Re: Blue Cross Insurance for Locke Family Medicine

[Guest guest]

Sounds fine, just practical.

Doubt you'll get an answer...............

What % of your general pt base are on Anthem.

Matt in Western PA

1991 Medicare Rates - The Past is Present? --> was RE: [practicemgt] medicare non-participating

Perhaps this is what was referenced?

http://www.aafp.org/online/en/home/publications/news/news-now/archive/aafpacpaoa.html

Hedberg agreed. "After adjusting for practice costs, the Medicare pay to primary care physicians is about half what it was in 1991," he said. "The (SGR) formula is a disaster for primary care practices. Doctors have said they're unable to keep up with the constantly rising cost of running their primary care offices."

Of course, one could make the argument based on the graph in the handout at...

http://www.aafp.org/PreBuilt/Healthcare.pdf

If you really look at the graph, one could argue that the Medicare Payments in 2005 were the same as 1991 and the cost of giving Medicare care rose 35+% -- so, we have actually taken a 35% paycut since 1991.

Of course, if Medicare eventually does cut the fees 10%, then we will be 10% below 1991 rates (at least based on the graph) and a releative 45+% drop in the fee due to the increased cost of giving that care.

====================================================

Here is a letter from the AAFP -- it's a few years old and aimed at our congressman, but has the same points we have been getting out in the past.

http://www.aafp.org/PreBuilt/govphysfee.doc

Sample letter to the editor re: Medicare physician reimbursement cuts

[name of editor of letters section]

Editor

Letters to the Editor

[publication name

and address]

Dear Mr./Ms. [name of editor of letters section]:

Senior citizens and their physicians and other health care providers are facing a budget squeeze as never before, and it is affecting the ability of senior citizens to get the health care they need.

Using a deeply flawed formula, Medicare reimbursements to physicians were decreased 5.4 percent from last year. This decrease, the largest physician payment cut in the history of the Medicare program, is the result of a formula that is tied in part to the gross domestic product (GDP). Because the economy slowed substantially last year, the reimbursement rate was adjusted downward for 2002, even though GDP has no bearing on my practice costs or on the health care needs of my patients.

This cut is the fourth time in 11 years that Medicare physician payment rates have been reduced.

Forecasts made by the Centers for Medicare and Medicaid Services (CMS) now project reimbursement rates will be cut by a total 20 percent over the next four years. If this happens, payment rates in 2005 will be less than they were in 1991. No small business, my practice included, could expect to be viable after sustaining repeated payment cuts of that magnitude. It's time to repeal the flawed formula.

I urge Congress to move quickly to revise the complex formula and assure Medicare patients that their family physicians can afford to provide them the health care they need.

Sincerely,

[name]

Family Physician

[affiliation]

===================================================================

Scary stuff.

Locke, MD

[Guest guest]

I haven't calculated yet -- probably have <5% on Anthem...if that.

Locke, MD

From: [mailto: ] On Behalf Of Dr LevinSent: Sunday, January 06, 2008 7:27 AMTo: Subject: Re: Blue Cross Insurance for Locke Family Medicine

Sounds fine, just practical.

Doubt you'll get an answer...............

What % of your general pt base are on Anthem.

Matt in Western PA

1991 Medicare Rates - The Past is Present? --> was RE: [practicemgt] medicare non-participating

Perhaps this is what was referenced?

http://www.aafp.org/online/en/home/publications/news/news-now/archive/aafpacpaoa.html

Hedberg agreed. "After adjusting for practice costs, the Medicare pay to primary care physicians is about half what it was in 1991," he said. "The (SGR) formula is a disaster for primary care practices. Doctors have said they're unable to keep up with the constantly rising cost of running their primary care offices."

Of course, one could make the argument based on the graph in the handout at...

http://www.aafp.org/PreBuilt/Healthcare.pdf

If you really look at the graph, one could argue that the Medicare Payments in 2005 were the same as 1991 and the cost of giving Medicare care rose 35+% -- so, we have actually taken a 35% paycut since 1991.

