Diagnosis for Democracy
Insights into the State of Our Union
A Blog by Rob Tenery, MD


June 11, 2012: The 1.5% Penalty

By Rob Tenery, MD on June 11, 2012

Needing some help from one of my technicians with a difficult patient, I called out from the examining room. “They’re both tied up on the phones,” my receptionist answered back from her post on the front desk. After the last patient of the day checked out, I pulled one of the technicians aside to inquire why at least one of them had not come to my aide.

“Neither of us has stopped since lunch.”  Her voice was laced with frustration. “I was looking up the pharmacy’s phone number to send out an e-script and Laura was on the line with one of our patients because his drug plan does not cover the medicine you prescribed for him this morning.”

Looking over at the cabinet door where the list of Medicare patients that we had e-scripted so far this year was posted, I came to the full realization of what was happening to our profession. Piece by piece, the freedom to choose what tests physicians order and the therapies we prescribe are being taken away.

Quickly fading are the days when physicians can just jot down an order for a particular test or write out a prescription for a certain medication. Now most tests, done on an outpatient basis, usually have to be on a pre-printed, double-copied request form. The test requested has to match the correct code and diagnosis. Sometimes it also has to be accompanied by a justification for the test to be covered by the payer.  For reimbursement purposes, never is the term ‘rule-out’ to be used!

Then there are prescription medications. Is the script for one month or three? Is it signed so that it can be filled as generic or labeled ‘brand necessary’? Is bioequivalent acceptable even if it is not the exact same medication? Is the particular medication covered in the formulary of the patient’s plan? Is the medication listed Tier II or Tier III? What about the concerns of the exorbitant costs and availability of discontinued and expired drugs and ‘Gray Market’ suppliers of these hard to find medications?

Since the Hatch-Waxman Act (1984) expedites the availability of generic drugs without the rigorous testing initially required by the ‘branded’ pharmaceutical companies, do the buffering and preservative agents perform as well as those of the name brand? Although the Medicare Part D program has added security for many patients with their medication reimbursements, the program treats payments for generics and ‘branded’ differently. This becomes important in the ‘donut-hole’ reimbursement credit that few patients understand.

The latest is the advent of e-scripts for those eligible physicians who are participants of the Medicare program. In accordance with The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), a five-year Medicare incentive program, beginning in 2009, was established to promote the adoption and use of e-prescribing. There is one caveat! The law also includes a penalty phase beginning in 2012 that would decrease payments of Medicare claims by 1.5% based on the 2013 fee schedule amounts during that year for those physicians who did not file for an exemption or meet the required number of e-scripts during the previous year.

So many questions--- so few answers.

Why are most pharmaceuticals significantly more expensive in this country, driving many patients to get their medications from other countries such as Canada, Mexico and India, even though many, if not most, are manufactured by American companies?  Are Canadian prescriptions what they purport to be or were they exported from China where there are no patent protection laws or supervision of content?  How have we allowed the federal payers, who started by telling physicians how long they can keep their patients in the hospital and reimburse physicians at the rate they determine, now penalize physicians for not prescribing in the way they decide? If that is not encroachment into the practice of medicine, I’m not sure what is.

Why don’t our representatives in Washington, our President, the Center for Medicare and Medicaid Services (CMS) and the FDA turn their attention to the real problems involving pharmaceuticals?

Quit asking the American public to fund much of the world’s medicines by cost shifting. Pass reasonable standards that would allow pharmaceutical companies to bring new products to the market more quickly, and without the prohibitive costs that force many of them to be developed elsewhere. Pass legislation that would curtail importation of medications (as reported with some of the mail-order pharmacies out of Canada) that are either counterfeit or inadequately tested. If generics are going to be forced on the American public, the standards for research and development must be as rigid as the ‘branded’ version, not only with the active ingredients, but with the buffers and preservatives as well.

Closer examination of the e-scripting program, reveals that the efficiencies at the pharmacy with dramatic decreases in transcription errors and potentially quicker availability must be factored against the longer employee time at the physician’s office that generates the prescription. Second, refills that need to be approved by the physician may go unnoticed on the office email, especially during times when the office is closed. With increasing sophistication to hack into computer files, there could be more potential for compromise of patient privacy than just writing out a prescription.

Any program that punishes physicians will only drive more physicians out of the Medicare program. Who ends up losing? The very group our elected leadership claims to support --- the patients.

Since punitive measures appear to be successful, it is inevitable that this approach will be emulated in other areas of health care delivery. The obvious next steps would be electronic medical record conversions (the American Recovery and Reinvestment Act of 2009) and remuneration levels based outcome analysis. That is unless we, the physicians, step up and say no. No to punitive measures that penalize physicians who refuse to comply with unreasonable mandates. No to continuing threats of fee cuts because our elected leadership can’t forge a proper solution to the Sustainable Growth Rate (SGR). No to robbing the already the underfunded Medicare program to cover the additional lives included under the Patient Protection and Affordable Care Act (PPACA).

When the Medicare program was first signed into law in 1965, my father and grandfather, both physicians, had predicted that it could lead to ‘socialized medicine’ as they referred to a total, government takeover of the health care delivery system. I scoffed at the idea. Now, I’m not so sure.

Even if Obamacare is reversed by the Supreme Court, the Feds and the payers are already doing it. Just a piece at a time!

It is said that everybody has his/her price. Mine is 1.5%.




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