Practice expense debate rages on Capitol Hill

Implementation dates vary

Insiders expect to see the equivalent of a legislative shoot-out when the U.S. Senate and House try to reach a compromise between their widely divergent proposals for implementation of HCFA’s new practice expense formula.

HCFA’s proposed practice expense rule shifts physician practice expense payment from its historic cost basis to a relative value basis. The rule also corrects what HCFA sees as inflated payment rates for procedures performed in a hospital that typically are performed in a physician’s office. This site of service changes affects close to 7000 codes (see related stories on pp. 125-126).

Meanwhile, both supporters and opponents of the relative value unit-based practice expense concept are pulling out all stops to ensure Congress sees it their way. (See interviews with lead lobbyists for and against the practice expense proposal, p. 118.)

Congress plays referee

"No one likes to put Congress in the position of having to adjudicate a fight between warring factions of physicians," said Alan R. Nelson, MD, executive vice president of the Washington, DC-based American Society of Internal Medi cine (ASIM), when addressing the Senate Appropriations Committee. "Unfortunately, the way the debate has been framed so far forces Congress to choose between surgical specialists and primary care physicians."

There are two things on which most participants in the practice expense debate agree:

• There rule’s official implementation date will be postponed for one year until Jan. 1, 1999.

• The proposed rule and physician payment rates just released by HCFA will probably undergo at least one revision, and maybe more, before finally being implemented.

After that, key questions include: How long will it take to phase in the program? What kind—and amount of—additional study will HCFA be asked to do? Will Congress accept the so-called "down payment" proposal (backed by primary care physicians) that requires HCFA to institute a 10% transition to the new resource-based payment schedule starting next year, as required under the Senate Finance Committee bill?

"We strongly believe implementation of these changes will cause serious deterioration of the quality of care available to seniors. The data on which this [proposed] schedule is based are badly flawed and must be revisited," Jay Kleiman, MD, a cardiologist, told Congress last month.

"We don’t need another study to begin correcting inequities," responds ASIM’s Nelson. "I don’t believe any honest assessment of the issue could deny that the practice expenses of primary care services are undervalued and those of many surgical procedures are overvalued.

"We have no objection to including any additional data on actual costs, to the extent it is feasible to collect such data. But we are concerned about any language that could delay implementation of the final rule by requiring a massive and costly new study," stresses Nelson.