May 27, 2005

MEMORANDUM

TO: Board of Directors

FR: Kevin J. Burke
Director, Division of Government Relations

CC: Doug Henley
Todd Dicus
Rosi Sweeney

RE: State and Federal Legislative Update (Week of May 23)

Graduate Medical Education

Senators Susan Collins (R-ME) and Dick Durbin (D-IL) continue to circulate a letter to be sent by the Senate to CMS administrator McClellan urging an administrative resolution to the volunteer faculty in residency training in non-hospital settings. As of today, 59 senators had agreed to cosign the letter. The letter recommends an extension of the moratorium and a collaborative effort to:

analyze the current financial arrangements among teaching hospitals, non hospital facilities, and supervisory physicians in those settings; and
study the potential impact of any revisions to the current policy; and clarify the definition of "all or substantially all" of the costs associated with training residents in non hospital settings.

Professional Liability

On Wednesday, May 25, three Democratic members of the House introduced a bill to provide comprehensive reform regarding medical malpractice (HR 2657) as a "common-sense compromise" to medical malpractice reform. The legislation, sponsored by Rep. Brian Baird (D-WA), would set inflation-adjusted limits on non-economic medical malpractice damages beginning at $878,000 this year, a larger sum than the $250,000 included in legislation previously passed in the House. The measure would require medical malpractice liability insurers to design and implement a plan to reduce premiums and would set sanctions for unmerited litigation and repeated filing of "unfounded" lawsuits.

In addition, the bill would require HHS to establish and oversee a database that would compile physician information voluntarily submitted by state medical boards and patients, including disciplinary action taken against specific physicians by medical boards and hospitals, complaints by patients and malpractice claims paid on the doctor's behalf. The bill would require HHS to develop performance standards for state medical boards. The legislation also would allow the U.S. Attorney General to provide grants to states and health care entities to develop mediation programs as alternatives to litigation.

Medicaid Commission

On Thursday, May 26, House and Senate Democratic leaders announced their decision not to appoint any Democratic Senators or Representatives to the HHS Medicaid Commission. In a compromise with the Congressional sponsor of the legislation to create a legislative commission to review the Medicaid program, HHS Secretary Leavitt agreed to establish an executive branch commission that would study Medicaid reform proposals. House Minority Leader Nancy Pelosi (D-CA) and Senate Minority Leader Harry Reid (D-NV) opposed the charge to the commission to recommend how to reduce federal spending on Medicaid by $10 billion in five years. In addition, the Secretary refused to allow Congressional leaders to appoint voting members to the Commission.

Tracking of Dangerous Drugs

On Wednesday, May 25, the Senate Health, Education, Labor and Pensions Committee approved a bill to encourage states to establish tracking systems designed to prevent dangerous drug interactions and to curb drag addicts’ access to prescription drugs. Senator Jeff Sessions (R-AL) introduced the National All Schedules Prescription Electronic Reporting Act (S. 518) to provide grants to states to improve or initiate electronic monitoring of prescriptions. A similar bill (HR 1132) is pending in the House of Representatives.

Next Week in Congress

Congress is in recess next week for the Memorial Day holiday

STATE ACTIVITY

As of May 23, legislatures in 26 states and the District of Columbia are in regular session. These states are California, Connecticut, Delaware, Illinois, Iowa, Kansas, Louisiana, Maine, Massachusetts, Michigan, Nebraska, New Hampshire, Nevada, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Vermont, and Wisconsin.

Medical Malpractice and Liability

Illinois: State Democratic and Republican legislators reached an agreement on medical liability reform that Gov. Blagojevich (D) indicated he would be wiling to sign. The measure includes non-economic damage caps as well as sympathy expression language. A local authority in the issue stated that, “Democrats, even those closely aligned with trial attorneys, finally came to realize that there was no way they could win an argument with the family physicians.”

Other State Activity

Midwestern Governors Association: The MGA passed a rural development policy resolution at the 2005 winter meeting. Included in the policy is a direct reference to support of "an integrated approach to individual and collective rural health needs, including educating, placing, and retaining physicians and other medical professionals at the rural community level..."