October 31, 2005

HEADLINE

Medicare Physician Update and Value-Based Purchasing in Senate Legislation
This week, the Senate Finance Committee, which as jurisdiction over the Medicare and Medicaid programs, passed legislation that provides a 1 percent increase in Medicare payments to physicians in 2006. This provision, if ultimately adopted by Congress and signed by the President, will avert the 4.4 percent cut in Medicare payments to physician’s that was expected in 2006.

In exchange for providing a positive update for physicians in 2006, the Senate Finance Committee is encouraging physicians and other providers to participate in a Medicare Value-Based Purchasing system (another name for pay-for-performance) where providers who achieve certain quality standards are rewarded with additional reimbursement.

The Medicare value-based purchase system would have three phases:

- Data Reporting Phase - Physicians would be requested to provide voluntary data on quality measures. Physicians who did not provide data would receive reduced Medicare payments.
- Public Notice of Quality Providers - Providers who meet quality thresholds would receive additional Medicare payments. The public would have access to which providers are receiving quality payments.
- Public Release of Quality Data - Payments to quality providers would continue. In this phase the public would have access to actual data on physician providers.

The system is paid for by cuts in Medicare physician reimbursement in years 2009-2011. The Senate Finance Committee bill creates a similar value-based purchasing system for hospital and skilled nursing facilities.

The Medicare physician update provision and the value-based purchasing system were two of several provisions that will impact the medical community. Overall, the legislation generated $4.2 billion in Medicaid cuts and $5.7 billion in Medicare cuts over the next 5 years. Below are selected provisions included in the Senate Finance Committee bill:

- Two-year extension of the 50 percent compliance threshold used to determine whether a hospital or unit of a hospital is an inpatient rehabilitation facility under the Medicare program

- Prohibition on physician self referrals to physician-owned limited service hospitals

- One-year extension of moratorium on therapy caps

- Transfer of title of certain DME to patient after 13-month rental

- Changes Medicare and Medicaid reimbursement for covered prescription drugs by adjusting the calculation of the average wholesale price of drugs (AWP).

CLEAN AIR ACT

ATS Calls for Tightening of EPA Fine Particulate Matter Standard
Last week, the ATS and six other health professional organizations sent a letter to EPA Administrator Stephen Johnson asking for the Environmental Protection Agency to significantly tighten the exposure standard for fine particulate matter. Specifically, the organizations signing the letter recommended EPA propose a revised National Ambient Air Quality Standard (NAAQS) for fine particulate matter (PM 2.5) of:

- 12 µg/m3 for the average annual standard
- 25 µg/m3 for the 24-hour standard
- 99th percentile used for compliance determination

The letter noted that an EPA staff analysis has concluded that the current standard for exposure to particulate matter is insufficient. Several studies have shown significant adverse health effects, including heart disease and exacerbation of respiratory disease, at exposure levels below the existing standard. The EPA internal document laid out a series of options to adjust the fine particulate matter standard to better protect public health. The standard recommended in the health group’s letter represents the strictest options proposed by EPA staff.

The EPA is under a court order to issue revised standards for fine particulate matter by December 20, 2005.

Joining the American Thoracic Society on the letter were the following organizations; the American College of Cardiology, the American College of Preventive Medicine, the American Public Health Association, the American Association of Respiratory Care, the American Association of Cardiovascular and Pulmonary Rehabilitation, and the National Association for the Medical Direction of Respiratory Care.

ATS Meets With EPA Administrator
In related activity, ATS Environmental Health Policy Committee member Dorr Dearborn MD, PhD met with Environmental Protection Agency (EPA) Administrator Stephen Johnson to discuss the EPA’s forthcoming proposed rule on fine and course particulate matter. In the meeting Dr. Dearborn encourage Mr. Johnson to propose a standard that would provide adequate protection for the nation’s public health.

Dr. Dearborn found Mr. Johnson to be very knowledgeable and informed on the issue, and receptive to input from the community. While the meeting was cordial, Mr. Johnson did not provide any insight on what the proposed EPA rule might contain.

RESEARCH

ATS Comments on Proposed NIH Reauthorization Legislation
This week, the ATS sent a letter to House Energy and Commerce Chairman Joe Barton (R-TX) critiquing the draft legislative proposal to reauthorize the National Institutes of Health (NIH).

In the letter, the ATS points out many areas of concern with the proposed legislation, including:

- Granting the NIH director the authority to consolidate and eliminate institutes, centers and offices with little public input and no Congressional oversight

- The elimination of specific budget authority for institutes

- The arbitrary division of institutes into two categories – “mission specific� and “science enabling� institutes

The letter also notes the need to give the NIH director additional budget authority to fund high risk/high reward research and cross-cutting research. However, in the letter the ATS questions the wisdom of giving the NIH director so much budget authority drain resources from existing institutes to essentially create a “NIH Director’s Institute�.

While Chairman Barton has expressed interest in moving his legislative proposal forward, there is no vote scheduled in the near future. Additionally, the Senate has not yet expressed an interest in drafting NIH authorization legislation.

PUBLICATION POLICY

ATS Supports Journal Linking to Enhance Public Access
The ATS joined 57 organizations in a letter to National Institutes of Health (NIH) Director Dr. Zerhouni, recommending that NIH achieve its goal of enhancing public access to federally funded research by establishing a public-private partnership with NIH that would take advantage of the fact that most not-for-profit publishers already make all their research articles - not just NIH-supported ones - available for free to the public 12 months or less after publication. The letter recommends rather than have NIH use valuable resources to create a new publishing and archiving effort, NIH should use existing links from NIH’s highly respected PubMed (an established engine of scientific literature) to academic journal websites. Using these links, readers can access the final, published articles already residing on peer-reviewed scientific journals’ websites. Linking is seamless; the reader would simply click on the desired link and be transferred automatically to the journal’s website.

As you may recall, in May 2005, NIH initiated a policy that “requests,� but not require, all researchers to share a copy of their peer-reviewed manuscripts that have been supported fully or in part by NIH funds. Manuscripts will be posted on NIH’s National Library of Medicine PubMed Central, a web-based archive. Authors of the posted articles are directed to establish a public release date for the manuscript – up to 12 months after initial publication in a peer-reviewed journal.

The ATS, along with several publishers of not-for-profit scientific journals, expressed significant concerns with the NIH policy, including that it would undermine the economic viability of many not-for-profit journals, essentially sets up a system of dual publication, is redundant and costly. The ATS believes the linking proposal will meet the expressed needs of the NIH and public while maintaining the valuable role of peer-reviewed scientific journals published by academic societies like the ATS.

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