Mary Ellen Schneider

The Medicare Payment Advisory Commission has recommended that Congress extend the moratorium on the development of new physician-owned specialty hospitals, but its chairman urged members of Congress not to close the door on these hospitals before the potential benefits can be fully investigated.

“Frankly, the status quo in our health care system is not great,” MedPAC chairman Glenn Hackbarth testified at a hearing of the Senate Finance Committee on specialty hospitals last month. “We've got real quality and cost issues.”

MedPAC members are concerned about the potential conflict of interest in physician-owned specialty hospitals, Mr. Hackbarth said, but they are not prepared to recommend outlawing them until they see evidence on whether specialty hospitals offer increased quality of care and efficiency.

And policymakers do not yet have the answers to those questions, he said.

Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, are drafting legislation that will set Medicare policy on specialty hospitals.

Sen. Grassley said that he will rely on the MedPAC findings as he drafts the legislation. He is also awaiting the final results of a study on quality of care at specialty hospitals from the Centers for Medicare and Medicaid Services.

Officials at CMS presented preliminary findings from that study at the hearing. CMS was charged under the Medicare Modernization Act of 2003 with examining referral patterns of specialty-hospital physician owners, assessing quality of care and patient satisfaction, and examining differences in the uncompensated care and tax payments between specialty hospitals and community hospitals.

Based on claims analysis, the preliminary results show that quality of care at cardiac hospitals was generally at least as good and in some cases better than the quality of care at community hospitals. Complication and mortality rates were also lower at cardiac specialty hospitals, even when adjusted for severity of illness.

However, because of the small number of discharges, a statistically significant assessment could not be made for surgical and orthopedic hospitals, said Thomas A. Gustafson, Ph.D., deputy director of the Center for Medicare Management at CMS.

Patient satisfaction was high at cardiac, surgical, and orthopedic hospitals, Dr. Gustafson said, due to amenities like larger rooms and easy parking, adding that patients had a favorable perception of the clinical quality of care they received at the specialty hospitals.

But Sen. Baucus expressed skepticism about the findings and how the study was conducted. He urged caution in using the results of the CMS study as a basis for policy making.

In its report to Congress, MedPAC recommended that the moratorium on construction of new specialty hospitals be extended another 18 months—until Jan. 1, 2007.

While MedPAC stopped short of recommending that Congress ban new specialty hospitals, the panel did recommend payment changes that would remove incentives for hospitals to treat healthier but more profitable patients.

First, the panel recommended that the secretary of Health and Human Services refine the current diagnosis-related groups (DRGs) to better capture differences in severity of illness among Medicare patients.

The panel also advised the HHS secretary to base the DRG relative weights on the estimated cost of providing care, rather than on charges. And MedPAC recommended that Congress amend the law to allow the HHS secretary to adjust DRG relative weights to account for differences in the prevalence of high-cost outlier cases.

These changes would affect all hospitals that see Medicare patients and increase the accuracy and fairness of payments, Mr. Hackbarth said.

In addition, MedPAC tried to address physicians' concerns that they do not have a say in the management of community hospitals, by recommending that Congress allow the HHS secretary to permit “gainsharing” arrangements between physicians and hospitals. Gainsharing aligns financial incentives for physicians and hospitals by allowing physicians to share in the cost savings realized from delivering efficient care in the hospital.

But even with these changes, Mr. Hackbarth said MedPAC members still have concerns about the impact of physician ownership on clinical decision making.

And members of the Senate Finance Committee also raised questions about the appropriateness of physician self-referral.

“When it comes to physician ownership of specialty hospitals, I'm not sure the playing field is level,” Sen. Baucus said.

Physicians are the ones who choose where patients will receive care, he said. He compared the physician owners of specialty hospitals to coaches who choose the starting lineup for both teams.

Advocates for specialty hospitals, including the American Medical Association and the American Surgical Hospital Association, are lobbying Congress to end the moratorium, saying it will allow competition and won't hurt community hospitals.

But opponents are asking Congress to close the the federal self-referral-law exemption that allows physicians to invest in the “whole hospital” rather than a single department.

Sen. Baucus said that surgical specialty hospitals, which on average have only 14 beds, look more like hospital departments than full-service hospitals. “This loophole may well need closing,” he said.

The Medicare Payment Advisory Commission has recommended that Congress extend the moratorium on the development of new physician-owned specialty hospitals, but its chairman urged members of Congress not to close the door on these hospitals before the potential benefits can be fully investigated.

“Frankly, the status quo in our health care system is not great,” MedPAC chairman Glenn Hackbarth testified at a hearing of the Senate Finance Committee on specialty hospitals last month. “We've got real quality and cost issues.”

MedPAC members are concerned about the potential conflict of interest in physician-owned specialty hospitals, Mr. Hackbarth said, but they are not prepared to recommend outlawing them until they see evidence on whether specialty hospitals offer increased quality of care and efficiency.

And policymakers do not yet have the answers to those questions, he said.

Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, are drafting legislation that will set Medicare policy on specialty hospitals.

Sen. Grassley said that he will rely on the MedPAC findings as he drafts the legislation. He is also awaiting the final results of a study on quality of care at specialty hospitals from the Centers for Medicare and Medicaid Services.