Of course, if Medicare eventually does cut the fees 10%, then we will be 10% below 1991 rates (at least based on the graph) and a releative 45+% drop in the fee due to the increased cost of giving that care.

====================================================

Here is a letter from the AAFP -- it's a few years old and aimed at our congressman, but has the same points we have been getting out in the past.

http://www.aafp.org/PreBuilt/govphysfee.doc

Sample letter to the editor re: Medicare physician reimbursement cuts

[name of editor of letters section]

Editor

Letters to the Editor

[publication name

and address]

Dear Mr./Ms. [name of editor of letters section]:

Senior citizens and their physicians and other health care providers are facing a budget squeeze as never before, and it is affecting the ability of senior citizens to get the health care they need.

Using a deeply flawed formula, Medicare reimbursements to physicians were decreased 5.4 percent from last year. This decrease, the largest physician payment cut in the history of the Medicare program, is the result of a formula that is tied in part to the gross domestic product (GDP). Because the economy slowed substantially last year, the reimbursement rate was adjusted downward for 2002, even though GDP has no bearing on my practice costs or on the health care needs of my patients.

This cut is the fourth time in 11 years that Medicare physician payment rates have been reduced.

Forecasts made by the Centers for Medicare and Medicaid Services (CMS) now project reimbursement rates will be cut by a total 20 percent over the next four years. If this happens, payment rates in 2005 will be less than they were in 1991. No small business, my practice included, could expect to be viable after sustaining repeated payment cuts of that magnitude. It's time to repeal the flawed formula.

I urge Congress to move quickly to revise the complex formula and assure Medicare patients that their family physicians can afford to provide them the health care they need.

Sincerely,

[name]

Family Physician

[affiliation]

===================================================================

Scary stuff.

Locke, MD

[Guest guest]

Oh my , I did laugh at this letter. Sounds like a much clearer version of my inner musings. I've kept it, just in case I get fed up, to send to all my insurers :)NI haven't calculated yet -- probably have <5% on Anthem...if that.  Locke, MDFrom:  [mailto: ] On Behalf Of Dr LevinSent: Sunday, January 06, 2008 7:27 AMTo:  Subject: Re: Blue Cross Insurance for Locke Family MedicineSounds fine, just practical. Doubt you'll get an answer............... What % of your general pt base are on Anthem. Matt in Western PA 1991 Medicare Rates - The Past is Present? --> was RE: [practicemgt] medicare non-participatingPerhaps this is what was referenced? http://www.aafp.org/online/en/home/publications/news/news-now/archive/aafpacpaoa.html Hedberg agreed. "After adjusting for practice costs, the Medicare pay to primary care physicians is about half what it was in 1991," he said. "The (SGR) formula is a disaster for primary care practices. Doctors have said they're unable to keep up with the constantly rising cost of running their primary care offices." Of course, one could make the argument based on the graph in the handout at... http://www.aafp.org/PreBuilt/Healthcare.pdf If you really look at the graph, one could argue that the Medicare Payments in 2005 were the same as 1991 and the cost of giving Medicare care rose 35+% -- so, we have actually taken a 35% paycut since 1991. Of course, if Medicare eventually does cut the fees 10%, then we will be 10% below 1991 rates (at least based on the graph) and a releative 45+% drop in the fee due to the increased cost of giving that care.<265251317> ==================================================== Here is a letter from the AAFP -- it's a few years old and aimed at our congressman, but has the same points we have been getting out in the past. http://www.aafp.org/PreBuilt/govphysfee.doc Sample letter to the editor re: Medicare physician reimbursement cuts  [name of editor of letters section]EditorLetters to the Editor[publication nameand address] Dear Mr./Ms. [name of editor of letters section]: Senior citizens and their physicians and other health care providers are facing a budget squeeze as never before, and it is affecting the ability of senior citizens to get the health care they need. Using a deeply flawed formula, Medicare reimbursements to physicians were decreased 5.4 percent from last year. This decrease, the largest physician payment cut in the history of the Medicare program, is the result of a formula that is tied in part to the gross domestic product (GDP).  Because the economy slowed substantially last year, the reimbursement rate was adjusted downward for 2002, even though GDP has no bearing on my practice costs or on the health care needs of my patients. This cut is the fourth time in 11 years that Medicare physician payment rates have been reduced.Forecasts made by the Centers for Medicare and Medicaid Services (CMS) now project reimbursement rates will be cut by a total 20 percent over the next four years. If this happens, payment rates in 2005 will be less than they were in 1991.  No small business, my practice included, could expect to be viable after sustaining repeated payment cuts of that magnitude. It's time to repeal the flawed formula. I urge Congress to move quickly to revise the complex formula and assure Medicare patients that their family physicians can afford to provide them the health care they need. Sincerely,   [name]Family Physician[affiliation] =================================================================== Scary stuff.  Locke, MD  

