Rural Medicare Equity Act of 2007

Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 70) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits. S 3101, and HR 6331, the Medicare Improvements for Patients and Providers Act of 2008. Supported provisions that prevent the 10.6% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.6% cut with an increase through 2008, and extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 through 2008. S.2812, the Medicare Improvement Act of 2008 introduced by senator Kent Conrad. This legislation will expand the number of originating sites, the list of eligible practitioners, and provide an advisory committee to CMS and Congress on payment issues related to services provided via TeleHealth. The Physician Payment Sunshine Act, S. 2029, introduced by Senator Kohl with Senator Grassley to create accountability among physicians and the manufacturers of drugs and devices that physicians utilize and prescribe for their patients. This legislation would require manufacturers of pharmaceutical drugs, medical devices, and biologics to disclose the amount of money they give to doctors through payments, gifts, honoraria, travel and other means. The Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Grassley to mitigate current inequities in Medicare reimbursement, improve access to health services in rural and underserved areas, and will begin to close the gap between Medicare reimbursement and the cost of providing services in predominantly rural areas. The legislation establishes a 1.0 floor for physician work and practice expense adjustments. It also revises the work and practice expense formulas to reduce payment differences and more accurately compensate physicians in rural areas for their true practice costs. The bill also extends the five percent incentive payments for primary care and specialty physicians in scarcity areas. Marshfield Clinic nominated Dr. Douglas Reding for an open position on the Medicare Payment Advisory Commission, and sought the endorsement of the Wisconsin delegation, and other Senators and Representatives that serve on the Committees with jurisdiction over the Medicare program. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Support for S.2785, the Save Medicare Access Act of 2008, introduced by Sen. Debbie Stabenow. It would avert the 10.6% cut to physician payments scheduled to take effect in July and the additional cut of 5% or more scheduled in January 09. Payments would continue at their current rate through the remainder of 2008 and then would rise by 1.8% in 2009. The current work GPCI floor and physician scarcity bonus would also be continued through the end of 2009. Pay-for Reporting and Performance Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. HR 6357, the Protecting Records, Optimizing Treatment and Easing Communications through Health Care Technology Act of 2008 is important legislation that promotes Health Information Technology and the protection of patients personal health information. HR 6357 codifies ONCHIT, provides grants and loans for HIT, but most importantly the bill creates new privacy and security provisions which require notification of breaches of PHI by covered entities and business associates. The bill also includes restrictions on certain disclosures of PHI allowing patients to request that their information not be released to health plans in certain circumstances. It also includes an impractical consent provision that requires additional patient consent if the PHI is utilized in operations, such as peer review, quality review, standard of care review, malpractice review, or best practices analysis. HR 6898 Health-e Information Technology Act of 2008, a bill that includes an estimated $4 billion in incentive payments to Medicare physicians and hospitals which demonstrate successful adoption and use of HIT once initial national technical standards are finalized. Support for privacy enforcement provisions. H.R.6179 the Promoting Health Information Technology Act of 2008 - provisions that encourage and facilitate the adoption of state reciprocity agreements for practitioner licensure in order to expedite the provision across state lines of telehealth services; and provisions that require the Centers of Medicare & Medicaid Services to make federally qualified health centers eligible to participate in demonstration projects related to health records and heath information technology. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. Support for Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Chuck Grassley especially provisions that would extend the 1.0 work floor through December 31,2009, and would recognize the equality of physician work in all geographic areas and eliminate differing work index values by establishing a national value of 1.0, effective 2010. Also support provisions for physician practice expense that would establish a practice expense floor of 1.0 for 2009 by requiring the Secretary to increase the value of any practice expense geographic index that was below 1.0 to 1.0 for services furnished on or after January 1, 2009 and before January 1, 2010. Subsection (b) would reduce the geographic adjustment for practice expense to 50 percent of the current adjustment for employee wages and rent, effective 2010. Support for Rep. Ron Kinds concept of a not yet introduced MEDICARE EFFICIENCY BILL that would amend the CHAMP Act (H.R. 3162) 304 in whole, by establishing that the 5% bonus payment would be expanded to the top 10% of efficient counties; and a corresponding 5% efficiency penalty for physicians in the bottom 10% of efficient counties. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Also supports efforts to eliminate the 2% threshold for payments and the 5% limitation on payments. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building".

Client expense: $110,000 · Firm income: Not reported

Government targets: Agency for Healthcare Research & Quality (AHRQ), Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, Health & Human Services, Dept of (HHS), Medicare Payment Advisory Commission (MedPAC), Natl Institutes of Health (NIH), SENATE

HR 2860 - Health Care Access and Rural Equity (H-CARE) Act of 2007, Title 2, Section 201 which calls for coverage of marriage and family therapist services and mental health counselor services under Part B of the Medicare Program. HR 3162 - Children's Health and Medicare Protection Act of 2007, Subtitle A, Section 607 which relates to coverage for marriage and family therapist services and mental health counselor services. S. 498 - Rural Medicare Equity Act of 2007 - legislation calls for improvement of the Medicare program for beneficiaries residing in rural areas S. 1605 - Craig Thomas Rural Hospital and Provider Equity Act of 2007, Section 16 which would provide coverage of marriage and family therapist services and mental health counselor services under Part B of the Medicare Program. HR 820 - To amend title XVIII of the Social Security Act to provide for the coverage of marriage and family therapist services under Part B of the Medicare Program, and for other purposes. HR 1663 - Title 3, Sec. 302. Coverage of marriage and family therapist services. To amend title XVIII of the Social Security Act to expand and improve coverage of mental health services under the Medicare Program. S. 2708 - Caring for An Aging America Act of 2008, Section 771 - Geriatric and Gerontology Loan Repayment Program

