a shortage of dermatologists in the United States, feedback from members has prompted the AADA to significantly scale back a program designed to fund residency grants.
The Dermatology Residency Support (DRS) Program, which funded residency grants for 10 programs starting in 2006, was to have been ongoing. However, in light of feedback from members and the circulation of a petition to propose a Bylaws Amendment on the DRS program, that program was modified to a pilot program a year ago. As it stands now, it will not be renewed after the current residents complete their 3-year stints.
AAD President Clay J. Cockerell, M.D., claims those initially involved in creating the pilot program were caught totally off-guard by a grass-roots movement not only protesting this program but proposing a bylaws amendment — to be voted on beginning at the upcoming AADA meeting in March. This amendment, he says, could preclude the AADA from becoming involved in workforce initiative issues in the future.
Dr. Cockerell says, regardless of the vote, the DRS program will be “sunsetted”. The Academy’s efforts will focus on a variety of alternatives to deliver dermatology services instead of funding residencies, including teledermatology and properly supervised physician assistants and nurse practitioners.
“For years, we had been hearing about a shortage of dermatologists, so we appointed a Workforce Initiative task force to study this issue. We approached it scientifically, using demographics and other tools,” explains Dr. Cockerell.
The Academy’s research had indicated that many areas of the country do have a shortage of dermatologists, but found that some have an oversupply.
“In hindsight, I’d say what we should have done is examine allocation — that is, how to interest dermatologists practicing in Manhattan to practice in underserved areas such as east Texas.”
So, although the AADA has already dealt with the main issue, the vote on the bylaws amendment will take place as planned beginning at the March meeting. The problem with this, explains Dr. Cockerell, lies in a provision that would forbid the Academy’s involvement in workforce initiative issues.
“We understand that the members wanted to proceed with their action and weigh in on the issue of sponsored residencies. However, as it is currently written, the AADA recommends against it because it would straightjacket the Academy from looking at workforce issues globally.”
The bottom line, he says, is that the AADA is no longer “in the business of funding residency positions.” And should that need arise in the future? “We’d wait for our membership to come to us,” he concludes.
A ccording to some American Academy of Dermatology Association (AADA) insiders, much of the legislative focus in 2006 will be about money — getting as much of it as possible for skin disease research, curbing skyrocketing premiums by limiting medical malpractice liability, and implementing a fix for the flawed sustainable growth rate formula that threatens to reduce Medicare payments to physicians by about 26% over the next 6 years.
But discussion topics will also reflect the importance of effective communication on issues that affect the AADA’s membership, as in the Academy’s partially successful efforts to make the iPledge program for isotretinoin more user-friendly for both patients and physicians, and the Academy’s scaling back of industry-sponsored residencies after becoming aware of its members’ objections.
Medical Liability Reform and Beyond
Medical liability reform that places a cap on economic damages to harmed patients serves the best interests of patients as well as physicians, maintains dermatologist Susan Taylor, M.D., who is a member of the coalition of Doctors for Medical Liability Reform (DLMR).
Yet despite U.S. House of Represen-tatives passage of a bill capping such damages at $250,000, the Senate has yet to approve its version of that bill.
High malpractice premiums, claims Dr. Taylor, pose a threat to the AADA’s “highest priority” — patient safety. She adds, “We want patients in our specialty and other specialties to have access to the finest medical care available.”
Such access, she suggests, is threatened in states that have escalating premiums that could prompt physicians to relocate or stop providing high-risk procedures to patients.
The effort to make both physicians and their patients aware of how escalating medical liability premiums can affect the practice of medicine and patient care is currently spearheaded by DLMR, a coalition of 10 medical specialty groups, including the AADA. In the face of the current Congressional stalemate, DLMR has intensified its lobbying efforts and aimed a public awareness campaign squarely at states considered to be in crisis.
Dr. Taylor says physician outreach efforts are aimed at all doctors, not just those in high-risk specialties. “All specialties are impacted — including dermatology.”
She stresses the importance of arriving at a solution that is fair to both physicians and patients, placing an especially fine point on the distinction between patients’ rights to recover damages and the size of such awards in recent years.
“It’s important that we stabilize the medical liability market, but we also want to make sure that patients who are injured are fairly and quickly compensated for any damages. What we want to end is medical lawsuit abuse,” she insists.
DMLR continues to lobby for support of the $250,000 cap specified in H.R. 5, the HEALTH Act of 2005. However, its main objective is placing a limit on non-economic damages awarded in medical malpractice lawsuits.
