AAFP: Deficit Reduction Must Address Medicare Payment, Primary Care Physician Shortage

Tuesday, June 21, 2011


LEAWOOD, Kan. — Congress can reduce the federal deficit by reforming Medicare physician payment and increasing the primary care physician workforce to meet patient needs, according to Lori Heim, MD, chair of the American Academy of Family Physicians Board of Directors.

Heim urged the deficit reduction group headed by Vice President Joseph Biden to recommend reforms that support the primary care patient-centered medical home and build the primary care physician workforce. Taken together, such reforms would improve outcomes, reduce unnecessary hospitalization and help restrain the Medicare spending that is contributing to the federal deficit.

“The evidence that primary care restrains health care costs and improves quality is very clear when that care is delivered in a team-based patient-centered medical home,” Heim wrote in a letter to the group.

Researchers are seeing growing evidence that a primary care-based accountable care organization can reduce total costs by 7 to 10 percent, “largely by reducing avoidable hospitalizations and emergency room visits.” Moreover, research by the Robert Graham Center on Policy Studies in Family Medicine and Primary Care showed “over the longer term, these investments could offset inpatient costs by 50 percent or more.”

The deficit reduction proposal should include a Medicare fee schedule that would begin to reduce the payment gap between primary care and subspecialist physicians, according to Heim. She called for payment structure that implements a 3 percent differential rate for primary care services delivered by primary care physicians. The AAFP also calls for an increase to 20 percent for the Medicare Primary Care Incentive Payment. These will begin to encourage more medical students to choose primary care specialties, she wrote.

The deficit reduction proposal also should continue investment in primary care medical education, according to Heim.

“Achieving federal budget savings by rebalancing the ratio of primary care to subspecialists in the physician workforce (currently only about 30 percent of the physician workforce is primary care) will require a continued investment to strengthen our nation’s primary care workforce,” she wrote.

In addition to continuing support for the in-school interest subsidy on Federal Stafford loans for graduate and professional students, Heim called for “a strong commitment to programs administered by the Health Resources and Services Administration, Agency for Healthcare Research and Quality, and others that are essential to training our physician workforce, recruiting physicians to practice in underserved areas, and supporting them with research into evidence-based medical practice.”

The AAFP is not alone in its recommendations. The Council on Graduate Medical Education has recommended that average primary care physician income should be at least 70 percent of median incomes of all other physicians — up from the current 55 percent, Heim wrote. The Medicare Payment Advisory Commission has consistently recommended that Congress implement policies that rebalance the health care system on primary care. In June, MedPAC recommended that Congress implement policies that promote primary care, coordination of care across all parts of the health care system and replace the current incentives to increase the volume of services.

Supported by the evidence, the recommendations by health policy and education experts, the deficit proposal should include “sound and appropriate investments in the primary care infrastructure … that support more efficient health care for all and thus help tackle the long-term debt of the federal government,” Heim concluded.

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Founded in 1947, the AAFP represents 136,700 physicians and medical students nationwide. It is the largest medical society devoted solely to primary care. Family physicians conduct approximately one in five office visits -- that’s 192 million visits annually or 48 percent more than the next most visited medical specialty. Today, family physicians provide more care for America’s underserved and rural populations than any other medical specialty. Family medicine’s cornerstone is an ongoing, personal patient-physician relationship focused on integrated care.  To learn more about the specialty of family medicine, the AAFP's positions on issues and clinical care, and for downloadable multi-media highlighting family medicine, visit www.aafp.org/media. For information about health care, health conditions and wellness, please visit the AAFP’s award-winning consumer website, www.familydoctor.org(familydoctor.org).