Although the AGA is pleased that the 27 percent cut did not go into effect and Congress enacted a temporary patch, we continue to call on Congress to reach an agreement on a long term solution to the broken reimbursement system and provide some stability to physicians and beneficiaries. AGA continues to meet with legislators to stress the importance of enacting a permanent solution.

The House had originally passed a package that would have given physicians a two year, 1 percent update and extended the payroll tax and unemployment insurance. However, the Senate rejected this proposal due to certain “pay-fors,” such as cuts to the Patient Protection and Affordable Care Act, and beginning movement on the Keystone XL pipeline, opposed by the president and the Democratic Senate. The Senate passed their own two month extension by a vote of 89-10, but House Republicans were demanding that the Senate return to negotiate the package. However, with time running out and increasing pressure to agree with the Senate, House Republicans relented and passed the legislation. This two month reprieve delays another showdown over taxes and the Medicare physician reimbursement fix until February.

Continue to read the AGA Washington Insider and AGA eDigest for more updates on this critical issue.

Last week, the House passed a legislative package that included a two year, one percent update for Medicare reimbursement for physicians. But, the Senate Democrats indicated that the House package was objectionable since it paid for the extensions by allowing construction on the Keystone XL pipeline project, which is opposed by President Obama and Senate Democrats.

Then, last weekend, the Senate reached a bipartisan agreement, which was overwhelmingly passed by a vote of 89-10, extending current payment rates for physicians for two months. The package also included a two month extension of the payroll tax and an extension of unemployment insurance, a deal that was brokered by Senate Majority Leader Harry Reid, D-NV, and Senate Minority Leader Mitch McConnell, R-KY.

However, it became apparent over the weekend that House Republicans did not want to accept the Senate compromise and voted today to move to conference with the Senate on their two versions, essentially rejecting the Senate proposal. The Senate is in recess for the rest of the year, and the House is calling on the Senate to come back in session and accept the House bill. The Senate is telling the House to accept their bill.

And Congress wonders why their approval rating is in the single digits?

With physicians and their patients caught in the middle of these dysfunctional crosshairs, CMS has announced that they will hold claims through Jan. 17, 2012, so that the scheduled 27.3 percent cut will not be processed.

Last year, Congress had to pass five temporary patches to prevent cuts from being implemented, and again this year, Congress is unable to reach an agreement to provide stability to physicians and the millions of seniors who rely on Medicare for their health care.

The AGA continues to call on Congress to put politics aside and to reach an agreement to provide some long term stability for physicians and their patients. Physicians should not be used as a political football. This disruption will only continue to threaten seniors’ access to care.

We will continue to monitor this extremely volatile situation and call on Congress to do the right thing and reach an agreement.

The House and Senate also are working diligently to reach a deal on a temporary fix to the Medicare physician payment formula to prevent the 27 percent cut in reimbursements from being implemented on Jan. 1, 2012. The package will be tied to other items, such as extending the payroll tax and unemployment benefits. As of this writing, negotiators are discussing a one year fix to the sustainable growth rate formula (SGR), but have also discussed a more short term, one month fix in the event that negotiations break down.

This situation is extremely fluid, but both sides would like to reach an agreement this weekend. AGA continues to push a long term SGR fix with legislators since each year they fail to produce a long term solution, the deeper it increases deficit spending.

Stay tuned for more updates on these issues critical to gastroenterology on the AGA Washington Insider.

Senate Majority Leader Harry Reid, D-NV, indicated that the Senate would not pass this bill and would need to craft a new proposal that would be palatable to both the House and Senate. As of this writing, it is uncertain what the final package will look like and whether or not the physician fix will be one or two years.

The AGA, along with all of organized medicine, continues to push Congress for a long term fix to the sustainable growth rate formula that provides stability to both physicians and beneficiaries. We continue to press Congress to fix the problem this year, although we are hearing that fixing the 27 percent cut could spill over into January. This process remains extremely volatile and we will continue to provide updates on any progress on the AGA Washington Insider and AGA eDigest.

