Finance Committee 'Options Paper' Calls for Primary Care Increases

The Senate Finance Committee has issued a policy options paper (52-page PDF; About PDFs) for health care reform that would provide a bonus payment of least 5 percent for Medicare primary care services during the next five years and a 1 percent increase in the overall physician payment rate in 2010 and 2011. This would bring the overall increase for primary care services to 6 percent in 2010 and 2011 under the draft proposal.

The options paper, which was released on April 29, is the first of three discussion papers on health care reform expected to be issued by the Senate Finance Committee. It recommends paying for the 5 percent primary care bonus by reducing Medicare payments for non-primary care services under Medicare by about 0.5 percent, according to Kevin Burke, director of the AAFP’s Division of Government Relations.

The options paper also proposes other bonus payments, including a 2 percent payment for physicians who participate in the Physician Quality Reporting Initiative. In addition, the paper recommends providing an unspecified bonus payment for physicians who provide transitional care to patients for a specific chronic disease after a hospital stay and a care management fee for chronically ill patients who are not readmitted to the hospital.

Physician workforce issues also are covered by the paper, including a proposal to convert all unused graduate medical education, or GME, slots from subspecialists to primary care. However, the committee did not address additional funding for these primary care GME slots in the paper.

The options paper also calls for a shift in payment from fee-for-service to accountable care organizations, or ACOs, which could place small and rural physician practices at a disadvantage because they would have the most difficulty participating in ACOs, according to Burke.

The options paper does not propose the immediate elimination of the sustainable growth rate, or SGR, formula, which is used to calculate Medicare physician payment rates. However, it does recommend blocking and ultimately mitigating the effects of the flawed formula.

Burke said the AAFP is evaluating all of the provisions of the document and meeting with committee members to better understand their intentions and the details of the committee’s internal discussions about the paper's proposals. Public comments on the draft proposal are due on May 15.