American College of Physicians commends MedPAC June 2008 report to Congress

June 20, 2008

Washington -- The American College of Physicians (ACP) today commended the Medicare Payment Advisory Commission (MedPAC) for its recognition of the importance of primary care in a well-functioning health-care delivery system in its June 2008 Report to Congress. ACP commended MedPAC in a letter to Glen D. Hackbarth, chairman of the diverse 17-member independent advisory Commission that advises the U.S. Congress on issues affecting the Medicare program. In addition, ACP broadly supported a specific recommendation included in MedPAC's report to increase Medicare Part B payments for primary care services. ACP also came out in favor of another MedPAC recommendation to establish a Medicare medical home pilot program. The Medicare medical home pilot, as recommended by MedPAC, would expand on a much more limited program authorized by Congress in 2006. Taken together, these recommendations by MedPAC would implement and evaluate two major payment strategies to address the current undervalution of primary care services and the trend toward decreased availability of primary care physicians and services.

MedPAC - which also is challenged with analyzing access to care, quality of care, and other issues affecting Medicare - reported that primary care services have been historically undervalued by Medicare and other payers.

"The result of the undervaluation has been that an average income for primary care physicians is at least 40 percent lower than most other medical specialties," said Jeffrey P. Harris, MD, FACP, president of the 125,000-member ACP. "The effects of this undervaluation include a precipitous decrease over the last decade in the share of U.S. medical school graduates entering primary care; an increase in the number of internal medicine residents choosing to subspecialize rather than enter into a general primary care practice; and a disproportionate number of physicians who have chosen the field leaving general practice compared to other specialties."

In its letter to MedPAC, ACP supported the Comission's recommendation that Congress establish a budget-neutral payment adjustment for primary care services billed under the physician fee schedule and furnished by primary-cared-focused practitioners, but recommended that MedPAC consider recommending changes in budget-neutrality rules to allow the Department of Health and Human Services (HHS), the agency responsible for administering these rules, to take into account the demonstrated impact of primary care in reducing overall Medicare program costs. A budget neutrality adjustment is unwarranted for investments in primary care that result in overall program cost reduction, such as those generated by reductions in preventable hospital admissions. ACP agrees with MedPAC that this adjustment should be made through use of a modifier to billing codes for primary care services further refined through the development of additional criteria to target the increases specifically to primary care physicians.

ACP also supported MedPAC's recommendation that Congress initiate a medical home pilot project in Medicare, noting that this would be a significant improvement over the Medicare medical home demonstration project Congress previously authorized under the Tax Relief and Health Care Act of 2006 (TRHCA). The new pilot should not delay moving forward on the existing medical home demonstration, but allow for the existing project to transition to the new recommended pilot.

MedPAC's report also outlined a number of stringent criteria that practices must meet to be eligible for participation in the medical home pilot. While ACP is supportive of most, if not all, of the criteria, it is concerned about the ability of most solo and small practices--the type of practices that provide care to the majority of Medicare beneficiaries--to meet them all. ACP recommends, therefore, that implementation of this project include mechanisms to assist a suitable number of the practices in meeting the criteria and participating in the pilot.

"The need for action is urgent," Dr. Harris said in conclusion. "ACP looks forward to helping Congress understand the importance of these recommendations and to assisting in their future implementation."
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Dr. Harris's letter is available on request.

ACP members include 125,000 internal medicine physicians (internists), related subspecialists, and medical students. Internists specialize in the prevention, detection, and treatment of illness in adults.

American College of Physicians

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