LEGISLATIVE ADVOCACY: Federal Update

Elizabeth McNeil

Note: These updates are excerpted from Ms. McNeil’s recent reports to the CMA board of trustees.

Medicare Payment Reform
A Medicare Geographic Payment Locality update for California was included in the Medicare SGR Patch legislation earlier this year. It will update the outdated Medicare payment localities across California, so that San Diego and Sacramento, for instance, will no longer be considered rural under the Medicare geographic payment formula. Starting in 2017, physicians in Marin County will experience a  Medicare rate increase of up to 10%. The rate increase will also positively impact all private contracts tied to the Medicare fee schedule and the Medicare Advantage rates.

Just as important, the legislation ensures that physicians practicing in California’s rural counties located in Medicare Locality 99 and Locality 3 do not receive corresponding payment cuts—as Medicare is a budget-neutral program. The legislation sets a floor so that rural physicians will never be cut below current geographic formula payment levels. If local practice costs increase, payments will increase—but they will never go below the 2014 floor.

Medicare SGR Reform
Earlier this year, Congress came close to passing comprehensive, bipartisan, bicameral legislation that repeals the Sustainable Growth Rate (SGR) formula and establishes a new physician payment system. It was approved by three committees of jurisdiction with the support of 600 national and state physician organizations. This was an unprecedented achievement.

Unfortunately, Congress ran out of time and the political will to finish the bill, so it adopted a short-term patch for the 17th time. The patches now cost more than the SGR reform legislation.

There remains a significant level of commitment from the committee leaders and others in Congress to resolve the budget issues and pass the bill. CMA is concerned that we are running out of time and will lose momentum in the next Congress. Therefore, CMA asks every member of Congress to urge their leadership to enact SGR reform.

The Medicare payment system must be fixed to meet the growing health care needs of California’s seniors. There are serious physician shortages in the state at a time when more seniors with complex chronic conditions need timely access to care. Fixing the Medicare payment system will provide stability, allow more physicians to remain in practice, and attract new physicians to our high-cost state. Because Medicare impacts all private payers in the state, SGR reform will improve access to care for all Californians.

Medicaid Rate Increases
Medicaid primary care physician reimbursement rates were increased to Medicare levels for two years starting in 2012. The increase applies to family physicians, internists, pediatricians, related internal medicine and pediatric subspecialties, and immunizations. Proposed legislation would extend the payment parity for two more years and add ob-gyn primary care services.

In California, the Medi-Cal reimbursement rates are almost the lowest in the nation—60% below Medicare rates. For that reason, two-thirds of California physicians cannot participate in Medi-Cal, and half of Medi-Cal patients cannot find a physician. With the Medicaid expansion, access to care is becoming a real crisis in California’s Medi-Cal program. Extending the rate increase creates strong incentives for physicians to remain in the program or boost the number of Medi-Cal patients they are able to treat. The legislation will protect access to care in California!

J-1 Visa Waivers
A CMA-sponsored provision (HR 2131) that doubles the number of J-1 Visa Waiver physicians in California passed the House Judiciary Committee earlier this year. It enjoys bipartisan support. However, the bill is stalled within the larger immigration reform package.

The Congressional Budget Office found that HR 2131 will add substantial additional revenue to the U.S. Treasury by bringing highly skilled physicians, engineers, scientists and tech professionals to the United States. The revenue-producing provisions will help secure HR 2131’s ultimate passage. Because of the revenue, HR 2131 is being tied to the larger, more controversial immigration reform package to help fund other costly provisions.
Unfortunately, immigration reform is dead in the House of Representatives. In the wake of the Eric Cantor upset in Virginia, the Republican Caucus cannot agree on a reform package. Despite the urging of CMA, the U.S. Chamber of Commerce and many others, the House will not pass piecemeal immigration-related bills. The Senate passed comprehensive bipartisan legislation earlier this year.

President Obama has announced that he will attempt to achieve immigration reform via executive order and regulations. The Administration is consulting with cabinet departments and members of Congress to develop the reform package. CMA is working with Congresswoman Zoe Lofgren (D-San Jose) to develop a J-1 Visa provision for the Administration. CMA will continue fighting to bring additional physicians to California.

Telemedicine Legislation
Several California members of Congress are introducing legislation to expand access to telemedicine services as a way of improving access to health care in the state’s underserved communities. Meanwhile, the telecom industry has entered the telemedicine debate and is vigorously pushing for national standards, national prescribing and national physician licensing laws. The industry’s lobbying firepower threatens to take the future of telehealth out of the hands of physicians.

CMA and AMA are involved with developing legislation that will see action later this year and in 2015. CMA and AMA support state-based medical licensure laws to protect patients. The telehealth bills threaten to undermine state law. As one alternative, AMA is working with the Federation of State Medical Boards to develop an Interstate Medical Licensure Compact for telemedicine purposes—but many details need to be worked out.

CMA physicians were also involved with developing the recent AMA House of Delegates report that establishes important principles for the future of telemedicine and will guide our positions on this legislation.
Below are summaries of proposed telemedicine legislation.

Online Pharmacy Act
CMA position: Oppose unless amended.
CMA is working with Sen. Diane Feinstein on draft legislation that would regulate online pharmacies. The bill also establishes a national definition of a valid prescription—who can prescribe and by what means. It would preempt state prescribing and telemedicine laws. CMA is opposed to the federal preemption. CMA worked with Sen. Feinstein on a similar piece of legislation in 2012 and successfully stopped it.

Telehealth Promotion Act
CMA is working closely with Rep. Mike Thompson (D-St. Helena) to refine his draft telemedicine legislation that would require parity for all services delivered via telehealth under Medicare, Medicaid, CHIP and federal employee health programs. It would allow out-of-state physicians to treat patients in California via telehealth and not be subject to California law. It also expands the list of providers eligible to deliver covered Medicare telehealth services.

Telemedicine for Medicare Act
CMA position: Oppose unless amended.
This bill would authorize the expansion of covered telemedicine services reimbursable by Medicare. It allows telemedicine to be practiced across state lines. Licensure would be based on the state in which the patient is located, rather than on the state in which the physician is licensed to practice. CMA is working with Rep. Devin Nunes (R-Tulare) to refine this legislation.

Care for Military and Veterans Act
CMA position: Oppose unless amended.
This legislation would authorize the expansion of covered telemedicine services for veterans to relieve the access-to-care crisis that veterans are now facing. The bill would also allow licensure to be based on the state in which the veteran is located rather than on the state in which the physician is licensed to practice. CMA is working with Rep. Scott Peters (D-San Diego) to refine this legislation.

Telehealth Modernization Act
CMA position: Support with amendments.
This legislation by Rep. Doris Matsui (D-Sacramento) establishes national principles for the delivery of telehealth, such as requiring that telehealth providers have access to the patient’s medical history, document the evaluation and treatment given to the patient, and generate a medical record for the visit. CMA supports these provisions. However, the bill would prohibit prescribing of controlled substances based on telehealth services, which is inconsistent with CMA policy.

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Ms. McNeil is CMA's vice president for federal government relations.
Email: emcneil@cmanet.org