Psychiatrists and other physicians are increasingly likely to face major
changes in the way Medicare and other federal health insurance programs
reimburse them under varying health reform proposals before Congress.
Uncertainty over the new method that lawmakers will devise for reimbursing
physicians under any new public insurance or overhauled Medicare program has
been a concern for physicians watching the health reform debate unfold.
The Medicare payment system, called the sustainable growth rate formula
(SGR), would be replaced under a unified House Democrats' draft bill. The
House approach would give physicians a general rate increase in 2010 (instead
of a scheduled 21 percent cut) indexed to medical inflation and would replace
the SGR with a new funding formula in 2011. A new formula would increase
reimbursements annually by 1 percent more than that year's increase in the
gross domestic product.
The Congressional Budget Office has estimated that just keeping physician
payment rates at their current level would cost an additional $285 billion
over the next 10 years.
The cost implications and the need for repeated congressional action to
prevent large physician payment cuts required under the SGR formula have led
many in Congress to agree that changes are needed.
"Some health care providers deliver higher quality care at a lower
cost," said Sen. Max Baucus (D-Mont.), chair of the Senate Finance
Committee and a health-reform leader. "The options for delivery
reform"—and payment changes to accompany such
reform—"are meant to take the best ideas from people who are doing
things well and apply them everywhere we can."
Baucus's approach to physician payment would for three years replace the
SGR approach of paying for specific services with a new model that reimburses
for the totality of a patient's medical treatment and rewards higher-quality
care. Some physicians would be paid more under such a system, which allows the
creation of "accountable care organizations," or groups of
physicians who would collaborate on ways to improve the quality of their care
and reduce costs. Physicians in these exchanges could keep a portion of the
money they save the government.
"Teamwork among physicians, hospitals, and other providers can help
prevent costly hospital readmissions and keep patients from cycling between
nursing homes, hospitals, and other post-acute-care settings," said AMA
President J. James Rohack, M.D., in a June statement on proposals to change
the approach for calculating Medicare physician payment.
Although APA hasn't endorsed a particular proposal, Matthew Sturm, an
associate director of APA's Department of Government Relations, said"
we're glad to see a long-term SGR fix" proposed.