Client expense: Not reported · Firm income: $30,000

S.3: Medicare Prescription Drug Price Negotiation Act of 2007 S.158: Access to Affordable Health Care Act S. 273: Prescription Drug and Health Improvement Act of 2007 S. 290: Rural Physicians Relief Act of 2007 S. 334: Healthy Americans Act S. 397: Tax Equity and Affordability Act of 2007 S. 498: Rural Medicare Equity Act of 2007 S. 1342: HeLP America Act S. 1605: Craig Thomas Rural Hospital and Provider Equity Act of 2007 S. 1710: Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act, 2008 S. 2785: Save Medicare Act of 2008 S. 2603: Medicare Fraud Prevention Act of 2008 S. 2687: Medicare Beneficiary Protection Act of 2008 S. 2786: Medicare Rural Health Access Improvement Act of 2008 H.R.4: Medicare Prescription Drug Price Negotiation Act of 2007 H.R.15: National Health Insurance Act H.R.118: To amend part D of title XVIII of the Social Security Act to authorize the Secretary of Health and Human Services to negotiate prices for part D covered drugs for Medicare beneficiaries. H.R.205: Medicare Prescription Drug Enrollment Extension Act of 2007 H.R.298: Flexible Spending Accounts Growth and Opportunities Act of 2007 HR 914: Tax Equity and Affordability Act of 2007 H.R. 1651: Rural Health Quality Advisory Commission Act of 2007 HR 2056: Medicare Part D Improvement Act of 2007 HR 2633: HeLP America Act (Introduced in House) HR 2860: Health Care Access and Rural Equity (H-CARE) Act of 2007 HR 3014: Health Equity and Accountability Act of 2007 H.R. 3043: Department of Health and Human Services Appropriations Act, 2008 HR 3163: Healthy Americans HR 4848: To extend for one year parity in the application of certain limits to mental health benefits, and for other purposes HR 1424: Paul Wellstone Mental Health and Addiction Equity Act of 2007 HR 5445: To amend part B of title XVIII of the Social Security Act to increase Medicare payments for physicians' services through December 31, 2009.

Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 70) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits. S 3101, and HR 6331, the Medicare Improvements for Patients and Providers Act of 2008. Supported provisions that prevent the 10.6% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.6% cut with an increase through 2008, and extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 through 2008. S.2812, the Medicare Improvement Act of 2008 introduced by senator Kent Conrad. This legislation will expand the number of originating sites, the list of eligible practitioners, and provide an advisory committee to CMS and Congress on payment issues related to services provided via TeleHealth. The Physician Payment Sunshine Act, S. 2029, introduced by Senator Kohl with Senator Grassley to create accountability among physicians and the manufacturers of drugs and devices that physicians utilize and prescribe for their patients. This legislation would require manufacturers of pharmaceutical drugs, medical devices, and biologics to disclose the amount of money they give to doctors through payments, gifts, honoraria, travel and other means. The Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Grassley to mitigate current inequities in Medicare reimbursement, improve access to health services in rural and underserved areas, and will begin to close the gap between Medicare reimbursement and the cost of providing services in predominantly rural areas. The legislation establishes a 1.0 floor for physician work and practice expense adjustments. It also revises the work and practice expense formulas to reduce payment differences and more accurately compensate physicians in rural areas for their true practice costs. The bill also extends the five percent incentive payments for primary care and specialty physicians in scarcity areas. Marshfield Clinic nominated Dr. Douglas Reding for an open position on the Medicare Payment Advisory Commission, and sought the endorsement of the Wisconsin delegation, and other Senators and Representatives that serve on the Committees with jurisdiction over the Medicare program. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Support for S.2785, the Save Medicare Access Act of 2008, introduced by Sen. Debbie Stabenow. It would avert the 10.6% cut to physician payments scheduled to take effect in July and the additional cut of 5% or more scheduled in January 09. Payments would continue at their current rate through the remainder of 2008 and then would rise by 1.8% in 2009. The current work GPCI floor and physician scarcity bonus would also be continued through the end of 2009. Pay-for Reporting and Performance Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. HR 6357, the Protecting Records, Optimizing Treatment and Easing Communications through Health Care Technology Act of 2008 is important legislation that promotes Health Information Technology and the protection of patients personal health information. HR 6357 codifies ONCHIT, provides grants and loans for HIT, but most importantly the bill creates new privacy and security provisions which require notification of breaches of PHI by covered entities and business associates. The bill also includes restrictions on certain disclosures of PHI allowing patients to request that their information not be released to health plans in certain circumstances. It also includes an impractical consent provision that requires additional patient consent if the PHI is utilized in operations, such as peer review, quality review, standard of care review, malpractice review, or best practices analysis. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. Support for Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Chuck Grassley especially provisions that would extend the 1.0 work floor through December 31,2009, and would recognize the equality of physician work in all geographic areas and eliminate differing work index values by establishing a national value of 1.0, effective 2010. Also support provisions for physician practice expense that would establish a practice expense floor of 1.0 for 2009 by requiring the Secretary to increase the value of any practice expense geographic index that was below 1.0 to 1.0 for services furnished on or after January 1, 2009 and before January 1, 2010. Subsection (b) would reduce the geographic adjustment for practice expense to 50 percent of the current adjustment for employee wages and rent, effective 2010. Support for Rep. Ron Kinds concept of a not yet introduced MEDICARE EFFICIENCY BILL that would amend the CHAMP Act (H.R. 3162) 304 in whole, by establishing that the 5% bonus payment would be expanded to the top 10% of efficient counties; and a corresponding 5% efficiency penalty for physicians in the bottom 10% of efficient counties. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Subtitle C: Other Provisions - (Sec. 626) Provides that in FY 2004, starting April 1, 2004, the ambulatory surgery center (ASC) update will be the Consumer Price Index for all urban consumers (U.S. city average) as estimated as of March 31, 2003, minus 3.0 percentage points. Provides that in FY 2005, the last quarter of calendar year 2005, and each of calendar years 2006 through 2009, the ASC update will be zero percent. Provides that subject to recommendations by the General Accounting Office, the Secretary will implement a revised payment system for payment of surgical services furnished in ASCs. Requires the new system to be implemented so that it is first effective on or after January 1, 2006, and not later than January 1, 2008. (Sec. 628) Provides that there will be no updates to the clinical diagnostic laboratory test fee schedule for 2004 through 2008. Subtitle D: Additional Demonstrations, Studies, and Other Provisions - (Sec. 649) Directs the Secretary to establish a pay-for-performance demonstration program with physicians to meet the needs of eligible beneficiaries through the adoption and use of health information technology and evidence-based outcomes measures Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Also supports efforts to eliminate the 2% threshold for payments and the 5% limitation on payments. Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 H.R.1823 Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 introduced by Rep. Wally Herger and Kendrick Meek - Amends title XVIII (Medicare) of the Social Security Act to revise the requirements and the formula for payments for services, including an implantable medical device, furnished to individuals in ambulatory surgical centers. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building".

