July 19, 2006

Medicaid Spending Projections Down

In a July 11 press release, CMS released a fact sheet showing Medicaid cost projections are once again declining, reflecting slower Medicaid spending growth in recent years.  For the fiscal year (FY) 2006-2015 period, projected Federal Medicaid costs are $224 billion lower than had been projected just a year ago – a reduction of  8 percent. This reflects a slowdown in Federal Medicaid spending growth from over 12 percent per year in fiscal year 2000-2002 to 7.2 percent from 2002-2005, down further to 4.6 percent projected for fiscal year 2006-2007.  State Medicaid spending growth has simultaneously slowed significantly, with many states projecting lower costs in FY 2006 than FY 2005.  States are also paying much less than had been predicted for drug coverage for “dual eligible” beneficiaries who are now getting coverage through Medicare.

Read the CMS fact sheet http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=1896

Also see Health Trends online article: U.S. Health Spending Projections for 2004-2014

Louisiana to Redesign Healthcare System

United States Department of Health and Human Services, Secretary Michael Leavitt, recently declared HHS support for the Louisiana Healthcare Redesign Collaborative of HHS. In providing the declaration, HHS encouraged establishment of the Collaborative and agreed to support its efforts by removing impediments to progress and rapidly reviewing the proposals it develops.

The mission of the Louisiana Healthcare Redesign Collaborative (Collaborative) is to develop, and oversee the implementation of, a practical blueprint for an evidence-based, quality driven health care system for Louisiana. This blueprint will serve as a guide to health care policy in Louisiana and to the rebuilding of health care in the hurricane-affected areas of the state.

The initial mission of the Collaborative is to develop and submit to the U.S. Department of Health and Human Services a comprehensive system-wide Medicaid waiver and Medicare demonstration proposal for parishes of the Greater New Orleans area, which is Region 1 of the Louisiana Department of Health and Hospitals (Jefferson, Orleans, Plaquemines, St. Bernard), that will guide the rebuilding of its health care system.

The Collaborative orientation is therefore both statewide and local. The vision of this Collaborative is that, once implemented, the redesign of Louisiana's healthcare system generally, and Greater New Orleans specifically, will serve as a model for the nation.

Visit the Collaborative Web site

Read the HHS press release

HHS: Adoption of Electronic Health Records

HHS Secretary Mike Leavitt announced yesterday a first round of ambulatory electronic health record products (EHRs) have been certified by the Certification Commission for Healthcare Information Technology (CCHIT). HHS awarded CCHIT a contract in fall 2005 to develop certification criteria and a certification process.

“This seal of certification removes a significant barrier to wide-spread adoption of electronic health records. It gives health care providers peace of mind to know they are purchasing a product that is functional, and interoperable and will bring higher quality, safer care to patients,” Secretary Leavitt said.

CCHIT certification indicates that EHR products meet base-line levels of functionality, interoperability and security in compliance with CCHIT’s published criteria. This impartial seal of approval paves the way for adoption of health IT products by limiting the risk associated with investing in health IT. CCHIT is continuing to evaluate products, and additional results will be announced at the end of the month and quarterly thereafter.

Read HHS press release

Pay-for-Performance Pilot Plan gets High Marks

When managed care companies or the federal government start putting forward plans to base physician reimbursements on quality measures, doctors often worry they will end up being losers. But a community health plan and the physicians who participate in it think they might have found a way in which everyone can be a winner.

HealthSpring, a the Nashville, Ten based insurer has been running what it calls a "pay-for-quality incentive program" with the Sumner Medical Group, a 15-physician practice in Gallatin, Tenn. By coordinating care for the roughly 1,200 Sumner patients enrolled in HealthSpring's Medicare Advantage program, plan officials hoped to improve patient health outcomes while decreasing overall costs for this population.