The costs would be offset in part by raising Medicare premiums on wealthy beneficiaries by 15 percent in 2017 and cutting prevention funds from the Patient Protection and Affordable Care Act (PPACA). The Republican package calls on the General Accounting Office (GAO) and the Medicare Payment Advisory Committee (MedPAC) to study the feasibility of aligning private payor quality and efficiency programs with Medicare. The language encourages GAO and MedPAC to consult with medical professional societies on their study.  

Republicans may bring this bill up for a vote next week as they have been whipping their members to secure the necessary 218 votes for passage. Reports have indicated that many conservative Republicans, particularly members of the freshman class, are opposed to extending the payroll tax and unemployment benefits. However, even if the House passes this “three-pack” bill, its fate is unknown in the Senate since Senate majority Leader Harry Reid, D-NV, and other Democrats oppose the offsets.

AGA is on Capitol Hill daily advocating that Congress prevent the 27 percent cut in physician reimbursements and provide a permanent solution to the Medicare physician payment formula. However, given the reality of our country’s fiscal climate and the difficulty that this Congress has had in agreeing to the most non-controversial items, a two year update may be the best case scenario. The AGA continues to meet with members on both sides of the aisle to discuss ideas for transitioning physicians to a new reimbursement system, and has learned that both Democrats and Republicans prefer to move physicians away from fee-for-service and into more value-based care. 

This process remains very unpredictable as Congress wants to finish their year-end business by Dec. 19 or 20. The AGA will continue to advocate for a fair and equitable reimbursement system that ensures patients have access to specialty care.

Look for updates on the AGA Washington Insider and AGA eDigest.

* Picture courtesy of the Architect of the Capitol.

Two parts out of the ten-part law will be debated, including the most contentious aspect of the PPACA — the individual mandate. At issue is whether Congress overstepped its power by passing the provision, which requires all Americans to buy health insurance or be monetarily penalized. 

“Conservatives believe that President Obama and congressional Democrats have expanded the government regulation to an unprecedented degree,” according to David Savage of the Los Angeles Times. The individual mandate was the key factor in garnering support from the insurance companies to support the PPACA because it controls costs and pools risks of the older Americans with the younger, healthier population who would not otherwise buy insurance. The Obama administration insists that the individual mandate is entwined with two other provisions, “one forbidding insurers to turn away applicants, and the other barring them from taking account of pre-existing conditions,” according to an article in The New York Times. 

Oral arguments will begin in March 2012 with the decision expected in late June, right before the hectic campaign months leading up to the general election. The political implications from the ruling will be complicated and unpredictable. Between the 26 states challenging the constitutionality of the law and the conservative leaning of the court, the unfolding of the case will be dramatic and tense. PPACA regulations have already begun to go into effect and will continue to do so until 2017. The decision will have a ripple effect in the political arena and on the future of health care. 

Since the PPACA was passed in March 2010, the law has sharply divided Democrats and Republicans. It played a significant role in the 2010 elections and will continue to be a huge factor in the 2012 elections. The unpopularity of the PPACA helped fuel the growth and electoral power of the Tea Party, which led to the Republican-controlled House. One of the first acts of the House was a symbolic vote to repeal the PPACA. Conservatives have also been fighting the PPACA in the courts. It was expected that the Supreme Court would pick up the case after the roster of challenging states continued to increase. Five and half hours have been slotted for the justices to hear both sides of the arguments, instead of the usual hour. The change in a very entrenched tradition emphasizes the importance and complexity of the case.  

The same The New York Times article states the “justices could uphold the law, strike down just its most controversial provision or some or all of the rest of it, or duck a definitive decision entirely as premature.” The implications of the court’s decision are being debated by political analysts. It would be a major accomplishment for the Tea Party and other conservatives, but if the court upholds the law, it could become a strong rallying campaign and fundraising issue that could defeat President Obama and the Democrats in the 2012 elections. On the other hand, if it is struck down, it could be the catalyst that rejuvenates the disillusioned Democratic base. If it is deemed constitutional, President Obama can claim success on his signature domestic legislation.  