HR 2860 - Health Care Access and Rural Equity (H-CARE) Act of 2007, Title 2, Section 201 which calls for coverage of marriage and family therapist services and mental health counselor services under Part B of the Medicare Program. HR 3162 - Children's Health and Medicare Protection Act of 2007, Subtitle A, Section 607 which relates to coverage for marriage and family therapist services and mental health counselor services. S. 498 - Rural Medicare Equity Act of 2007 - legislation calls for improvement of the Medicare program for beneficiaries residing in rural areas S. 1605 - Craig Thomas Rural Hospital and Provider Equity Act of 2007, Section 16 which would provide coverage of marriage and family therapist services and mental health counselor services under Part B of the Medicare Program. HR 820 - To amend title XVIII of the Social Security Act to provide for the coverage of marriage and family therapist services under Part B of the Medicare Program, and for other purposes. HR 1663 - Title 3, Sec. 302. Coverage of marriage and family therapist services. To amend title XVIII of the Social Security Act to expand and improve coverage of mental health services under the Medicare Program. S. 2708 - Caring for An Aging America Act of 2008, Section 771 - Geriatric and Gerontology Loan Repayment Program

Client expense: Not reported · Firm income: $30,000

S.3: Medicare Prescription Drug Price Negotiation Act of 2007 S.158: Access to Affordable Health Care Act S. 273: Prescription Drug and Health Improvement Act of 2007 S. 290: Rural Physicians Relief Act of 2007 S. 334: Healthy Americans Act S. 397: Tax Equity and Affordability Act of 2007 S. 498: Rural Medicare Equity Act of 2007 S. 1342: HeLP America Act S. 1605: Craig Thomas Rural Hospital and Provider Equity Act of 2007 S. 1710: Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act, 2008 S. 2785: Save Medicare Act of 2008 S. 2603: Medicare Fraud Prevention Act of 2008 S. 2687: Medicare Beneficiary Protection Act of 2008 S. 2786: Medicare Rural Health Access Improvement Act of 2008 H.R.4: Medicare Prescription Drug Price Negotiation Act of 2007 H.R.15: National Health Insurance Act H.R.118: To amend part D of title XVIII of the Social Security Act to authorize the Secretary of Health and Human Services to negotiate prices for part D covered drugs for Medicare beneficiaries. H.R.205: Medicare Prescription Drug Enrollment Extension Act of 2007 H.R.298: Flexible Spending Accounts Growth and Opportunities Act of 2007 HR 914: Tax Equity and Affordability Act of 2007 H.R. 1651: Rural Health Quality Advisory Commission Act of 2007 HR 2056: Medicare Part D Improvement Act of 2007 HR 2633: HeLP America Act (Introduced in House) HR 2860: Health Care Access and Rural Equity (H-CARE) Act of 2007 HR 3014: Health Equity and Accountability Act of 2007 H.R. 3043: Department of Health and Human Services Appropriations Act, 2008 HR 3163: Healthy Americans HR 4848: To extend for one year parity in the application of certain limits to mental health benefits, and for other purposes HR 1424: Paul Wellstone Mental Health and Addiction Equity Act of 2007 HR 5445: To amend part B of title XVIII of the Social Security Act to increase Medicare payments for physicians' services through December 31, 2009.

HR 2860 - Health Care Access and Rural Equity (H-CARE) Act of 2007, Title 2, Section 201 which calls for coverage of marriage and family therapist services and mental health counselor services under Part B of the Medicare Program. HR 3162 - Children's Health and Medicare Protection Act of 2007, Subtitle A, Section 607 which relates to coverage for marriage and family therapist services and mental health counselor services. S. 498 - Rural Medicare Equity Act of 2007 - legislation calls for improvement of the Medicare program for beneficiaries residing in rural areas S. 1605 - Craig Thomas Rural Hospital and Provider Equity Act of 2007, Section 16 which would provide coverage of marriage and family therapist services and mental health counselor services under Part B of the Medicare Program. HR 820 - To amend title XVIII of the Social Security Act to provide for the coverage of marriage and family therapist services under Part B of the Medicare Program, and for other purposes. HR 1663 - Title 3, Sec. 302. Coverage of marriage and family therapist services. To amend title XVIII of the Social Security Act to expand and improve coverage of mental health services under the Medicare Program.