Subscribers can read this and other AMNews articles at:

http://www.ama-assn.org/amednews/2006/07/24/gvsb0724.htm

Physician Income Rising Slower Than Professional Pay

A survey shows that doctors' net income, when adjusted for inflation, has declined over almost a decade. Although physician income has increased, it has not kept up with inflation, according to a new study. Between 1995 and 2003, average physician net income from the practice of medicine declined about 7 percent after adjusting for inflation, according to Health Center Changes’ nationally representative 2004-05 Community Tracking Study Physician Survey (see Figure 1 and Data Source). Primary care physicians and surgeons fared the worst in keeping pace with inflation, while medical specialists fared the best.

After adjusting for inflation, medical specialists’ incomes have remained virtually unchanged since the mid-1990s. In contrast, primary care physicians—already the lowest earning of all physicians—have lost substantial ground (-10.2%) to inflation since the mid-1990s. Surgical specialists also experienced a significant reduction of more than 8 percent in real incomes between 1995 and 2003.  

Note: Figures for 2003 are adjusted for inflation to 1995 dollars. Percentages are rounded.

Source: AMNews and Center for Studying Health System Change

Read the Center for Studying Health System Change Report

Medicare: New Regulations Will Increase Hospital Reimbursements

Medicare spends more than $125 billion a year to reimburse nearly 5,000 hospitals for the care they provide to Medicare beneficiaries, CMS reported on Monday. The Bush Administration wants to make sure that those taxpayer dollars are well-spent so Medicare is not overpaying for some services, while underpaying for more severely ill patients and those with more complex illnesses.

It is reported these new regulations will not reduce the total amount of money that Medicare pays annually to reimburse hospitals. In fact, the Centers for Medicare & Medicaid Services (CMS) estimates payments to all hospitals will increase by 3.4 percent for FY 2007.

Currently, hospitals are reimbursed based on what they charge for care for a particular condition, such as pneumonia, regardless of how severe it is. Based on recommendations from Medicare Payment Assessment Commission (MedPAC) and other independent analysts, the Administration is taking steps to substantially improve the payment system so that payments reflect the actual costs of care, including the severity of a patient’s illness.

Payments for more severely ill patients and those with more complicated conditions will increase under these new regulations. Other procedures and treatments for which charges are significantly greater than actual costs may be reimbursed at a lower rate.

In a letter to the Administrator dated April 19, 2006, MedPAC expressed pleasure that CMS has proposed to implement three of MedPAC’s four recommended changes to the Prospective Payment System. MedPAC stated, “Current payment policies benefit hospitals that focus on less severely ill patients.”  The letter also states, “… we wanted to reiterate our strong support for improving the inpatient payment system’s ability to accurately compensate providers for the type and severity of the cases they treat.”

Medicare asked for comments on an overall proposal and is currently considering submitted comments on how the recommended reforms could be improved, and what transition steps would be appropriate to avoid disruptions from sudden changes in the payment system. The final regulations will address these comments, many of which involved steps to limit any potential short-term impact of the proposal and will be issued in a few weeks.

Read the full press release at http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=1899

State Society News

If your state society would like to announce meetings or share news stories with our readers, send your new items to Melinda Martin - mmartin@asipp.org

Florida

ASIPP member Rafael Miguel, MD was elected President of the Florida Society of Anesthesiologists (FSA) at the Annual Meeting held in Palm Beach, Florida this past June. At the June FSA Board of Directors meeting, passage of the Electronic Controlled Substances Prescription Monitoring Program was made a Legislative priority for the 2007 Florida Legislature Session. It will be presented by Dr. Miguel in September to the Annual Meeting of the Florida Medical Association, in order that they may also adopt the bill as a Legislative priority.

Please…Save the Date!!!

The New Hampshire Society of Interventional Pain Physicians Annual Meeting

The New Hampshire Society of Interventional Pain Physicians Annual Meeting will take place on Wednesday, September 27, 2006 at 6:00 p.m.CR Sparks, Bedford, NH

Your nursing and management staff are encouraged to attend as well. Guest speaker to be announced.

To register or for more information, contact:

Kacey Guay 603-577-3003 x31

kguay@painsolutionsusa.com