The presidential campaign will mainly play out in the crucial battleground swing states. It is important to note that the individual mandate is very unpopular in two of these states — Missouri and Ohio. According to The Washington Times, Ohio “voters approved a constitutional amendment that disapproved the health insurance mandate by a crushing margin of 66 percent to 34 percent.” And in Missouri, “71 percent of the voters rejected the mandate.” The court’s decision will undoubtedly affect the campaign in these key states. 

As experts in the health-care field, gastroenterologists and their opinions are held in high esteem by politicians and legislators. As we prepare to move into the 2012 election season, it is important to become involved and stay active in politics in order to ensure the best possible future for specialty medicine. As many of you know, changes in politics happen at a local level through personal contact and relationships. If you would like to become more involved in AGA’s grassroots advocacy activities, contact Lauren DePutter. 

AGA will follow the 2012 campaigns closely, including the impact of Medicare reimbursement, research funding, and other important issues related to health-care reform and regulation, and provide updates on the AGA Washington Insider.

The sequestration will be devastating for gastroenterologists who are already facing a 27 percent cut in Medicare reimbursement beginning January 2012 unless Congress intervenes. The AGA, and all of organized medicine, have been advocating that the super committee address the issue of the sustainable growth rate (SGR) and repeal the formula. However, since the committee failed, there will not be another opportunity on such a large scale to address the $300 billion SGR repeal. Already we are hearing that Congress will try to enact another short term fix to the SGR, possibly a year, and physicians will face another freeze or possibly a small cut. 

The sequestration could also have a dire impact on public health programs like NIH and CDC. It is estimated that if the sequestration goes into effect, programs like NIH and CDC could be cut by 7.8 percent in 2013, followed by cuts of 5.5 percent until 2021. These cuts would be devastating to NIH and medical research in the U.S., eroding progress and our economic competitiveness. Programs like CDC have already seen bare bones budgets over the past few years, and these cuts will hinder their ability to provide education and awareness, prevention, and promotion of GI diseases like colorectal cancer and IBD. 

Some Congressional leaders are already discussing undoing the sequestration since they do not want the Pentagon to have to absorb such deep cuts. Both sides have already begun to spin the “blame game” with Democrats blaming Republicans for not wanting to move on tax breaks for the wealthy and Republicans blaming Democrats for not wanting to offer more cuts to domestic programs. President Obama was blamed for not being more engaged in the process. 

The failure of the super committee to come to an agreement gives the Independent Payment Advisory Board (IPAB) more leverage since it is an independent panel of experts whose sole purpose is to make recommendations on cutting the growth of Medicare. The AGA opposes IPAB and continues to advocate against it since its recommendations will disproportionately impact physicians. However, its supporters just had their arguments strengthened with Congress’ failure to act. 

The AGA will continue to advocate that Congress take action to prevent the 27 percent cut in physician reimbursements and that they enact meaningful payment reform that provides stability to physicians and patients. We will also continue to advocate that Congress not make deep cuts to the NIH and CDC, and continues to invest in this important mission. 

Look for more updates on the AGA Washington Insider on these critical issues.

* Picture from PBS News Hour.

The budget battles remain however, with Congress needing to complete work on an additional nine unfinished appropriations bills, including Labor-HHS-Education, which incorporates key health programs such as NIH and CDC. It is likely that the remaining appropriations bills will be a part of a larger package or omnibus bill.

Congress will remain in session until at least Dec. 23, when they are supposed to vote on recommendations from the super committee. However, as of this writing, we are hearing that it appears the super committee will not reach an agreement by Nov. 23, which may lead to sequestration and automatic cuts to Medicare providers by 2 percent beginning January 2013. 

Regardless of whether the super committee presents recommendations, Congress must take action on the scheduled 27 percent cut in Medicare physician reimbursements, the sustainable growth rate formula (SGR). The AGA has been pushing the super committee and the House and Senate leadership to fix the SGR as part of their budget package since we firmly believe that Congress cannot honestly address the budget deficit without addressing the broken Medicare physician payment system. 

The process remains extremely fluid and we expect that Congress will likely go down to the wire on many of these issues. AGA continues to monitor the action of the super committee and advocates for an overhaul of the SGR. 