Client expense: Not reported · Firm income: $30,000

Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 70) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits. S 2499, the Medicare, Medicaid and SCHIP Extension act of 2007. Supported provisions that prevent the 10.1% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.1% cut with a 0.5% increase but only through June 30, 2008. S 2499 also extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 -- also only through June 30. Marshfield Clinic nominated Dr. Douglas Reding for an open position on the Medicare Payment Advisory Commission, and sought the endorsement of the Wisconsin delegation, and other Senators and Representatives that serve on the Committees with jurisdiction over the Medicare program. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Support for S.2785, the Save Medicare Access Act of 2008, introduced by Sen. Debbie Stabenow. It would avert the 10.6% cut to physician payments scheduled to take effect in July and the additional cut of 5% or more scheduled in January 09. Payments would continue at their current rate through the remainder of 2008 and then would rise by 1.8% in 2009. The current work GPCI floor and physician scarcity bonus would also be continued through the end of 2009. Pay-for Reporting and Performance Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. Support for Medicare Rural Health Access Improvement Act, S 2786, introduced by Senator Chuck Grassley especially provisions that would extend the 1.0 work floor through December 31,2009, and would recognize the equality of physician work in all geographic areas and eliminate differing work index values by establishing a national value of 1.0, effective 2010. Also support provisions for physician practice expense that would establish a practice expense floor of 1.0 for 2009 by requiring the Secretary to increase the value of any practice expense geographic index that was below 1.0 to 1.0 for services furnished on or after January 1, 2009 and before January 1, 2010. Subsection (b) would reduce the geographic adjustment for practice expense to 50 percent of the current adjustment for employee wages and rent, effective 2010. Support for Rep. Ron Kinds concept of a not yet introduced MEDICARE EFFICIENCY BILL that would amend the CHAMP Act (H.R. 3162) 304 in whole, by establishing that the 5% bonus payment would be expanded to the top 10% of efficient counties; and a corresponding 5% efficiency penalty for physicians in the bottom 10% of efficient counties. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Subtitle C: Other Provisions - (Sec. 626) Provides that in FY 2004, starting April 1, 2004, the ambulatory surgery center (ASC) update will be the Consumer Price Index for all urban consumers (U.S. city average) as estimated as of March 31, 2003, minus 3.0 percentage points. Provides that in FY 2005, the last quarter of calendar year 2005, and each of calendar years 2006 through 2009, the ASC update will be zero percent. Provides that subject to recommendations by the General Accounting Office, the Secretary will implement a revised payment system for payment of surgical services furnished in ASCs. Requires the new system to be implemented so that it is first effective on or after January 1, 2006, and not later than January 1, 2008. Requires the Comptroller General to conduct a study for a report to Congress that compares the relative costs of procedures furnished in ambulatory surgical centers to the relative costs of procedures furnished in hospital outpatient departments. (Sec. 628) Provides that there will be no updates to the clinical diagnostic laboratory test fee schedule for 2004 through 2008. Subtitle D: Additional Demonstrations, Studies, and Other Provisions - (Sec. 649) Directs the Secretary to establish a pay-for-performance demonstration program with physicians to meet the needs of eligible beneficiaries through the adoption and use of health information technology and evidence-based outcomes measures Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Also supports efforts to eliminate the 2% threshold for payments and the 5% limitation on payments. Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 H.R.1823 Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 introduced by Rep. Wally Herger and Kendrick Meek - Amends title XVIII (Medicare) of the Social Security Act to revise the requirements and the formula for payments for services, including an implantable medical device, furnished to individuals in ambulatory surgical centers. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building".

S. 498, "Rural Medicare Equity Act of 2007," provisions related to MedPAC representation and payment issues for rural providers H.R. 1730, "MedPAC Rural Representation Act," bill relates to MedPAC representation S. 2499, "SCHIP, Medicaid, and SCHIP Extension Act of 2007" S.1605, "Craig Thomas Rural Hospital and Provider Equity Act of 2007," all provisions relating to provider payments in rural areas H.R. 2860, "Health Care Access and Rural Equity (H-CARE) Act of 2007," all provisions relating to provider payments in rural areas H.R. 3162, "Children's Health and Medicare Protection (CHAMP) Act of 2007," provisions relating to provider payments in rural areas, SCHIP, hospital payments and a physician payment fix S. 1893/H.R. 976, "Children's Health Insurance Program Reauthorization Act of 2007," provisions relating to SCHIP reauthorization and to expanded outreach for rural children S. 1310, "Medicare Ambulance Payment Extension Act," provisions relating to rural amublance providers H.R. 2164, "Medicare Ambulance Payment Extension Act," provisions relating to rural ambulance providers S. 630, "Rural Health Services Preservation Act of 2007," provisions requiring MA organizations to pay a fair rate to RHC and CAHs H.R. 1563, "Rural Health Services Preservation Act of 2007," provisions requiring MA organizations to pay a fair rate to RHC and CAHs H.R. 2159, "Rural Health Services Preservation Act of 2007," provisions requiring MA organizations to pay a fair rate to RHC and CAHs