[Guest guest]

, I think it was a good email –

good job not bowing to them!

From: [mailto: ] On Behalf Of Locke's in Colorado

Sent: Saturday, January 05, 2008

11:23 PM

To: Locke's in Colorado

Subject:

Blue Cross Insurance for Locke Family Medicine

Probably shouldn't have sent this e-mail to the Anthem rep while I was

in a foul mood about the recent insurance discussions...but did it anyway.

During my first conversaton with her at the end of November, her

comments were along the line of...

--- Insurance tagged to Medicare must not be a bad

deal -- most of our doctors accept it

--- Medicare hardly ever goes down on their fee

schedule

Well, I suppose she has to drink the Anthem Kool-Aid® if she works

for them, but please don't try to pass it over to me to drink.

Will be interesting to see if she writes me off and doesn't respond.

Locke, MD

From: Locke's

in Colorado

Sent: Saturday, January 05, 2008

11:17 PM

To: 'Ricke, Audra'

Cc: 'kelly@...';

'Locke's in Colorado'

Subject: Blue Cross Insurance for

Locke Family Medicine

Hi Audra,

It's been awhile since we spoke (see e-mail

below).

You had said it would be about a month, 6

weeks ago.

I would be interested in what Anthem can

offer.

Also, per our conversation about Medicare

never or rarely going down, it actually has gone down several times in the

past...see info below...And certainly hasn't kept pace with the cost of running

a business.

You can see why I am reluctant to take a

contract that ties my fees (essentially my salary) to Medicare.

I feel certain that you would not be

willing to accept a contract from Anthem that ties your salary to the annual

" increases " in Medicare fee schedules.

If so, you would sweat every year whether

congress would give you a Cost of Living raise -- not based on your

performance, but rather on some complicated calculation that you have no

control over.

Also, your yearly salary

" increases " since 1998 would have been...-5.3, 5.4, 4.5, -5.4, 1.6, 1.5, -4.5 = -0.7

Of course, your 10% pay CUT in salary for

the upcoming 2008 year would have been postponed and you would have received a

0.5% increase -- and been releived to get that!

Sorry to sound jaded, but the system is

dysfunctional and while many practices feel they can't afford to say no to poor

contracts, I can.

Anyway, let me know what Anthem can offer

and perhaps we can work out an agreement.

Thanks for your time,

Locke, MD

Locke Family Medicine

============================================================================================

From: Ricke,

Audra

Sent: Tuesday, November 27, 2007

9:45 AM

To: Locke's in Colorado

Cc: kelly@...

Subject: RE: Anthem BCB/HMOC - Information

Thank you so much for the attached and

below. I will see what I can do and get back with you early next month. Thanks

again.

Audra

K. Ricke

Anthem Blue Cross and Blue Shield

Network Representative/Provider Contracting

Phone: or x3140

Fax:

=====================================================================================

Per the recent article posted.

http://online.wsj.com/article/SB119732809319620055.html?mod=moj_columnis

I thought this link in the article was interesting -->

History of the conversion factor

http://www.ama-assn.org/ama1/pub/upload/mm/380/cfhistory.pdf

Since 1998, the Conversion Factor has done the following...