Look for more updates on the AGA Washington Insider.

As a start, AGA staff was invited to attend the National Journal’s “2012 Election Preview,” which featured top advisers to the 2012 GOP candidates and prominent political strategists. The speakers provided rare insight into the 2012 campaigns through a comprehensive review of the various factors that are playing out on the campaign trail. 

The main debate centered on whether November 2012 will be a referendum on President Obama or a choice between him and the Republican nominee. Opinions were divided across the partisan spectrum among the panelists. One thing is certain — the outcome will greatly affect the future of health care and gastroenterology.  

An important panel focused on what the economic environment might be post-election. The immediate future of health-care policy relies on the success (or failure) of the Congressional super committee. Rep. Mick Mulvaney, R-SC, stated, “No one believes the super committee is going to be able to do anything.” However, if the super committee does not succeed, sequestration will kick in, including a 2 percent automatic cut to Medicare providers. AGA continues to meet with some of the members of the super committee and emphasizes that any discussion must take into account the $300 billion sustainable growth rate (SGR) “hole.”  While there is bipartisan support for a permanent fix to the SGR mechanism for physician reimbursements, the question remains whether this issue will be addressed by the super committee, as offsets to reform the SGR formula would be required in addition to the super committee’s required $1.5 trillion cuts. 

During the election preview, the political pundits discussed the role of swing states and diversifying demographics. Charlie Black, a veteran GOP operative, believes that President Obama “can keep this a close race, but I don’t see how he can win if there’s no movement or turning around in people’s perception of the economy, and he only has a few months to do so.” Obama is personally popular, so people should not sell the president short. 

Steve McMahon of Purple Strategies referenced the redistricting process, which occurs every ten years after the census is taken. Despite the fact that Republicans took over the majority of state legislatures (which are usually responsible for redistricting) in the 2010 elections, it will be mostly a wash. According to the National Journal, “Obama has been unable to draw a sharp contrast on issues like middle-class tax cuts and the environment. But he’ll get that chance the moment a GOP candidate emerges.” The GOP has only managed to strengthen the districts of Republican incumbents. McMahon also warned that we may be seeing many incumbents lose in both parties since Congress has a historically low approval rating at the moment. 

All strategists seemed to agree that the chance that the Senate will flip is little better than 50/50 and it is highly unlikely that the House will gain a Democratic majority. Although the Rep. Paul Ryan’s, R-WI, GOP budget plan has not received a lot of attention recently, McMahon believes the Democrats will use the issue heavily during campaigns. Every single GOP House Republican member voted to approve the Ryan budget, which could cause them problems with the politically active Medicare population.

Another panel highlighted the top advisers to all the 2012 Republican presidential candidates, and the only topic they seemed to agree upon was their belief that President Obama has done a poor job in the White House and must be defeated. The main focus was on Mark Block, chief of staff to Herman Cain, because of the recent allegations regarding Mr. Cain’s alleged sexual harassment. Mr. Block refused to answer any questions even after several of the panelists insisted Mr. Cain must be vetted. Despite the scandal, Herman Cain was able to raise $250,000 in one day.  

AGA will follow the 2012 campaigns closely. Continue to read the AGA Washington Insider for more updates on the pending elections, Medicare reimbursement, research funding, and other important issues related to health-care reform and regulation.

AGA is supportive of the House-passed legislation — the implementation of the 3 percent withhold rule could have a negative impact on physician practices that are already grappling with numerous changes in the health-care law and face a 30 percent cut in Medicare reimbursement in January 2012. The IRS regulation could threaten cash flow for many practices and impact their ability to invest in technology and hire more employees. 

The IRS regulation in question requires federal, state and local governments to withhold 3 percent of all payments made to contractors and suppliers, including physician practices and other health-care providers. H.R. 674, which has bipartisan support, would prevent the regulation from being implemented. The legislation now awaits action in the Senate, and President Obama has indicated his support for passage. 

The AGA will continue to monitor the status of this legislation and urge its passage in the Senate.