|American Chiropractic Association
|President Bush Signs
Legislation Reversing Medicare Physician Fee Cuts
(Arlington, Va. - Feb. 9, 2006) President Bush signed
legislation yesterday that not only reverses the current 4.4 percent Medicare physician payment reduction, which went into
effect on the first of year, but will also provide automatic reprocessing of claims retroactive to Jan. 1, 2006. The legislation
was included in the Deficit Reduction Act.
“The ACA is extremely pleased that Congress has halted the current cut in physician Medicare payments and that they
have made the change retroactive,” said ACA President Dr. Richard G. Brassard. “The return to the 2005 rate is
at least partial recognition by Congress that health care providers face significant challenges in today’s practice
environment.”The Centers for Medicare & Medicaid Services (CMS) said it expects contractors to begin paying
new claims using 2005 rates within two days of the legislation’s enactment. In addition, doctors of chiropractic will
not need to resubmit existing claims submitted between Jan. 1 and Feb. 8, 2006. Contractors will automatically reprocess any
claims that used the rates effective as of Jan. 1, 2006, and will instead use the zero percent update retroactive to Jan.
1. CMS estimates contractors should be able to reprocess all claims by July 1, 2006. Providers will receive retroactive payment
for the differential in a lump sum.
Physician fee schedule amounts are determined by regulation and the only way they can be changed is through legislation;
this puts the issue in the hands of Congress. In late 2005, Congress evaluated the issue, but technical amendments in the
Senate prevented final action on this critical issue until this week.
CMS, recognizing that the physician payment adjustment could increase beneficiaries’ co-payments and deductibles
for previously billed services, has suggested to the Department of Health and Human Services (HHS) that if a beneficiaries’
co-pay changed on Jan. 1, 2006, a physician waiver of the amount now owed by the beneficiary should not be considered inducement.
More information will be available on the ACA Web site once a final decision has been made by HHS.
“The ACA will continue to lobby on behalf of its members for fair reimbursement of Medicare services. It is imperative
that Congress and HHS develop a permanent solution to the physician fee schedule because those most affected by this annual
dilemma are not doctors, but patients,” said Dr. Brassard.
Therapy CapsFor most doctors of chiropractic
– with the exception of those DCs participating in the Medicare Demonstration Project – coverage of chiropractic
services is specifically limited to treatment by means of manual manipulation of the spine. However, the ACA has received
numerous questions concerning therapy caps.
With language included in Deficit Reduction Act, the President also authorized the Centers for Medicare and Medicaid Services
(CMS) to develop a new exception process for Medicare beneficiaries to apply for medically necessary therapy services if their
treatment is expected to exceed the $1,740 cap in 2006. The ACA will provide more information as it becomes available on its
web site, www.acatoday.org.
|For more information:
VP, Department of Government Relations
phone: (703) 812-0214
|For more information:
Manager, Legal Office
phone: (703) 812-0246
Deal Hailed as Victory Over Managed Care
By Ceci Connolly
Washington Post Staff Writer
Tuesday, July 12, 2005; Page A02WellPoint Inc., the nation's largest health insurer with nearly 29 million members, announced
yesterday a $198 million settlement with physicians and medical societies designed to reduce the number of disputes over what
care is medically necessary and alleged unfair reductions in payments to doctors. The agreement, the largest of its kind,
will mean a modest back payment to about 700,000 doctors and, more important, significant changes in the way the managed-care
company pays medical claims in the future. Physicians hailed the settlement as one of the first real victories in their decades-long
struggle with managed-care companies over who decides what tests, therapies and surgeries a patient receives.
"The insurance company will no longer be in the exam room with the physician and patient," said Michael Sexton, president
of the California Medical Association. "The patient will get the appropriate care they need, when they need it."
Industry analysts predicted WellPoint will increase premiums to cover some of the cost, valued at more than $450 million
over several years, including lawyers' fees, payments to doctors and the cost of new billing systems. But WellPoint spokesman
James Kappel said the firm may be able to hold down premiums through modernizing and other efficiencies. Filed yesterday in
U.S. District Court in Miami, the agreement is the fifth to emerge from a massive class-action suit, consolidated in 2000,
targeting 10 large managed-care providers. The doctors and about a dozen state medical associations accused the health plans
of using a host of techniques to wrongly reduce physician payments. The physicians complained that by refusing to cover certain
tests and treatments or underpaying for services, the practices had a detrimental effect on patient care.
"The agreement does not imply any of our operational practices were improper," Kappel said. "We felt it was very important
to put this litigation behind us and focus on what matters most -- serving our customers."
Insurers complained that doctors gamed the system by breaking down an office visit into several billable items. Both sides
yesterday expressed hope the deal would bring a cease-fire. "We've been functioning as though we're enemies in a managed-care
cold war," said California Medical Association chief executive Jack Lewin. "We have wasted a lot of money and energy fighting
each other. "WellPoint, which recently merged with Anthem Inc., issued a statement from chief executive Larry Glasscock that
the deal is "a very important step in further collaborating with physicians." WellPoint has Blue Cross/Blue Shield subsidiaries
in 13 states, including Anthem Blue Cross & Blue Shield of Virginia.
By settling, WellPoint -- along with Aetna, Cigna, Prudential and HealthNet in previous agreements -- avoided a protracted,
expensive court fight. The five settlements, totaling more than $590 million in cash payments, include $40 million invested
in nonprofit foundations dedicated to improving health care quality.
In practical terms, the agreement should result in faster, easier physician reimbursement for procedures as mundane as
flu shots to complicated cancer therapies. It creates an independent appeal process for doctors whose claims are denied, requires
insurers to notify doctors of the set reimbursement for each procedure and calls for an immediate end to "downcoding," in
which the insurer pays for a lesser procedure at a lower rate than the physician billed. For example, a doctor treating a
patient with congestive heart failure would typically bill $90 for a "moderately complex follow-up visit" involving lab work,
a full examination and changes in the patient's medication, said Bohn Allen, immediate past president of the Texas Medical
Association. But the insurance company would automatically knock the claim down to a simple office checkup and pay just $45,
The appeal process to fight downcoding and denied claims took time and money, Allen said. "So the doctor was either forced
to reduce services or quit seeing the patient" and focus instead on others with more generous coverage.
Several doctors said they were especially pleased that the five settlements change the definition of "medical necessity"
in a way that returns more authority to the physician, rather than an insurance company bureaucrat.
Michael Greene, a family practitioner in Macon, Ga., said he recently treated a man suffering from severe migraines and
spinal pain by injecting a local anesthetic into the back of his scalp, a procedure known as an occipital nerve block.
"It worked," he said. But the man's health plan rejected the claim, indicating the treatment was not medically necessary.
Under the settlement, which must be approved by Judge Federico Moreno, Greene expects far fewer problems making those decisions.
In an interview, Kappel declined to respond to the allegations that WellPoint downcoded or used other systems to underpay
physicians.Nancy Chockley, president of the National Institute for Health Care Management Foundation, which is underwritten
in part by health insurers, said most large health plans have been implementing many of the changes laid out in the settlements.
"This is going to cost consumers more," she said. "Medical costs will go up and they will be passed on. "But Archie Lamb,
an Alabama lawyer who spearheaded the case, said underpaying physicians resulted in inferior care and more uninsured Americans.
"Nobody gains in a system where doctors are not being paid for the care they deliver," he said.In the suit, the doctors argued
that insurers violated the federal Racketeer Influenced and Corrupt Organizations Act, or RICO.