PCMS Goes to Washington
By Thomas M. Brown, Jr., M.D.

I recently had the pleasure of joining several fellow PCMS members and PCMS Executive Director Kathie Lyman in Polk County Medical Society's April Washington, D.C. Fly-In. This trip provided us with the opportunity to meet with the Iowa Congressional delegation to discuss several concerns of PCMS physicians. Major discussion was focused on the issues regarding the inequities in Medicare reimbursement which plague Iowa's physicians and Medicare patients.

For example, the projected negative update to physician reimbursement is expected to continue for five years. After this year's 5.4% decrease, CMS projects decreases of 5.7% in 2003, 5.7% in 2004, 2.8% in 2005 and 0.1% in 2006. The projected physician conversion factor in 2005 will be less than the conversion factor in 1993. Reportedly a majority of the members of both houses of Congress were in favor of dramatically reducing this reduction last fall. However, no action was taken and the reduction is now in place and there are no definite plans to reinstate the former level of payment. The best guess is that sometime in September something may be done that probably will not be retroactive.

Also discussed was the unacceptably unjust formula for Medicare reimbursement that places Iowans Dead Last in state reimbursement per Medicare enrollee per year. The difference in reimbursement between the highest ranking states and the lowest ranking states is approximately 100%. Part of this difference is attributed to the "conservative culture" found in Iowa. Patients in Iowa seek less medical care, and physicians order less testing than higher utilization states. Whether this is over utilization by the highest-ranking states or under utilization by the lowest-ranking states, changing this is going to be difficult. On the other hand, there should be a way to restructure the reimbursement formula that takes into account the expense of practice so that unjust differences in fee schedules are no longer present. Senator Harkin proposes restricting the maximal range of distribution to 5% above and 5% below the average so that no one is lower than 95% and no one is higher than a 105%. This bill has very good prospects in the Senate, as many states are below average. However, in the House of Representatives, which is based on population, this approach is uncertain. Failure to correct this unfair system will perpetuate the injustice to Iowa's elderly and Iowa's economy and continue the punishing downward spiral of services for Iowa's Medicare beneficiaries.

Legislation to provide prescription drug payments will probably be enacted in September. There is $350 billion available over the next 10 years (or $35 billion per year). One of the major issues is whether prescription drug coverage will be made available to everyone or based on need. Although there is said to be no money to reverse the 5.4% per year reduction in Medicare reimbursement for hospitals, doctors, and nurses, and there may not be the political will to correct a grossly unfair medical reimbursement system, money and political will are available for the prescription drug program. Whatever happens with the other two issues will be attached to the legislation for the prescription drug program.

On a more optimistic note, it should be noted that in the recent past one inequity has been corrected. Urban areas of less than 1 million population and rural areas now receive the same reimbursement for DRG payments. Urban areas greater than one million continue to receive a 1.6% higher reimbursement (so they receive 101.6% of what the remainder of the country receives).

In our meetings with Senators Grassley and Harkin and Congressmen Ganske, Nussle and Boswell, we emphasized the projected downward spiral in hospital, physician and nursing services. The United States as a whole has a shortage of approximately 125,000 nurses. It would appear that many of these are in Iowa. Hospitals will continue to be forced to reduce services and perhaps close. Physician recruitment will continue to be a challenge, and many underserved areas will become more underserved as hospital services diminish. People will have to take time off from their jobs to drive into the smaller towns and transport their parents to areas where they can receive medical services. Declining reimbursement will have a negative impact on economic development both in terms of dollars coming into the state and lack of medical infrastructure required to attract new business. In many cities, both large and small, the hospital is one of the largest employers. A steady reduction in medical reimbursement will hinder economic recovery.

We also made the following requests: If you can't make things better, don't make it worse. If you cannot come up with any more money, don't continue to make things worse by increasing costs. Some examples include new legislation concerning privacy which increases work and results in unreimbursed costs and the regulations concerning the availability of interpreters, which will result in a greater cost than Medicare reimbursement (and enforced by the threat of civil penalties or jail). High overhead due to documentation requirements and threat of medical liability continue to be a problem. Please don't ask us to work harder for less money and then continue to find more ways to put us in jail.

This should not be issue of dollars for fighting terrorism against dollars for medical care. As we have seen, the front line in the war on terrorism is the first responders, the hospital emergency room and the doctor's office.