The specific amount of that cap, she suggests, is negotiable. “I think that having a cap — whatever it is — is preferable to the situation we have now.”
Dr. Taylor says the Academy also supports congressional consideration of alternative approaches to medical liability reform, such as the National Medical Error Disclosure and Compensation (MEDiC) Act, S. 1784, which encourages practitioners to apologize to patients and their families when a medical error has occurred and promotes early offers of compensation.
Can AADA Help Fix the Medicare Payment Formula?
Unless something is done to correct the sustainable growth rate (SGR) formula that determines Medicare payments to physicians, re-imbursements may be reduced by as much as 26% over the next 6 years.
As it stands now, the Concurrent Budget Resolution, which passed in both houses of Congress, translates into a 4.4% decrease for 2006. While the Senate’s passage of a budget reconciliation package that instead resulted in a 1% increase — at least for 2006 —
is encouraging, nearly all affected by the cuts agree that it doesn’t solve the problem.
Sacramento, CA, dermatologist Margaret E. Parsons, M.D., Chair of the AADA’s Council on Government Affairs and Health Policy and Practice, is concerned.
“The legislation with the 1% fix for 1 year is not fixing the bigger picture: The SGR formula does not work now and didn’t when it was created 8 years ago mainly because it’s based on bad economics. This 1% fix is just a temporary Band-Aid,” she asserts.
What’s more, she points out, even if Congress were to pass a similar bill, without changes to the SGR formula, the pool of available Medicare funds would be sharply reduced as soon as 2007, when the proposed mandated pay for performance incentives (P4P) would further cut into Medicare funds.
“Unless something is done right now to fix the SGR formula, on Jan. 1, 2006, it will reduce payments to physicians by 4.4%,” she maintains.
Dr. Parsons is hopeful that such a last-minute solution can be reached during current talks between Centers for Medicare & Medicaid Services (CMS) and the Alliance of Specialty Medicine, which represents 13 national medical specialties, including the AADA.
Toward this end, explains Dr. Parson, the AADA, in conjunction with the Alliance of Specialty Medicine, has been meeting “aggressively” with Dr. Mark McClellan, M.D., Ph.D., Administrator of CMS, and his staff, on the main issues:
1. creating a new formula for re-imbursement based on appropriate economics
2. incorporating pay for performance (P4P) in a positive, not punitive manner.
“The complication as far as P4P goes is that we don’t know how it is going to work,” says Dr. Parsons. “Unlike some of the internal medicine specialties that have disease measures that can be more easily tracked, dermatology, like many specialties, is in the process of developing measures, but it still lacks a system that can be easily tracked and judged,” asserts Dr. Parsons. “To mandate a system that is not developed and understood with standards and measures that have been tested is completely illogical.”
Speaking for most dermatologists, Dr. Parsons insists, payment to physicians should be based on appropriate economics, such as the Medical Economic Index, and the realities of their own specialties and individual practices. And that, she says, means an SGR fix that considers physician’s actual costs and a pay for performance program based on incentives, not penalties.
The AADA and the Alliance are recommending that CMS’s initial foray into the pay for performance system be on a voluntary basis (“pay for reporting”) out of separate funds, rather than a withhold system of P4P pulled from the main Medicare funds.
Modifying the iPledge Program
Thanks to last-minute concessions based on AADA recommendations, an improved version of the iPledge pregnancy risk management program with clearer definitions and parameters went into effect on Jan. 1, 2006.
The AADA had been opposed to many aspects of the FDA-approved restricted distribution program created jointly by the four manufacturers and FDA to eliminate fetal exposure to isotretinoin (Accutane, Sotret, Amnesteem, Claravis). As it was originally approved, dermatologists considered the program to be cumbersome, confusing and generally an obstacle to compliance.
Diane Thiboutot, M.D., was among those who met with the FDA, Covance, and drug manufacturers to detail AADA concerns.
“Our objective in meeting with the manufacturers was to try to implement some of our key points,” she says. These points, she explains, ranged from seeking clarification or modification of a number of program requirements to their proposal of an initial pilot program.
After attending this meeting and receiving a letter reiterating AADA recommendations, the four manufacturers responded with identical letters. There they clarified acceptable pregnancy tests, how to handle denied prescriptions, the delegation of iPledge-related duties to staff members, and spelled out gray areas concerning off-label use of the drug. They were also more specific about how the program extends to minors, prisoners and the homeless, and they added more accurate terminology to describe exactly who is targeted by the program.