Client expense: $20,000 · Firm income: Not reported

Subtitle D: Additional Demonstrations, Studies, and Other Provisions - (Sec. 649) Directs the Secretary to establish a pay-for-performance demonstration program with physicians to meet the needs of eligible beneficiaries through the adoption and use of health information technology and evidence-based outcomes measures Deficit Reduction Act (Section 5102) reduced reimbursements for multiple images on contiguous body parts in 2006; the DRA provision created in statute a basis for payment reductions on the imaging of contiguous body parts that CMS implemented through the rulemaking process in 2005; the DRA also requires that payment rates for imaging services delivered in physician offices do not exceed payment rates for identical imaging services delivered in hospital outpatient departments beginning in 2007. Clinic recommends that Congress repeal Section 5102, and direct MedPAC and CMS to conduct a comprehensive study of imaging and the geographic variation in services to determine where growth in the volume of imaging services is appropriate and develop workable solutions to control inappropriate imaging utilization. Medicare Provisions in the Tax Relief and Health Care Act of 2006 (HR 6111) Increases payments for physician services and implements a quality reporting system for physician services. Prevents physician payment cuts in 2007 by freezing payment rates for physician services. Provides a 1.5 percent bonus-incentive payment to physicians who report on quality measures in 2007. Establishes a $1.3 billion fund to promote physician payment stability and physician quality initiatives in 2008. Extends the Medicare Modernization Act (MMA) floor on the Medicare work geographic adjustment for physician services. Establishes a floor on the work component of the physician geographic adjustor in 2007 to raise payments in certain rural areas. CMS Physician Group Practice Demonstration On September 27, 2002 the Centers for Medicare and Medicaid Services published a notice in the Federal Register informing interested parties of an opportunity to submit proposals for participation in the Medicare Physician Group Practice Demonstration (PGP) project to test a hybrid payment methodology that combines Medicare fee-for-service payments with a bonus pool derived from savings achieved by improvements in patient care management. Marshfield Clinic submitted a proposal for this demonstration and was selected by CMS to participate in the demonstration program, effective April 1, 2005. Marshfield Clinic supported CMS determination to extend this program, beyond its initial 3-year term. Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 H.R.1823 Ambulatory Surgical Center Medicare Payment Modernization Act of 2007 introduced by Rep. Wally Herger and Kendrick Meek - Amends title XVIII (Medicare) of the Social Security Act to revise the requirements and the formula for payments for services, including an implantable medical device, furnished to individuals in ambulatory surgical centers. Regulatory clarification of Medicare anti-markup issues, and postponement of the effective date of CMS final rule regarding the applicability of the anti markup provisions with respect to: (1) the technical component of a purchased diagnostic test and (2) any anatomic pathology diagnostic testing services furnished in space that is utilized by a physician group practice as a "centralized building" for purposes of complying with the physician self-referral rules and does not qualify as a "same building". Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Public Law No: 108-173: Title II: Medicare Advantage -- (Sec. 211) Revises the payment system, requiring all plans to be paid at a rate at least as high as the rate for traditional Medicare fee-for-service plans. Makes change in budget neutrality for blended payments. Increases minimum percentage increase to national growth rate. Marshfield Clinic opposes reductions to Medicare Advantage payments in low payment states. Subtitle D: Additional Reforms - (Sec. 237) Provides that Federally Qualified Health Centers (FQHCs) will receive a wrap-around payment for the reasonable costs of care provided to Medicare managed care patients served at such centers. Raises reimbursements to FQHCs in order that when they are combined with MA payments and cost-sharing payments from beneficiaries they equal 100 percent of the reasonable costs of providing such services. Extends the safe harbor to include any remuneration between a FQHC (or entity controlled by an FQHC) and an MA organization. Title IV: Rural Provisions - Subtitle B: Provisions Relating to Part B Only - (Sec. 412) Directs the Secretary to increase the work geographic index to 1.00 for any locality for which such work geographic index is less than 1.00 for services furnished on or after January 1, 2004, and before January 1, 2007. Since this provision expires at the end of 2006 it must be extended or revised. See Tax Relief and Health Care Act provisions below (Sec. 413) Establishes a new five percent incentive payment program designed to reward both primary care and specialist care physicians for furnishing physicians' services on or after January 1, 2005, and before January 1, 2008 in physician scarcity areas. Directs the Secretary to pay the current law ten percent Health Professional Shortage Area (HPSA) incentive payment for services furnished in full county primary care geographic area HPSAs automatically rather than having the physician identify the health professional shortage area involved. Title VI: Provisions Relating to Part B - Subtitle A: Provisions Relating to Physicians' Services (Sec. 605) Requires the Secretary to review and consider alternative data sources than those currently used to establish the geographic index for the practice expense component under the Medicare physician fee schedule no later than January 1, 2005. Requires the Secretary to select two physician payment localities for such purposes, one to be a rural area and the other one will be a statewide locality that includes both urban and rural areas. Subtitle C: Other Provisions - (Sec. 626) Provides that in FY 2004, starting April 1, 2004, the ambulatory surgery center (ASC) update will be the Consumer Price Index for all urban consumers (U.S. city average) as estimated as of March 31, 2003, minus 3.0 percentage points. Provides that in FY 2005, the last quarter of calendar year 2005, and each of calendar years 2006 through 2009, the ASC update will be zero percent. Provides that subject to recommendations by the General Accounting Office, the Secretary will implement a revised payment system for payment of surgical services furnished in ASCs. Requires the new system to be implemented so that it is first effective on or after January 1, 2006, and not later than January 1, 2008. Requires the Comptroller General to conduct a study for a report to Congress that compares the relative costs of procedures furnished in ambulatory surgical centers to the relative costs of procedures furnished in hospital outpatient departments. (Sec. 628) Provides that there will be no updates to the clinical diagnostic laboratory test fee schedule for 2004 through 2008. Information Technology Under current law the capital and operating expenses of installing and maintaining an electronic medical record are assumed to be part of the overhead expense of a medical practice. Since no more than 5 10% of the physician population has installed EMRs, CMS measurement of current physician practice expenses reflect minimal expense associated with IT. Congress should provide incentives for EMR adoption, and should establish standards to facilitate the sharing and exchange of data. S. 1693, the Wired for Health Care Quality Act introduced by Senator Ted Kennedy (D-MA) and Michael Enzi (R-WY) - Amends the Public Health Service Act to establish the Office of the National Coordinator of Health Information Technology to coordinate and oversee programs and activities to develop a nationwide interoperable health information technology infrastructure. Payment Fairness for Practice Costs The formulas by which Medicares payments are calculated are widely variable throughout Medicare localities, and are based upon outdated data assumptions regarding the cost and organization of medical practice. Alternatives: CMS should administratively revise its measurements of the costs of practice to assure the validity and fairness of payments; a payment floor could be established for practice expense; or the present variation (.705 1.501) in practice expense could be channeled into a narrower corridor of adjustment. Payment Equity Before MMA 03, Medicares payments were geographically adjusted based upon erroneous assumptions about the cost of hiring and retaining physicians. Congress established a floor payment mechanism for the physician work component of Medicare payment for 04 07 to assure that physicians in low payment localities were compensated for their work at least at the national average payment amount. This payment floor should be extended indefinitely or geographic adjustment of work should be eliminated entirely. The Rural Medicare Equity Act of 2007 (S 498), introduced by Senator Russ Feingold, Amends title XVIII (Medicare) of the Social Security Act (SSA) to eliminate the geographic physician work adjustment factor from the geographic indices used to adjust payments under the physician fee schedule. Rep. Braley introduced HR 2827, the Medicare Equity and Accessibility Act, along with Rep. Adrian Smith (R-Nebraska). This bill will increase the Medicare Part B reimbursement rates in Iowa and other rural states, by making permanent the 1.0 floor on the Geographic Practice Indexes for Work and Practice Expense. S 2499, the Medicare, Medicaid and SCHIP Extension act of 2007. Supported provisions that prevent the 10.1% cut in Medicare physician payment that was called for in the November 27, 2007 CMS final rule implementing the Medicare physician fee schedule. The bill replaces the 10.1% cut with a 0.5% increase but only through June 30, 2008. S 2499 also extended the 1.0 floor on the geographic adjustor for physician work initially included in the Medicare Modernization Act of 2003 -- also only through June 30. Sustainable Growth Rate Medicares SGR mechanism unfairly links physician payment updates to factors unrelated to patients needs and the cost of providing patient care. Reform proposals include reimbursement updated on a market basket basis, removal of prescription drugs from the calculation of Medicare Part B costs, and rebasing Part B to reflect current rather than cumulative costs. Pay-for Reporting and Performance Currently the prevailing methods of paying for health care in the US neither incent nor reward providing high quality care. The rising costs of care coupled with the increasing awareness of poor quality care have made clear the need for a transformation in the way health care is financed. In the fee-for-service system Medicare currently reimburses for units of service, in a manner that promotes service utilization without regard to quality. This has had the unanticipated, but now recognized effect of economically stimulating growth in the numbers of services provided by physicians. Medicare must implement quality based payments for physician services, and capture the data on performance measures utilizing available claims-based data recoverable through enhanced IT functions. In 2005, the Centers for Medicare and Medicaid Services (CMS) proposed the Physicians Voluntary Reporting Program (PVRP). In late 2006 CMS renamed PVRP the Physicians Quality Reporting Initiative. (PQRI) In the PQRI program CMS calls on physicians to report on evidence-based performance measures selected with input from the National Quality Forum, the Ambulatory Care Quality Alliance, and the National Committee for Quality Assurance, (NCQA). For reporting purposes physicians will utilize provisional G- Codes developed by CMS to indicate whether a patient received a service, did not receive the service, was not a eligible candidate to receive the service, or would not be considered a patient under the care of the physician at the time of the service. Marshfield Clinic has recommended that CMS allow medical groups to electronically report quality measures in an aggregated, periodic, statistically valid basis to PQRI; and re-focus the PQRI on high cost/high volume disease states. Marshfield Clinic supports a request for CMS authorization and funding for a multi-center demonstration project with access to vast data resources across multiple states. This proposed project will connect treatments with outcomes and develop quality metrics that reflect the realities of the care setting and the severity of the patients illness. Provisions of the Presidents FY2008 Budget and related appropriations legislation (S Con Res 21) related to implementation of the Medicare Advantage and Prescription Drug Programs, the provision of Medicare and Medicaid services and benefits to patients, incentives to promote electronic health records for all Americans, and prescription drug benefits.