-5.3, 5.4, 4.5, -5.4, 1.6, 1.5, -4.5 = -0.7

See graphic below

Also of note, the Medicare Economic Index...The MEI was designed to measure

changes in costs of physician's time and operating expenses, adjusted for

changes in physician productivity.

http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=1944

The Medicare Physician Fee Schedule (MPFS) is updated on an

annual basis according to a formula specified by statute. The formula specifies

that the update for a year is equal to the Medicare Economic Index (MEI) adjusted

up or down depending on how actual expenditures compare to a target rate,

called the sustainable growth rate, or SGR. The SGR in turn is

calculated based on medical inflation, the projected growth in the domestic

economy, projected growth in the number of beneficiaries in fee-for-service

Medicare, and changes in law or regulation.

The MEI is a measure of inflation faced by physicians with

respect to their practice costs and general wage levels. The MEI

includes a bundle of inputs used in furnishing physicians’ services such

as physician’s own time, non-physician employees’ compensation,

rents, medical equipment, etc. The MEI measures year-to-year changes in

prices for these various inputs based on appropriate price proxies.

The economy-wide wage indices used in the MEI as a proxy

for changes in the wages of physicians and their employees already include an

adjustment for multi-factor productivity (MFP). If the MEI did not

net out either the MFP in the wage index proxy or the MFP in the outputs

furnished by physicians, it would effectively double-count productivity and

result in an overstatement of the MEI.

The MEI has gone up every year from what I can tell...

http://www.cms.hhs.gov/MedicareProgramRatesStats/downloads/mktbskt-economic-index.pdf

=========================================================

http://www.ama-assn.org/ama/pub/category/16397.html

The Medicare Conversion Factor

The Medicare conversion factor is a scaling factor that converts the

geographically adjusted number of relative value units (RVUs) for each service

in the Medicare physician payment schedule into a dollar payment amount. The

initial Medicare conversion factor was set at $31.001 in 1992. Subsequent conversion

factor updates have been based on three factors:

The Medicare economic index

An expenditure target “performance adjustment”

Miscellaneous adjustments including those for “budget neutrality”

===================================================

http://en.wikipedia.org/wiki/Medicare_(United_States)

Payment for physician services under Medicare has evolved

since the program was created in 1965. Initially, Medicare compensated

physicians based on the physician's charges, and allowed physicians to bill

Medicare beneficiaries the amount in excess of Medicare's reimbursement. In

1975, annual increases in physician fees were limited by the Medicare Economic Index (MEI). The MEI was

designed to measure changes in costs of physician's time and operating

expenses, adjusted for changes in physician productivity. From 1984 to 1991,

the yearly change in fees was determined by legislation. This was done because

physician fees were rising faster than projected.

The Omnibus Budget Reconciliation Act of 1989 made several

changes to physician payments under Medicare. Firstly, it introduced the

Medicare Fee Schedule, which took effect in 1992. Secondly, it limited the

amount Medicare non-providers could balance bill Medicare beneficiaries.

Thirdly, it introduced the Medicare Volume Performance Standards (MVPS) as a

way to control costs.[9]

On January

1, 1992,

Medicare introduced the Medicare Fee Schedule (MFS). The MFS assigned Relative

Value Units (RVUs) for each procedure from the Resource-Based Relative Value Scale

(RBRVS). The Medicare reimbursement for a physician was the product of the RVU

for the procedure, a Geographic Adjustment Factor (GAF) for geographic

variations in payments, and a global Conversion Factor (CF) which converts

RBRVS units to dollars.

From 1992 to 1997, adjustments to physician payments were adjusted

using the MEI and the MVPS, which essentially tried to compensate for the

increasing volume of services provided by physicians by decreasing their

reimbursement per service.

In 1998, Congress replaced the VPS with the Sustainable

Growth Rate (SGR). This was done because of highly variable payment rates under

the MVPS. The SGR attempts to control spending by setting yearly and cumulative

spending targets. If actual spending for a given year exceeds the spending

target for that year, reimbursement rates are adjusted downward by decreasing

the Conversion Factor (CF) for RBRVS RVUs.