However, the manufacturers wrote, the proposed pilot testing “would not be feasible” and would “delay implementation”, and requests concerning the use of consent forms and revising the definition of an office visit were deferred: “We have, however, implemented evaluation plans and will assess the new program in an ongoing fashion to make improvements,” concluded their letter.
Dr. Thiboutot was encouraged by the progress that was made. “We didn’t get everything, but I’d say we got half of what we requested. We were able to voice our concerns to the parties involved and work with them to try to be in on providing input on how to improve the program once it’s released. As with anything new, until you really get into it, you can’t identify what all the obstacles might be.”
Skin Research Funding Increase May Add up to a Decrease
The good news for skin disease researchers is that they may receive an increase in National Institutes of Health (NIH) funds allocated via the National Institute of Arthritis and Musculoskel-etal and Skin Diseases.
The bad news, says Jouni J. Uitto, M.D., Ph.D., Chair of the AADA’s Research Committee, is that this increase at 0.7% is “abysmal”.
“When you consider inflation and the increased cost of doing research, this is in reality a reduction that will impact not only on dermatology research but also on training people in biomedical research,” claims Dr. Uitto, who is also Professor and Chair, Department of Dermatology and Cutaneous Biology, Jefferson Medical College of Thomas Jefferson University.
With the domestic portion of the federal budget flat, explains Dr. Uitto, lobbying for a larger slice of the NIH pie is harder than ever — especially now that natural disasters and the War in Iraq have further stiffened competition for scarce funds.
Such lobbying, he explains, takes place on Capitol Hill, when AADA members, in collaboration with the Society for Investigative Dermatology and the Coalition of Patient Advocacy organizations attempt to impress upon Senators the importance of biomedical research and seek the legislatures’ support in increasing NIH funds allocated to the National Institute of Arthritis and Musculoskeletal and Skin Diseases.
Dr. Uitto finds this disappointing increase especially distressing in view of the success of previous efforts. “As a result of the efforts of both the AADA and other biomedical organizations/ societies, legislators committed to supporting biomedical research were so successful in the past, within a 5-year period they were able to double funds for NIH,” he states.
“At a time when only 1 out of 10 grants applied for gets funded,” he adds, “far too much important research does not get done thanks to limited availability of funds for domestic programs.”
Dermatology Residency Support Program “Sunsetted”
Despite carefully collected and evaluated data showing a shortage of dermatologists in the United States, feedback from members has prompted the AADA to significantly scale back a program designed to fund residency grants.
The Dermatology Residency Support (DRS) Program, which funded residency grants for 10 programs starting in 2006, was to have been ongoing. However, in light of feedback from members and the circulation of a petition to propose a Bylaws Amendment on the DRS program, that program was modified to a pilot program a year ago. As it stands now, it will not be renewed after the current residents complete their 3-year stints.
AAD President Clay J. Cockerell, M.D., claims those initially involved in creating the pilot program were caught totally off-guard by a grass-roots movement not only protesting this program but proposing a bylaws amendment — to be voted on beginning at the upcoming AADA meeting in March. This amendment, he says, could preclude the AADA from becoming involved in workforce initiative issues in the future.
Dr. Cockerell says, regardless of the vote, the DRS program will be “sunsetted”. The Academy’s efforts will focus on a variety of alternatives to deliver dermatology services instead of funding residencies, including teledermatology and properly supervised physician assistants and nurse practitioners.
“For years, we had been hearing about a shortage of dermatologists, so we appointed a Workforce Initiative task force to study this issue. We approached it scientifically, using demographics and other tools,” explains Dr. Cockerell.
The Academy’s research had indicated that many areas of the country do have a shortage of dermatologists, but found that some have an oversupply.
“In hindsight, I’d say what we should have done is examine allocation — that is, how to interest dermatologists practicing in Manhattan to practice in underserved areas such as east Texas.”
So, although the AADA has already dealt with the main issue, the vote on the bylaws amendment will take place as planned beginning at the March meeting. The problem with this, explains Dr. Cockerell, lies in a provision that would forbid the Academy’s involvement in workforce initiative issues.
“We understand that the members wanted to proceed with their action and weigh in on the issue of sponsored residencies. However, as it is currently written, the AADA recommends against it because it would straightjacket the Academy from looking at workforce issues globally.”
The bottom line, he says, is that the AADA is no longer “in the business of funding residency positions.” And should that need arise in the future? “We’d wait for our membership to come to us,” he concludes.
Current Issue
October 2024
Volume 32
Issue 7
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