S. 334: Healthy Americans Act - Entire bill S. 397: Tax Equity and Affordability Act of 2007 - Entire bill S. 498: Rural Medicare Equity Act of 2007 - Entire bill S. 1342: HeLP America Act - Entire bill S. 1605: Craig Thomas Rural Hospital and Provider Equity Act of 2007- Entire bill S. 1710: Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act, 2008 - Entire bill H.R.4: Medicare Prescription Drug Price Negotiation Act of 2007 - Entire bill H.R.15: National Health Insurance Act - Entire bill H.R.118: To amend part D of title XVIII of the Social Security Act to authorize the Secretary of Health and Human Services to negotiate prices for part D covered drugs for Medicare beneficiaries. - Entire bill H.R.205: Medicare Prescription Drug Enrollment Extension Act of 2007 - Entire bill H.R.298: Flexible Spending Accounts Growth and Opportunities Act of 2007 - Entire bill HR 914: Tax Equity and Affordability Act of 2007 - Entire bill H.R. 1651: Rural Health Quality Advisory Commission Act of 2007 - Entire bill HR 2056: Medicare Part D Improvement Act of 2007 - Entire bill HR 2633: HeLP America Act (Introduced in House) - Entire bill HR 2860: Health Care Access and Rural Equity (H-CARE) Act of 2007 - Entire bill HR 3014: Health Equity and Accountability Act of 2007 - Entire bill H.R. 3043: Department of Health and Human Services Appropriations Act, 2008 - Entire bill HR 3163: Healthy Americans Act - Entire bill S. 3 - Medicare Prescription Drug Price Negotiation Act of 2007. - Entire bill S. 158 - Access to Affordable Health Care Act. - Entire bill S. 273 - Prescription Drug and Health Improvement Act of 2007. - Entire bill S. 290 - Rural Physicians Relief Act of 2007. - Entire bill

