House Democrats Strike Deal On Geographic Disparities
Julian Pecquet , Inside Health Policy.com
March 20, 2010
House Democrats who had been irate over the elimination of a provision tackling geographic disparities in Medicare wrangled last-minute concessions early Saturday morning night that would benefit areas that provide high-quality care at a bargain. The changes, which include higher Medicare payments for physicians and hospitals in low-cost areas and a promise that HHS will tackle the issue, persuaded at least one member – Rep. Peter DeFazio (D-OR) – to vote yes for the bill.
The manager's amendment released Saturday also reduces the tax on medical devices, a change which may help explain the recent announcements by Reps. Brad Ellsworth (IN), Scott Murphy (NY) and Baron Hill's (IN) that they would vote for the bill (see related story). Also Saturday, the House Rules Committee wrote a rule that calls for separate votes on the Senate and reconciliation bills.
"I'm happy to report," Rep. Ron Kind (D-WI) said Saturday, "that we've reached an agreement with this legislation ... and perhaps more importantly with the administration – President Obama and [HHS] Secretary [Kathleen] Sebelius – that will put us on a clear path of changing the way we pay for health care in this country, from the current fee-for-service system we have now ... to a fee-for-value, a quality outcome-based system."
The lawmakers – members of the Quality Care Coalition who represent 17 states mostly from the Midwest and Northwest – said they worked with Obama administration officials until past 3 a.m. Saturday to craft changes to the Senate bill that can survive points of order. They said Sebelius met with their group Saturday morning.
The manager's amendment adds $200 million in both 2011 and 2012 to the Medicare hospital trust fund to pay higher rates in the 25 percent of counties with the lowest risk-adjusted spending. And it accelerates the phase-in of physician practice expense adjustments for areas below average payment rates by increasing the national blend in the Medicare Geographic Payment Cost Index (GPCI) in 2010 from ¼ to ½.
In addition, HHS sent the alliance a letter Saturday promising to conduct a geographic disparities study whose findings would be implemented by 2013.
Reps. Kind, Bruce Braley (D-IA), Jay Inslee (D-WA) and Betty McCollum (D-MN) praised the deal. Kind noted that the compromise adds language to the health care reform bill that provides "an immediate $800 million to address geographic disparities for both doctors and hospitals, as well as written guarantees from Health and Human Services Secretary Kathleen Sebelius for further action to reform Medicare reimbursement rates that do not qualify for reconciliation under the Byrd Rule (emphasis included)." The Senate bill had previously only provided a Medicare reimbursement fix for doctors.
He complained that the current system pays for the number of procedures ordered instead of the quality of care provided, resulting in $800 billion in wasteful spending. "We're correcting the unfairness of Medicare reimbursement rates with this measure and taking steps toward historic payment reform that rewards the value of care delivered instead of the quantity of care provided. This will lead to a more cost effective way to pay for and deliver health care in our country and lower costs in the long run, making health care more affordable for all Americans," Kind added.
The deal "represents a major breakthrough in health care reform that will finally reward Iowa's medical providers for the high-quality care they've been providing Iowa's families for years," Braley said. "After negotiating directly with Speaker Nancy Pelosi and representatives from the White House late Friday into the early hours of Saturday morning, I'm proud to say the health care bill will finally fix these inequities, move us to a better reimbursement model that emphasizes quality over quantity, and help recruit well-qualified health-care providers to Iowa - all because of changes I championed."
Inslee also applauded the compromise. "For many months, the Quality Care Coalition and I have been working on language that would shift our health care system from one that rewards the quantity of service to one that rewards quality of service. At 3 a.m. this morning, we reached a conclusion that accomplishes this. Washington State health providers, along with providers across the country, will no longer be penalized for being efficient and taking excellent care of their patients."
Likewise, McCollum said the agreement "will transform health care in America."
The lawmakers noted that Sebelius has promised the following steps:
- Institute of Medicine (IOM) study to reform the Medicare system to address all geographic disparities for doctors and hospitals and implementation of IOM recommendations by December 2012.
- IOM study based on Braley's house-passed language making firm recommendations to move toward high quality, low cost care across the health care sector and implementation of the recommendations, as part of the new Independent Payment Advisory Board, by 2014.
- Additional direction to the new Center for Medicare and Medicaid Innovation to further test innovative models to incent high quality, low cost care across the provider spectrum.
- A personal commitment from Sebelius to convene a National Summit on Geographic Variation, Cost, Access and Value in Health Care later this year."
Pelosi had said Friday that she would offer a manager's amendment but promised it "will be brief"and wouldn't address "too many issues."
Democrats were working out a compromise late into the night Friday, a senior House aide also said, and reached a compromise at about 3:30 a.m. Saturday morning.
Another senior House aide said meetings on geographic disparities have been going on for the past three or four days. -- Julian Pecquet (jpecquet@iwpnews.com)
Link to the story: http://www.insidehealthpolicy.com/
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