Since 2002, actual Medicare Part B expenditures have

exceeded projections.

In 2002, payment rates were cut by 4.8%. In 2003, payment

rates were scheduled to be reduced by 4.4%. However, Congress boosted the

cumulative SGR target in the Consolidated Appropriation Resolution of 2003

(P.L. 108-7), allowing payments for physician services to rise 1.6%. In 2004

and 2005, payment rates were again scheduled to be reduced. The Medicare

Modernization Act (P.L. 108-173) increased payments 1.5% for those two years.

In 2006, the SGR mechanism was scheduled to decrease

physician payments by 4.4%. (This number results from a 7% decrease in

physician payments times a 2.8% inflation adjustment increase.) Congress

overrode this decrease in the Deficit Reduction Act (P.L. 109-362), and held

physician payments in 2006 at their 2005 levels. Without further continuing

congressional intervention, the SGR is expected to decrease physician payments from

25% to 35% over the next several years.

MFS has been criticized for not paying doctors enough

because of the low conversion factor. By adjustments to the MFS conversion

factor, it is possible to pay all doctors more or less depending on how much

money the person paying (CMS in this case) is willing to pay.[10]

=====================================

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From: Locke's

in Colorado

Sent: Tuesday, January 01, 2008

8:05 PM

To: Practice Management Issues

Subject: 1991 Medicare Rates - The

Past is Present? --> was RE: [practicemgt] medicare non-participating

Perhaps this is what was referenced?

http://www.aafp.org/online/en/home/publications/news/news-now/archive/aafpacpaoa.html

Hedberg agreed. " After adjusting for

practice costs, the Medicare pay to primary care physicians is about half what

it was in 1991, " he said. " The (SGR) formula is a disaster for

primary care practices. Doctors have said they're unable to keep up with the

constantly rising cost of running their primary care offices. "

Of course, one could make the argument

based on the graph in the handout at...

http://www.aafp.org/PreBuilt/Healthcare.pdf

If you really look at the graph, one could

argue that the Medicare Payments in 2005 were the same as 1991 and the cost of

giving Medicare care rose 35+% -- so, we have actually taken a 35% paycut since

1991.

Of course, if Medicare eventually does cut

the fees 10%, then we will be 10% below 1991 rates (at least based on the

graph) and a releative 45+% drop in the fee due to the increased cost of giving

that care.

====================================================

Here is a letter from the AAFP -- it's a

few years old and aimed at our congressman, but has the same points we have

been getting out in the past.

http://www.aafp.org/PreBuilt/govphysfee.doc

Sample

letter to the editor re: Medicare physician reimbursement cuts

[name of editor of letters section]

Editor

Letters to the Editor

[publication name

and address]

Dear Mr./Ms. [name of editor of letters

section]:

Senior citizens and their physicians and

other health care providers are facing a budget squeeze as never before, and it

is affecting the ability of senior citizens to get the health care they need.

Using a deeply flawed formula, Medicare

reimbursements to physicians were decreased 5.4 percent from last year. This

decrease, the largest physician payment cut in the history of the Medicare

program, is the result of a formula that is tied in part to the gross domestic

product (GDP). Because the economy slowed substantially last year, the

reimbursement rate was adjusted downward for 2002, even though GDP has no

bearing on my practice costs or on the health care needs of my patients.

This cut is the fourth time in 11 years

that Medicare physician payment rates have been reduced.

Forecasts made by the Centers for

Medicare and Medicaid Services (CMS) now project reimbursement rates will be

cut by a total 20 percent over the next four years. If this happens, payment

rates in 2005 will be less than they were in 1991. No small business, my

practice included, could expect to be viable after sustaining repeated payment

cuts of that magnitude. It's time to repeal the flawed formula.

I urge Congress to move quickly to revise

the complex formula and assure Medicare patients that their family physicians

can afford to provide them the health care they need.

Sincerely,

[name]

Family Physician

[affiliation]

===================================================================

Scary stuff.

Locke, MD