AAOS Now

Published 5/1/2011
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Mary Ann Porucznik

Rules, reforms, and regulations

NOLC symposia spotlight issues of concern

The American Association of Orthopaedic Surgeons (AAOS) 2011 National Orthopaedic Leadership Conference (NOLC), was held in Washington, D.C., during a week filled with tense negotiations over the federal budget and efforts to avoid a government shutdown. Attendees—members of the AAOS Board of Councilors (BOC) and Board of Specialty Societies (BOS)—nonetheless managed to meet with several members of Congress or their staffs and to focus on specific issues of concern, including ancillary services, the Independent Payment Advisory Board (IPAB), and implementation of the Patient Protection and Affordable Care Act (PPACA).

This issue of AAOS Now looks at two symposia presented during the NOLC. Next month, AAOS Now will report on Hill visits as well as the other symposia presentations. For links to leave-behind materials and issues in-depth, see the online version of this article, available at www.aaosnow.org

The IPAB
BOC Chair-Elect Fred C. Redfern, MD, served as moderator for the session on the IPAB. According to Chris Dawe, a professional staff member at the Senate Finance Committee, the IPAB was created under healthcare reform as a mechanism to limit Medicare spending. Calling its establishment an “act of humility” by Congress, Mr. Dawe noted that the IPAB would be composed of 15 independent experts who would be charged to develop cost-cutting proposals if the current measures, which primarily focus on delivery system reforms, are not successful in containing costs.

“It’s not a cap on growth,” he noted. Under the legislation, the IPAB could present proposals only if costs exceeded a target growth. Congress would have the following three options:

  • Do nothing and let the IPAB proposals go into effect.
  • Develop their own proposals.
  • Waive the requirement that costs cannot exceed the target.

When audience members pointed out that the full-time nature of the IPAB panel would exclude practicing physicians, Mr. Dawe responded that the administration is still looking for ways to involve “those on the frontline.”

“I understand your skepticism,” he said, but reinforced that the IPAB is a top priority for this administration. He also noted that efforts to develop a permanent fix to the sustainable growth rate (SGR) by the end of the year are continuing. And, he said, the IPAB targets are not cumulative, as the SGR is.

According to Rep. Phil Roe, MD (R-Tenn.), who also spoke, the IPAB was not part of the original House bill for healthcare reform. He pointed out that doctors will bear the brunt of any initial cuts, because hospitals are exempted for the first 5 years. As a result, patients will see less access to care. He encouraged audience members to support HR 452, the Medicare Decisions Accountability Act, which repeals the IPAB.

Rep. Roe also reviewed the current timeline for implementation of the PPACA, and its impact on seniors, insurers, and healthcare providers.

Implementing reform
The session on implementing healthcare reform, led by David Teuscher, MD, included presentations by Alan Weil, JD, MPP, executive director of the National Academy for State Health Policy; William A. Hazel, MD, an orthopaedic surgeon and current Secretary for Health and Human Services for the Commonwealth of Virginia; and Kevin J. Bozic, MD, MBA, chair of the AAOS Health Care Systems Committee.

According to Mr. Weil, the most significant changes under PPACA will be implemented in 2014. These reforms include expanding Medicaid coverage, implementing the health insurance exchanges, and requiring all individuals to have coverage. Because mandates in the federal law will require reforms at the state level, Mr. Weil presented several focal areas for state policymakers.

States will face challenges, he noted, particularly with regard to fiscal capacity as stimulus funds run out. Despite strong opposition to the law in many states, most have taken steps to ensure that they will be able to meet the required deadlines. Physician engagement is essential to the implementation process, according to Mr. Weil. He suggested that because federal resources will focus on coverage, physicians should start advocating for tools to improve the healthcare delivery system.

Virginia exemplifies the dilemma faced by many states. Although the governor disagrees with the way that PPACA was designed, he is proceeding with steps to comply with its mandates. Dr. Hazel believes that broad health reform is essential and that mandates are necessary if pre-existing conditions limitations are eliminated.

One problem with PPACA, he noted, is the disincentive for employers to continue to provide health insurance for their employees. Because the fines for not providing coverage are so low, he thinks that many businesses may opt to pay the fines, and their employees will end up in the health insurance exchanges.

The growth in Medicaid will also have to be addressed by states, as will the workforce shortage among physicians.

“We have to do this,” he said, “but why aren’t physicians driving this train?” He recommended that physicians be proactive in advocating for changes to the healthcare delivery system and participating in the state-level committees and task forces that will be designing programs.

Because PPACA assumes significant cost savings through coordinated care, it promotes the establishment of “accountable care organizations” (ACOs), which Dr. Bozic discussed. He pointed out that patients would be assigned to an ACO based on their primary care physician’s participation. Although participation by primary care physicians is exclusive, most specialists would be able to participate in multiple ACOs if they choose to do so.

Dr. Bozic noted that the role of specialists still needs to be defined and that orthopaedic surgeons can add value by helping establish appropriate indications for referrals, diagnostic and therapeutic interventions, and performance measures. Musculoskeletal care currently accounts for 17 percent of all healthcare dollars, so savings in this area could be significant.

Finally, he cautioned that, although the Federal Trade Commission and the Department of Justice have drafted regulations for healthcare providers who participate in an ACO, this is not “a free pass to collude.”

Mary Ann Porucznik is managing editor of AAOS Now. She can be reached at porucznik@aaos.org