CMA Perspectives on Health Reform - Posted 7.2.2009

Fulfill the Promise of  Health Care for All  By Ensuring Access to a Doctor
With 6.7 million uninsured Californians, CMA believes expanding access to care is imperative for the healthy future of California.  CMA urges Congress to fulfill the promise of coverage for all by ensuring that all patients have a doctor.  California’s low Medi-Cal and Medicare payment rates have made it difficult for insured as well as uninsured Californians to find a doctor.  Federal health reform must provide every family with insurance and a doctor to care for them. 

CMA is also supporting efforts to reduce the rate of growth in health care spending by reducing unnecessary services, such as costly hospitalizations and ER visits. Health reform should incent appropriate care and protect the physician-patient relationship.

Assistance for Low-Income Families to Afford Health Insurance
CMA supports tax credits/subsidies to help low- moderate income families purchase coverage.

CMA supports some expansion of the Medicaid program for lower income families.  However, expanding Medicaid coverage does not guarantee access to a doctor.  California’s Medicaid rates are 44% below Medicare which have made it difficult for physicians to afford to care for Medicaid patients. As a result, 31% of ER visits are Medicaid patients.  Any Medicaid expansion must increase rates to Medicare levels so every Medicaid patient will have a doctor.   

Health Insurance Exchange – Choice and Market Fairness
CMA supports an exchange to give individuals a choice of health plans and physicians.

CMA supports an individual mandate to obtain coverage, if it is coupled with insurance reforms to make coverage more affordable.

Patients should be guaranteed that they will not lose coverage or be subject to premium hikes resulting from changes in health status or pre-existing conditions.

Medical decisions should be made by patients and their doctors.

Financing
Any reforms to the health care delivery system or expansions of coverage must be appropriately financed.  Significant public funding will be needed to support comprehensive health reform.
Any financing must be broad-based and not selectively imposed on the health care sector.

“Public” Health Insurance Plan Option
President Obama and Congressional Leaders are proposing a public government-run plan that would compete against the private health plans in the health insurance exchange.  While the public plan could increase choice and competition, CMA is concerned based on the historical financing record of Medicare and Medi-Cal. Some of our concerns include:
1.  Physician participation must be voluntary
2.  The Public Plan must compete on a level-playing field.  It must meet the same regulatory
requirements, market reforms and be financed solely through premiums.
3.  Enrollment must be limited to those who are currently uninsured.
4.  It must be adequately financed and pay competitive rates to protect access to doctors.
5.  Physicians must be allowed to privately contract with public plan enrollees.
6.  Physicians must be allowed to collectively negotiate with the plans.

Health Care Costs
CMA agrees that the status quo is not sustainable and we are willing to embrace change to reform the health care system. CMA concurs with the President – we must maintain what works and fix what is broken.  (See the CMA Medicare reform plan below.)
CMA supports reforms that incent the appropriate and efficient delivery of care.

CMA urges Congress to rebuild the foundation of primary and preventive care.
The proliferation of chronic disease must be managed and prevented. 

CMA advocates for an end to excessive health plan profit and overhead.  Health plans should dedicate at least 85% of their revenue to direct patient care.   

Medicare and Health Care Delivery System Reform
CMA has developed a plan to overhaul the broken Medicare payment system.  CMA believes it is crucial that the SGR formula be replaced with a stable, predictable physician payment system that appropriately updates rates based on physician practice cost increases.

Medicare physician payments lag 20% behind because rates have not kept pace with cost increases since 2002. For this reason, physicians have been unable to adequately invest in HIT and other innovations that improve care coordination and chronic disease management. 

More than 60% of California physicians said they would stop taking new Medicare patients or leave the program altogether if the rates are not updated.  Moreover, 48% of California physicians are over age 50, nearing retirement and curbing patient care services.  California will face a severe shortage of physicians if the program is not reformed. Seniors in California already report difficulties finding a doctor.

CMA Medicare Reform Principles
CMA is proposing a series of payment options depending on a physician’s mode of practice that appropriately realigns incentives.  Patient care coordination and management require investments in physician services, including HIT.  Physicians are eager to end the “Hamster Wheel of Volume” that has plagued the program and interfered with quality physician- patient relationships.

The CMA plan calls for

• The immediate elimination of the SGR
• A 10% catch-up rate increase for all services in 2010
• Annual payment updates based on medical practice cost inflation with appropriate utilization management
• At least 3% cumulative/annual increases for E&M primary care services
• A payment system that rewards coordination of care through both medical home management of patients, and Physician Accountable Care Organizations (ACOs) that incent physicians to collaborate and share in the hospital Part A savings achieved through their efforts to prevent unnecessary and costly hospitalizations.
• Allowing groups to directly contract with Medicare on a capitated basis.
• Private contracting with Medicare patients.