Client expense: $1,950,959 · Firm income: Not reported

Advocated for inclusion of Amendment to Iraq Supplemental Spending Bill one year moratorium of rule limiting UPL Payments to public hospitals. H.R. 2206 - U.S. Troop Readiness, Veterans' Care, Katrina Recovery and Iraq Accountability Appropriations Act of 2007. Advocated for S. 1224 - The Children's Health Insurance Program Reauthorization Act of 2007-all provisions. Advocated for H.R. 1459/S. 543 - to improve Medicare beneficiary access by extending the 60% compliance threshold used to determine whether a hospital or unit of a hospital is an impatient rehabilitation facility. Opposed 2.4% cut in Medicare payments to hospitals as proposed in CMS-1533-P. Supported H.R. 2860 - The Health Care Access and Rural Equity Act. Supported S. 498 - The Rural Medicare Equity Act of 2007. Advocated for inclusion of Amendment to Iraq Supplemental Spending Bill one year moratorium of rule limiting UPL Payments to public hospitals. H.R. 2206 - U.S. Troop Readiness, Veterans' Care, Katrina Recovery and Iraq Accountability Appropriations Act of 2007.

Client expense: $137,000 · Firm income: Not reported

Government targets: Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, SENATE

Advocated for H.R. 1459/S. 543 - to improve Medicare beneficiary access by extending the 60% compliance threshold used to determine whether a hospital or unit of a hospital is an impatient rehabilitation facility. Opposed 2.4% cut in Medicare payments to hospitals as proposed in CMS-1533-P. Supported H.R. 2860 - The Health Care Access and Rural Equity Act. Supported S. 498 - The Rural Medicare Equity Act of 2007. Advocated for inclusion of Amendment to Iraq Supplemental Spending Bill one year moratorium of rule limiting UPL Payments to public hospitals. H.R. 2206 - U.S. Troop Readiness, Veterans' Care, Katrina Recovery and Iraq Accountability Appropriations Act of 2007. Advocated for S. 1224 - The Children's Health Insurance Program Reauthorization Act of 2007-all provisions.

Client expense: $137,000 · Firm income: Not reported

Government targets: Centers For Medicare and Medicaid Services (CMS), HOUSE OF REPRESENTATIVES, SENATE

S. Con. Res. 21, 2008 Federal Budget Resolution, Budget resolutions would include funding for Medicare payments to physicians, Children’s health insurance program and Health Professions Grants for Family Medicine Training. S. 290, Rural Physicians’ Relief Act, The bill would provide primary care physicians with a $1000 tax credit for each month she provided services in a designated “frontier” area. S. 498, Rural Medicare Equity Act, The bill would provide additional support payments for physicians in rural areas. S. 558, Paul Wellstone Mental Health Equitable Treatment Act, The bill would require insurers offering mental health coverage impose financial requirements for mental health benefits that are no more restrictive than those applied to other medical benefits. S. 588, The Resident Physician Shortage Reduction Act of 2007, Increase the number of residency slots in rural areas. S. 1218, Medicare for All, The bill would extend Medicare coverage to all Americans who are not otherwise covered by health insurance. S. 1224, Children’s Health Insurance Program Reauthorization Act, The bill extends the Children’s Health Insurance Program; the House version should include Medicare physician payment provisions. S. 1710, 2008 Labor, HHS, and Education Appropriations Act, The bill would fund grants for health professions development programs and the Agency for Healthcare Research and Quality. S. 1307, Medicare Provider Accountability Act, The bill would have CMS withhold Medicare payments from providers who owe federal taxes. H. Con. Res. 99, 2008 Federal Budget Resolution, Budget resolutions would include funding for Medicare payments to physicians, Children’s health insurance program and Health Professions Grants for Family Medicine Training. HR 1424, Paul Wellstone Mental Health Equitable Treatment Act, The bill would require insurers offering mental health coverage impose financial requirements for mental health benefits that are no more restrictive than those applied to other medical benefits. HR 1591, FY 2007 Supplemental Spending Act, The bill would provide funding to cover the SCHIP shortfall, delay proposed Medicaid rules on GME and IGTs, require the use of tamper-proof prescription pads, and fund flu pandemic preparation and response efforts. HR 1730, The Rural Medicare Equity Act, Increase rural representation on MedPAC. HR 1781, Children’s Health Insurance Program Reauthorization Act, The bill extends the Children’s Health Insurance Program; the House version should include Medicare physician payment provisions. HR 2034, Medicare for All, The bill would extend Medicare coverage to all Americans who are not otherwise covered by health insurance. HR 2206, FY 2007 Supplemental Spending Act, The bill would provide funding to cover the SCHIP shortfall, delay proposed Medicaid rules on GME and IGTs, require the use of tamper-proof prescription pads, and fund flu pandemic preparation and response efforts. HR 2860, Health Care Access and Rural Equity (H-CARE) Act of 2007, Improve Medicare payment and access. HR 3038, Medicare Physician Payment Reform Act of 2007, Revise the sustainable growth rate formula. HR 3043, 2008 Labor, HHS, and Education Appropriations Act, The bill would fund grants for health professions development programs and the Agency for Healthcare Research and Quality. No Bill Number, Graduate Medical Education Funding Formula, Interpret “all or substantially all.” No Bill Number, Children’s Health and Medicare Protection Act of 2007, Revise the Medicare SGR formula. No Bill Number, Voluntary Medicare Quality Reporting Act of 2007, Stop the physician quality reporting initiative.

