Medicare Cuts and VA Health Care Issues
This is MOAA's Legislative Update for Friday, June 20, 2003
In case you are unaware, the old The Retired Officers Association (TROA) is now
the Military Officers Association of America (MOAA)
Issue 1: More Medicare Cuts Coming? The government recently announced a
proposed 4.2 percent cut in Medicare provider reimbursement rates for 2004.
Congress needs to act and change the flawed formula that continually lowers
rates and puts beneficiaries at risk for access to care.
Issue 2: MOAA Testifies on Health Task Force Report. MOAA Deputy
Directors Dr. Sue Schwartz and COL Bob Norton, USA (Ret.) testified this week
before the House Veterans Affairs Committee on the final report of the
Presidential Task Force on
DoD - VA health care collaboration.
Issue 1: More Medicare Cuts Coming?
In the past year, one of MOAA's important goals has been the enactment of an
increase in provider reimbursement rates for Medicare and TRICARE. Significant
reductions in reimbursement over the past few years have limited the number of
providers willing to treat these patients. These cuts also hurt TRICARE
beneficiaries, as TRICARE rates are tied directly to Medicare. In February,
lobbying efforts by MOAA and other organizations such as the American Medical
Association (AMA) were successful in preventing a proposed 4.4 percent Medicare
rate cut, and instead effecting a 1.6 percent increase for both Medicare and
TRICARE.
However, recent events open the door to the possibility that we will have to
fight this battle all over again. Recently, the Centers for Medicare and
Medicaid Services (CMS) announced plans for a 4.2 percent cut effective next
January. With many providers already refusing Medicare and TRICARE patients
because of the low rates, another round of cuts would deter even more from
participating, which would disenfranchise more beneficiaries who rely on
Medicare or TRICARE for their health needs.
The problem is that the Medicare used to determine reimbursement rates relies on
a faulty premise. It's based on the assumption that when the economy goes down,
so does consumption of health care. That's just not true. No matter whether
the economy is good or bad, people are still going to need health care and a
doctor who will care for them.
In the meantime, there is some hope. The House version of the Medicare
prescription drug bill calls for a 1.2 percent increase in Medicare rates. The
Senate bill currently being debated on the floor contains no provisions to
address this issue. We're optimistic the House version will prevail when both
chambers come together to hammer out their differences in conference, but won't
be leaving that to chance.
MOAA is working to convince legislators that the current Medicare rate formula
is flawed, and puts beneficiaries at risk of losing access to care. Congress
needs to replace it with a formula that more accurately reflects the cost of
providing care. Until that happens, we'll keep fighting this legislative battle
as long as it takes.
Issue 2: MOAA Testifies on Health Task Force Report
Tuesday's House Veterans Affairs Committee hearing was the second this month to
consider the final recommendations of the Presidential Task Force (PTF) to
Improve Health Care Delivery for Our Nation's Veterans. Dr. Schwartz testified
on a panel with other Commissioners appointed by the President; Colonel Norton
testified on a panel of military and veterans service organization
representatives. The opening panel featured testimony by government witnesses
Dr. Leo McKay, Ph.D., Deputy Secretary of Veterans Affairs, and Dr. David Chu,
Ph.D., Under Secretary of Defense for Personnel and Readiness.
Much of the discussion during the lengthy hearing centered on the PTF's
recommendation that the government should provide "full funding" for all
veterans enrolled in Priority Groups 1 - 7.
(Disabled, Purple Heart, and indigent veterans, and veterans exposed to toxic substances in service are assigned to priorities 1-6; priority 7 veterans have no disabilities but have incomes higher than $24,600 but below certain levels established locally).
The PTF Report recommends full funding by mandatory means or by modification of the current annual appropriations process.
Speaking for the Administration, Dr. McKay testified that the VA was fully funded for the next fiscal year (FY2004).
But Committee Chairman Rep. Chris Smith (R-NJ) and other Committee members
expressed skepticism and dismay at this assertion and repeatedly challenged Dr.
McKay to explain how the VA's budget could meet the unmet demand for timely
health care services. Currently, more than 200,000 veterans are on appointment
waiting lists of six months to a year.
Rep. Steve Buyer (R-IN) riled the hearing by stating that the PTF had been
"hijacked" by turning its attention too much to VA funding problems rather than
DoD - VA sharing activities. But Chairman Smith and Veterans Health
Subcommittee Chairman Rob Simmons (R-CT) said they agreed with PTF assessment
that real collaboration between the two health systems would not be possible
unless the VA's demand - funding mismatch was resolved.
Five PTF Commissioners including Dr. Schwartz testified in the second panel. The
Commissioners agreed on the full funding mandate but differed on the extent to
which it should apply to non-service connected veterans assigned to lower
discretionary care categories. The controversy took center stage late last year
when VA Secretary Anthony Principi established a new enrollment category for
non-service connected veterans with incomes above a zipcode-based means test
(Priority Group 8).
Principi then closed enrollments to veterans in the new category. Dr. Schwartz
stressed that the controversy should not be allowed to overshadow the PTF's
"unanimous decision" that all veterans enrolled in Priority Groups 1-7 should
have their care fully funded. Schwartz also urged attention to PTF
recommendations on the importance of strategic planning, top-level leadership
commitment, and management incentives to sustain and reward collaborative
activities between the DoD and VA health care systems.
Colonel Norton stressed the vital importance to servicemembers and veterans of
implementing "seamless transition" initiatives recommended by the PTF such as
development of a common separation physical, "interoperable, bi-directional"
medical records, and procedures to capture information on hazardous exposures in
military service. Norton pointed out that there are still hundreds of thousands
of veterans' claims awaiting decision by the VA. Problems veterans have
encountered for decades trace to poor or missing information on servicemembers'
health. Unless DoD and the VA get this right, the problems of the past will
continue for the veterans of the 21st century, Norton noted.
To view the written testimony of each of the panels go to
http://veterans.house.gov/hearings/schedule108/jun03/6-17-03/witness.html.
Chairman Smith used the hearing to tout new legislation (H.R. 2475) he
introduced on Monday that would establish mandatory funding for Priority Groups
1-6, set up an outside panel of experts to gauge the VA's funding needs, and
define the VA's standards of access to care.
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Submitted,
YNCS Don Harribine, USN(Ret)