President Obama Calls for Better Payment System for Primary Care Physicians

Sustainable Growth Rate Formula Has to Go Away

June 09, 2010 03:20 pm News Staff

President Obama has called for changes in the nation's physician payment system to better compensate primary care physicians and thus encourage more medical students to pursue careers in the primary care field.

During a town hall meeting for senior citizens in Maryland, President Obama points out that reforming the Medicare payment system to encourage preventive care and to better compensate primary care physicians likely is "the single most important thing that we can do" to ensure good health care.

"This issue of primary care physicians is absolutely critical, and it has the promise of making such a big difference in the overall health of everybody, from children to seniors," said Obama during a June 8 town hall meeting( in Wheaton, Md.

"It used to be that most of us had a family doctor," said Obama. "You would consult with that family doctor. They knew your history. They knew your family. They knew your children. They helped deliver babies." Consequently, more people got regular checkups, making it easier to anticipate medical problems, according to Obama.

"Now in these big medical systems, so often, what happens is that you're shuttled around from (sub)specialist to (sub)specialist," said Obama. "Oftentimes, people don't have a primary care physician that they're comfortable with, so they don't get regular checkups. They don't get regular consultations. Preventable diseases end up being missed, and you don't have the kind of coordination that's necessary between all these different specialists."

Obama's remarks were made during the give-and-take portion of the town hall meeting and not from a prepared statement. The president told the audience of senior citizens that one of the main goals of the newly enacted health care reform legislation is to increase the number of primary care physicians and to give them more power so that "they are the hub around which a patient-centered medical system exists."

"And the first step is getting more primary care physicians," he stressed. "Sadly, a lot of young medical students, they'd love to go into primary care, but primary care physicians don't get paid as well as (sub)specialists. So, they say to themselves, 'You know what, I don't want to -- I've got all these medical school bills that I've got to pay. I've got to become a plastic surgeon or something.'"

Obama pointed out that the health care reform law creates new loan forgiveness programs and strengthens existing ones to make primary care more enticing for medical students. He also said that changing the payment system to encourage preventive care and to better compensate primary care physicians is "probably going to be the single most important thing that we can do to assure that you and those of you who have good primary care physicians continue to get that kind of care."

"Right now you've got a situation where if a primary care physicians says to a patient, 'You know what, you need to lose some weight because you're at risk of diabetes, and I've got a good exercise program that makes sense, and here's a dietitian that you should talk to,' sometimes Medicare may not reimburse that consultation," Obama said.

But, he noted, Medicare will pay $30,000 for a foot amputation that results from the ensuing diabetes.

"That doesn't make sense," said Obama.

The president also assailed the sustainable growth rate, or SGR, formula, saying it is something that has to be fixed. The SGR governs Medicare physician payment rates and regularly calls for a reduction in those rates. Congress recently failed to pass a patch to the system, thus allowing a 21.3 percent reduction called for by the SGR formula to take effect on June 1.

"What we shouldn't do is have this guillotine hanging over (physicians') heads every year where they're having to figure out, 'Am I going to get reimbursed or is, suddenly, my income going to drop 20 percent?'" said Obama.

It is imperative, he added, "to make sure that your doctor is getting reimbursed so that they can stay in business and keep their doors open."

"My administration has worked very closely with doctors to try to see if we can get this fixed short term, but ultimately, we're going to have to get it fixed long term," he added.

In the meantime, the AAFP, along with the American College of Physicians and the American Osteopathic Association have again urged Congress to replace the SGR with a payment formula that more accurately reflects the work performed by physicians.

In a June 4 letter to House and Senate leaders, the organizations expressed their members' "deep frustration with Congress' inability to agree on a framework to eliminate the endless cycle of Medicare physician payment cuts created by the unworkable SGR and to recommend an approach to move to a permanent solution."

"Although stabilizing payments is essential, it is not enough for Congress to substitute a temporary positive update for the 21 percent cut that went into effect on June 1 unless it leads to a better payment framework," says the letter.

The organizations call for a framework that will

  • provide stable and predictable updates that reflect increases in physician practice expenses;
  • allow for more realistic and achievable spending growth for physicians' services than the current SGR formula;
  • provide for higher growth targets for primary care visits and preventive services; and
  • account for the costs of providing "stable, predictable and fair updates in payments to physicians, rather than hiding the costs by assuming a bigger 'cliff' in future years."

In the letter, the AAFP and the other groups said higher growth targets and updates for primary care visits and prevention are essential because demand for primary care and prevention will continue to grow as the population ages and more Americans become eligible for Medicare.

The letter points out that "primary care and preventive services are undervalued by Medicare and other payers," which has led to a growing shortage of 35,000 to 44,000 primary care physicians for adult patients.