Officials at CMS presented preliminary findings from that study at the hearing. CMS was charged under the Medicare Modernization Act of 2003 with examining referral patterns of specialty-hospital physician owners, assessing quality of care and patient satisfaction, and examining differences in the uncompensated care and tax payments between specialty hospitals and community hospitals.

Based on claims analysis, the preliminary results show that quality of care at cardiac hospitals was generally at least as good and in some cases better than the quality of care at community hospitals. Complication and mortality rates were also lower at cardiac specialty hospitals, even when adjusted for severity of illness.

However, because of the small number of discharges, a statistically significant assessment could not be made for surgical and orthopedic hospitals, said Thomas A. Gustafson, Ph.D., deputy director of the Center for Medicare Management at CMS.

Patient satisfaction was high at cardiac, surgical, and orthopedic hospitals, Dr. Gustafson said, due to amenities like larger rooms and easy parking, adding that patients had a favorable perception of the clinical quality of care they received at the specialty hospitals.

But Sen. Baucus expressed skepticism about the findings and how the study was conducted. He urged caution in using the results of the CMS study as a basis for policy making.

In its report to Congress, MedPAC recommended that the moratorium on construction of new specialty hospitals be extended another 18 months—until Jan. 1, 2007.

While MedPAC stopped short of recommending that Congress ban new specialty hospitals, the panel did recommend payment changes that would remove incentives for hospitals to treat healthier but more profitable patients.

First, the panel recommended that the secretary of Health and Human Services refine the current diagnosis-related groups (DRGs) to better capture differences in severity of illness among Medicare patients.

The panel also advised the HHS secretary to base the DRG relative weights on the estimated cost of providing care, rather than on charges. And MedPAC recommended that Congress amend the law to allow the HHS secretary to adjust DRG relative weights to account for differences in the prevalence of high-cost outlier cases.

These changes would affect all hospitals that see Medicare patients and increase the accuracy and fairness of payments, Mr. Hackbarth said.

In addition, MedPAC tried to address physicians' concerns that they do not have a say in the management of community hospitals, by recommending that Congress allow the HHS secretary to permit “gainsharing” arrangements between physicians and hospitals. Gainsharing aligns financial incentives for physicians and hospitals by allowing physicians to share in the cost savings realized from delivering efficient care in the hospital.

But even with these changes, Mr. Hackbarth said MedPAC members still have concerns about the impact of physician ownership on clinical decision making.

And members of the Senate Finance Committee also raised questions about the appropriateness of physician self-referral.

“When it comes to physician ownership of specialty hospitals, I'm not sure the playing field is level,” Sen. Baucus said.

Physicians are the ones who choose where patients will receive care, he said. He compared the physician owners of specialty hospitals to coaches who choose the starting lineup for both teams.

Advocates for specialty hospitals, including the American Medical Association and the American Surgical Hospital Association, are lobbying Congress to end the moratorium, saying it will allow competition and won't hurt community hospitals.

But opponents are asking Congress to close the the federal self-referral-law exemption that allows physicians to invest in the “whole hospital” rather than a single department.

Sen. Baucus said that surgical specialty hospitals, which on average have only 14 beds, look more like hospital departments than full-service hospitals. “This loophole may well need closing,” he said.

The Medicare Payment Advisory Commission has recommended that Congress extend the moratorium on the development of new physician-owned specialty hospitals, but its chairman urged members of Congress not to close the door on these hospitals before the potential benefits can be fully investigated.

“Frankly, the status quo in our health care system is not great,” MedPAC chairman Glenn Hackbarth testified at a hearing of the Senate Finance Committee on specialty hospitals last month. “We've got real quality and cost issues.”

MedPAC members are concerned about the potential conflict of interest in physician-owned specialty hospitals, Mr. Hackbarth said, but they are not prepared to recommend outlawing them until they see evidence on whether specialty hospitals offer increased quality of care and efficiency.

And policymakers do not yet have the answers to those questions, he said.

Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, are drafting legislation that will set Medicare policy on specialty hospitals.

Sen. Grassley said that he will rely on the MedPAC findings as he drafts the legislation. He is also awaiting the final results of a study on quality of care at specialty hospitals from the Centers for Medicare and Medicaid Services.

Officials at CMS presented preliminary findings from that study at the hearing. CMS was charged under the Medicare Modernization Act of 2003 with examining referral patterns of specialty-hospital physician owners, assessing quality of care and patient satisfaction, and examining differences in the uncompensated care and tax payments between specialty hospitals and community hospitals.

Based on claims analysis, the preliminary results show that quality of care at cardiac hospitals was generally at least as good and in some cases better than the quality of care at community hospitals. Complication and mortality rates were also lower at cardiac specialty hospitals, even when adjusted for severity of illness.

However, because of the small number of discharges, a statistically significant assessment could not be made for surgical and orthopedic hospitals, said Thomas A. Gustafson, Ph.D., deputy director of the Center for Medicare Management at CMS.

