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SENATE FINANCE COMMITTEE BILL For more regularly updated information, visit the Powell Center blog. The Senate Finance Committee voted the bill out of committee with the vote of every committee Democrat along with Republican Olympia Snowe (Maine). Senate Majority Leader Harry Reid (D-Nev) is at work supervising negotiations to combine it with the bill reported out of the Senate Health, Education and Labor Committee in July. The Senate Finance Committee bill contains important elements that would greatly impact the ability of patients to receive unrationed medical care. And there are other places in the bill where the Secretary of Health and Human Services is given discretion to regulate the treatment that healthcare providers can give to their patients. The bill does contain language to prevent the use of comparative effectiveness analysis in a manner that would discriminatorily deny treatment because of age, disability, or terminal illness[1]; however, this provision would not affect the financial incentive to ration care as described below. The bill's funding partially comes from by a means that would keep up with what Americans spend on health care; however, half of the funding comes from cuts in Medicare spending[2] that would result in rationing life-saving treatment for senior citizens. One particularly dangerous provision penalizes doctors based on how much medical treatment they direct for senior citizens on Medicare. It establishes that for at least five years, beginning in 2014, Medicare physicians who authorize treatments for their patients that wind up in the top 10% of per capita cost for a year will lose 5% of their total Medicare reimbursements for that year.[3] This means that all doctors treating older people will constantly be driven to try to order the least expensive tests and treatments for fear that they will be caught in that top 10%. Note that this feature operates independently of any considerations of quality, efficiency, or waste – if you authorize enough treatment for your patients, however necessary and appropriate it may be, you are in danger of being one of the 1 in 10 doctors who will be penalized each year. Moreover, the penalty for Medicare doctors creates a moving target – by definition, there will ALWAYS be a top 10%, no matter how far down the total amount of money spent on Medicare is driven. Say that in 2015 the top 10% is anything over $10,000 per patient. In 2016 most doctors will scramble to hold down the treatments they authorize to avoid breaking that limit – with the result that the total amount spent will drop, so that the top 10% might then be, say, anything over $9,500. As the process repeats, the next year it might be anything over $9,000, the year after that anything over $8,000, and so on. It's like a game of musical chairs, in which there is always 1 chair less than the number of players -- so no matter how fast the contestants run, someone will always be the loser when the music stops. The disincentive to provide treatment for senior citizens the penalty creates is determined purely by cost, without any assessment of balancing cost with benefit. It will create a constant sense of uncertainty in doctors, since none can know in advance precisely what the cutoff for a given year will be – resulting in ever-increasing pressure to limit treatment and diagnostic tests to the bare minimum. In the words of National Right to Life Committee Executive Director David N. O'Steen, Ph.D., "This is the cruelest and most effective way to ensure that doctors are forced to ration care for their senior citizen patients. It takes the telltale fingerprints from the government: instead of bureaucrats directly specifying the treatment denials that will mean death and poorer health for older people, it compels individual doctors to do the dirty work. It is an outrageous way to 'reform' health care – by creating a 'death spiral' that year after year will deny more and more life-preserving treatment to America's senior citizens." It has been criticized by the American Medical Association and Alliance of Specialty Care Medicine, by civil libertarian columnist Nat Hentoff, and by editorials in the Wall Street Journal and Washington Times NOTES: [1] Before negotiations broke off in September 2009, a bipartisan group of six Senators on the Senate Finance Committee were working to produce an agreed bill. During those negotiations, the staffs of Senators Chuck Grassley (R-IA) and Mike Enzi (R-WY) after discussions with the staff for Senate Finance Committee Chairman Max Baucus (D-MT), Senator Kent Conrad (D-ND), and Dr. Ezekiel Emanuel, representing the Obama Administration, were able to secure agreement to incorporate in the portion of the bill relating to comparative effectiveness, the language below. Information is available on the dangers associated with some comparative effectiveness research. The language is in Sec. 1182, “LIMITATIONS ON CERTAIN USES OF COMPARATIVE EFFECTIVENESS RESEARCH,” beginning on page 1173, available at the Senate Finance website here. Language Relating to Comparative Effectiveness in the Senate Finance bill: ‘‘(c)(1) The Secretary shall not use evidence or findings from comparative effectiveness research conducted under section 1181 in determining coverage, reimbursement, or incentive program under title XVIII in a manner that treats extending the life of an elderly, disabled, or terminally ill individual as of lower value than extending the life of an individual who is younger, nondisabled, or not terminally ill. (2) Paragraph (1) shall not be construed as preventing the Secretary from using evidence or findings from such comparative effectiveness research in determining coverage, reimbursement, or incentive programs under title XVIII based upon a comparison of the difference in the effectiveness of alternative treatments in extending an individual’s life due to the individual’s age, disability, or terminal illness. (d)(1) The Secretary shall not use evidence or findings from comparative effectiveness research conducted under section 1181 in determining coverage, reimbursement, or incentive programs under title XVIII in a manner that precludes, or with an intent to discourage, an individual from choosing a health care treatment based on how the individual values the tradeoff between extending the length of their life and the risk of disability. (2)(A) Paragraph (1) shall not be construed to—(i) limit the application of differential copayments under title XVIII based on factors such as cost or type of service; or (ii) prevent the Secretary from using evidence or findings from such comparative effectiveness research in determining coverage, reimbursement, or incentive programs under such title based upon a comparison of the difference in the effectiveness of alternative health care treatments in extending an individual’s life due to that individual’s age, disability, or terminal illness. (3) Nothing in the provisions of, or amendments made by the America’s Healthy Future Act of 2009, shall be construed to limit comparative effectiveness research or any other research, evaluation, or dissemination of information concerning the likelihood that a health care treatment will result in disability. (e)(1) The Patient-Centered Outcomes Research Institute established under section 1181(b)(1) shall not develop or employ a dollars-per-quality adjusted life year (or similar measure that discounts the value of a life because of an individual’s disability) as a threshold to establish what type of health care is cost effective or recommended. (2) The Secretary shall not utilize such an adjusted life year (or such a similar measure) as a threshold to determine coverage, reimbursement, or incentive programs under title XVIII.” [2] According the Congressional Budget Office the Senate Finance Committee bill has "a gross total of $829 billion in credits and subsidies provided through the exchanges, increased net outlays for Medicaid and the Children's Health Insurance Program (CHIP), and tax credits for small employers." (Page 2). The net reduction in Medicare spending totals $410.7, which is 49.54% of $829 billion.
“(b) INCENTIVES FOR AVOIDING EXCESS
UTILIZATION.—Section 1848(a) of the Social Security Act (42 U.S.C.
1395w–4(a)), as amended by section 3002(b), is amended by adding at the end
the following new paragraph: While these adjustments may reduce the degree to which physicians are disproportionately penalized if they have sicker patients or work in high-cost areas, they do not change the fundamental danger of this provision, which (as explained above) is to create continual pressure on doctors to make ever-increasing reductions in the treatments and tests they order for their patients so as to avoid being in the penalized top 10%. CBO rates this as taking $900 million from Medicare payments over a period of 6 years. See CBO 10/7/09 letter to Chairman Baucus, Table entitled "Preliminary Estimate for Title I, Subtitle F, Through Title V of the Chairman's Mark, As Amended, the America's Healthy Future Act of 2009", page 3 of 9, line entitled "Expansion of Physician Feedback Program." |
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