November 2005 Volume 29 No. 10
Take me to your leaders

One of my jobs as president of the Medical Staff is to make your views known to those who would affect our practices and our patients in a broad political context.

I do attend a lot of meetings, but the payoff is that they are usually worth the time. Currently, I am the Medical Staff’s representative to the Santa Clara County Medical Association, California Medical Association and the American Medical Association Organized Medical Staff Sections (CMA-OMSS and AMA-OMSS). If you have issues that you would like me to take to one of these organizations, please let me know. It is always possible to start debate in these forums on important issues.

This month I will summarize some of the major issues being dealt with by these three organizations, most of which affect individual Medical Staff members in our practice of medicine.

New Program to Pay for Uncompensated Emergency Care to Undocumented Immigrants

You may be eligible for compensation if you’ve helped an undocumented alien. Section 1011 of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 provides $250 million per year for FY 2005-2008 for payments to eligible providers for emergency care provided to undocumented aliens. California is targeted to receive more than $70 million of these funds per year. Payments are made directly to hospitals, physicians, and ambulance providers and are distributed on a quarterly basis. In general, payments are made only after an uncovered eligible alien presents at an emergency department for care. Coverage continues until the patient’s condition is “stabilized".

The CMA is concerned that the questions and procedures required to determine a patient’s eligibility might very well discourage patients from getting necessary services under this law. Only services provided after May 9, 2005 are eligible for this payment plan. Also, payments are made only if there is no other source of payment available.

In order to be reimbursed, physicians must submit an application form to “Trailblazer" (a payment agency). You can call (866) 860-1011 or go on-line at www.trailblazerhealth.com/Section1011/Enrollment.aspx

The Debate over Specialty Hospitals

Specialty hospitals are favored by some who contend
a) that they can be more efficient than large general hospitals,
b) provide more physician control over scheduling and equipment, and
c) offer financial incentives to part-owners (usually physicians). Examples of these hospitals are orthopedic or cardiovascular practices. Patients generally like these hospitals because they are newer, less institutionalized, and can cater to more affluent patients.

General hospitals oppose the concept because they feel that specialty hospitals siphon off some of the most financially rewarding portions of their business. They feel that this leaves the general hospital with a sicker, higher-cost, lower-paying patient population. When financially disadvantaged, general hospitals have more difficulty providing charity care and emergency trauma care to the community.

After a Congressional moratorium on new specialty hospitals recently “sunseted," the CMA Board of Trustees voted to oppose any further prohibition on physician ownership, control, or governance of specialty hospitals. The CMA believes that the underlying problem is uncompensated care, especially emergency care. All general hospitals are dependent on the ability to cost-shift toward better paying services to cover the services that are poorly or not compensated. The CMA supports efforts to obtain funding for ED services.

This problem became acute in California recently after Loma Linda University objected to a large modern specialty hospital planned near its medical center. Fearing the new specialty facility could siphon off as much as a third of its profits, Loma Linda leaders have asked: “What is the social consequence?"

Mandatory Emergency Room Coverage

The EMTALA (Emergency Medical Treatment and Active Labor Act) technical advisory group had put forth a proposal to require physicians to take emergency room call as a condition of participation in Medicare. Many hospitals (not Stanford) have serious problems with their medical staffs refusing to participate in ED call schedules, mainly due to payment issues. CMA was able to convince the EMTALA group to drop this proposal.

Medicare Cuts

Medicare physician payment rates, as currently scheduled, will begin to decrease 4 to 5 percent per year starting in January 2006. This amounts to a total 26 to 30 percent decrease in real dollars by 2012. A CMA physician survey found that 60 percent of California physicians would no longer accept new Medicare patients and 40 percent would be forced to stop treating Medicare patients completely if these payment cuts went forward.

These cuts are an unintended consequence of the Medicare formula called the “sustainable growth formula (SGR)" that regulates spending on physician services. Both the House and Senate are considering separate bills to correct the situation. Both bills are called the “Preserving Patient Access to Physicians Act of 2005". If passed by Congress, these bills would provide an increase in payments of 2.7 percent for 2006 and 2007 as well as permanent fixes in the Medicare payment schedules.

Physicians should contact their Federal legislators and urge passage of Senate Bill 1081 (SB 1081) and House Bill 2356 (HR 2356). You can find more information starting on the CMA and AMA websites:

As always, I welcome your comments and feedback at