S. Con. Res. 21, 2008 Federal Budget Resolution, Budget resolutions would include funding for Medicare payments to physicians, Children’s health insurance program and Health Professions Grants for Family Medicine Training. S. 290, Rural Physicians’ Relief Act, The bill would provide primary care physicians with a $1000 tax credit for each month she provided services in a designated “frontier” area. S. 334, Healthy Americans Act, The bill would create tax credits for health insurance. S. 358, Genetic Information Nondiscrimination Act, The bill would prohibit genetic discrimination by employers and health insurance providers. S. 498, Rural Medicare Equity Act, The bill would provide additional support payments for physicians in rural areas. S. 558, Paul Wellstone Mental Health Equitable Treatment Act , The bill would require insurers offering mental health coverage impose financial requirements for mental health benefits that are no more restrictive than those applied to other medical benefits. S. 624, National Breast and Cervical Cancer Early Detection Program Reauthorization Act, The bill would reauthorize programs for subsidized mammography exams, PAP tests, and other screenings. S. 625, Family Smoking Prevention and Tobacco Control Act, The bill would allow the Food and Drug Administration to regulate tobacco products. AAFP supports this from a public health perspective. S. 634, Newborn Screening Saves Lives Act of 2007, Authorize HRSA grants for education and training in newborn screening for congenital, genetic, and metabolic disorders. S. 657, Trauma Care Systems Planning and Development Act, The bill would authorize several emergency services and trauma care programs. S. 1066, Medical Education Affordability Act, Medical student loan debt relief. S. 1218, Medicare for All, The bill would extend Medicare coverage to all Americans who are not otherwise covered by health insurance. S. 1224, Children’s Health Insurance Program Reauthorization Act, The bill extends the Children’s Health Insurance Program; the House version should include Medicare physician payment provisions. S. 1481, Fair and Reliable Medical Justice Act, Medical liability reform. S. 1693, Wired for Health Care Quality Act, The bill would provide grants to physician practices to implement health information technology. S. 1710, 2008 Labor, HHS, and Education Appropriations Act, The bill would fund grants for health professions development programs and the Agency for Healthcare Research and Quality. H. Con. Res. 99, 2008 Federal Budget Resolution, Budget resolutions would include funding for Medicare payments to physicians, Children’s health insurance program and Health Professions Grants for Family Medicine Training. HR 140, US. Physician Shortage Elimination Act, The bill would provide scholarships and tuition assistance for family medicine students and grants for physicians who practice in community health centers. HR 477, Stroke Treatment and Ongoing Prevention Act, The bill would authorize several programs related to education, prevention and treatment of stroke and to encourage the use of telemedicine. HR 493, Genetic Information Nondiscrimination Act, The bill would prohibit genetic discrimination by employers and health insurance providers. HR 727 (PL110-23), Trauma Care Systems Planning and Development Act, The bill would authorize several emergency services and trauma care programs. HR 1108, Family Smoking Prevention and Tobacco Control Act, The bill would allow the Food and Drug Administration to regulate tobacco products. AAFP supports this from a public health perspective. HR 1132 (PL110-18), National Breast and Cervical Cancer Early Detection Program Reauthorization Act, The bill would reauthorize programs for subsidized mammography exams, PAP tests, and other screenings. HR 1332, Small Business Lending Improvements Act, The bill would provide special loan incentives to encourage medical professionals to locate in designated shortage areas. HR 1368, Personalized Health Information Act, The bill would require HHS to establish a program to provide financial incentives for the establishment of interactive personal health records for Medicare beneficiaries. HR 1424, Paul Wellstone Mental Health Equitable Treatment Act , The bill would require insurers offering mental health coverage impose financial requirements for mental health benefits that are no more restrictive than those applied to other medical benefits. HR 1591, FY 2007 Supplemental Spending Act, The bill would provide funding to cover the SCHIP shortfall, delay proposed Medicaid rules on GME and IGTs, require the use of tamper-proof prescription pads, and fund flu pandemic preparation and response efforts. HR 1781, Children’s Health Insurance Program Reauthorization Act, The bill extends the Children’s Health Insurance Program; the House version should include Medicare physician payment provisions. HR 2034, Medicare for All, The bill would extend Medicare coverage to all Americans who are not otherwise covered by health insurance. HR 2206, FY 2007 Supplemental Spending Act, The bill would provide funding to cover the SCHIP shortfall, delay proposed Medicaid rules on GME and IGTs, require the use of tamper-proof prescription pads, and fund flu pandemic preparation and response efforts. HR 2497, Fair and Reliable Medical Justice Act, Medical liability reform. HR 2580, Help Efficient, Accessible, Low-Cost, Timely Healthcare Act, The bill would cap non-economic damages that could be recovered in a medical malpractice lawsuits. HR 3043, 2008 Labor, HHS, and Education Appropriations Act, The bill would fund grants for health professions development programs and the Agency for Healthcare Research and Quality. No Bill Number, Title VII health professions programs reauthorization, Enhance Family Medicine training programs administered by the Health Resources and Services Administration. No Bill Number, Medicare physician payment reforms, Repeal Medicare Sustainable Growth Rate and provide positive annual updates of Medicare physician payment. No Bill Number, Medical Home, Place patient-centered medical home in legislation.