Patient satisfaction was high at cardiac, surgical, and orthopedic hospitals, Dr. Gustafson said, due to amenities like larger rooms and easy parking, adding that patients had a favorable perception of the clinical quality of care they received at the specialty hospitals.

But Sen. Baucus expressed skepticism about the findings and how the study was conducted. He urged caution in using the results of the CMS study as a basis for policy making.

In its report to Congress, MedPAC recommended that the moratorium on construction of new specialty hospitals be extended another 18 months—until Jan. 1, 2007.

While MedPAC stopped short of recommending that Congress ban new specialty hospitals, the panel did recommend payment changes that would remove incentives for hospitals to treat healthier but more profitable patients.

First, the panel recommended that the secretary of Health and Human Services refine the current diagnosis-related groups (DRGs) to better capture differences in severity of illness among Medicare patients.

The panel also advised the HHS secretary to base the DRG relative weights on the estimated cost of providing care, rather than on charges. And MedPAC recommended that Congress amend the law to allow the HHS secretary to adjust DRG relative weights to account for differences in the prevalence of high-cost outlier cases.

These changes would affect all hospitals that see Medicare patients and increase the accuracy and fairness of payments, Mr. Hackbarth said.

In addition, MedPAC tried to address physicians' concerns that they do not have a say in the management of community hospitals, by recommending that Congress allow the HHS secretary to permit “gainsharing” arrangements between physicians and hospitals. Gainsharing aligns financial incentives for physicians and hospitals by allowing physicians to share in the cost savings realized from delivering efficient care in the hospital.

But even with these changes, Mr. Hackbarth said MedPAC members still have concerns about the impact of physician ownership on clinical decision making.

And members of the Senate Finance Committee also raised questions about the appropriateness of physician self-referral.

“When it comes to physician ownership of specialty hospitals, I'm not sure the playing field is level,” Sen. Baucus said.

Physicians are the ones who choose where patients will receive care, he said. He compared the physician owners of specialty hospitals to coaches who choose the starting lineup for both teams.

Advocates for specialty hospitals, including the American Medical Association and the American Surgical Hospital Association, are lobbying Congress to end the moratorium, saying it will allow competition and won't hurt community hospitals.

But opponents are asking Congress to close the the federal self-referral-law exemption that allows physicians to invest in the “whole hospital” rather than a single department.

Sen. Baucus said that surgical specialty hospitals, which on average have only 14 beds, look more like hospital departments than full-service hospitals. “This loophole may well need closing,” he said.

The American Hospital Association is calling on Congress to permanently ban the practice of self-referral of patients to new physician-owned specialty hospitals.

Congress placed an 18-month moratorium on the construction of new physician-owned specialty hospitals under the Medicare Modernization Act of 2003. The moratorium is set to expire in June.

In a new report, the American Hospital Association (AHA) contends that physician-owned specialty hospitals have led to increased costs and the increased use of health care services, forced cutbacks in other services at full-service hospitals, and placed access to emergency and trauma services at risk.

“This practice strips full-service hospitals of critical resources needed to provide a full array of services that the community expects,” George Lynn, chairman of AHA's Board of Trustees and president of AtlantiCare in Atlantic City, N.J., said at a press conference.

AHA examined the impact of specialty hospitals on patients, communities, and full-service hospitals in Lincoln, Neb.; Oklahoma City; Wichita, Kan.; and the Black Hills region of South Dakota.

When these hospitals entered a community, access to emergency and trauma care was put at risk, the report found. And full-service community hospitals made cuts in areas such as behavioral health care, outpatient clinics for low-income patients, health education and awareness, and medical education.

In addition, investments in new technologies were delayed or cut altogether, Mr. Lynn said.

The report also found physician-owned specialty hospitals focused on higher-reimbursed services. “These physician-owned, limited-service hospitals seem to be experts at choosing patients and services that are most financially rewarding and steering them to their own facilities,” he said.

But Randolph B. Fenninger, Washington representative for the American Surgical Hospital Association (ASHA), the trade group for physician-owned specialty hospitals, said continuing the moratorium is unnecessary.

Instead, Mr. Fenninger said the ASHA supports making changes to the diagnosis-related-group prospective payment system to better reflect the cost of care. The Medicare Payment Advisory Commission recently recommended that Congress extend the moratorium another 18 months, to study the impact of the hospitals and implement payment changes.

However, the payment changes alone won't be enough to alter current incentives, Mr. Lynn said. AHA plans to continue to work with members of Congress to make the moratorium permanent.

The American Hospital Association is calling on Congress to permanently ban the practice of self-referral of patients to new physician-owned specialty hospitals.

Congress placed an 18-month moratorium on the construction of new physician-owned specialty hospitals under the Medicare Modernization Act of 2003. The moratorium is set to expire in June.

In a new report, the American Hospital Association (AHA) contends that physician-owned specialty hospitals have led to increased costs and the increased use of health care services, forced cutbacks in other services at full-service hospitals, and placed access to emergency and trauma services at risk.

“This practice strips full-service hospitals of critical resources needed to provide a full array of services that the community expects,” George Lynn, chairman of AHA's Board of Trustees and president of AtlantiCare in Atlantic City, N.J., said at a press conference.

AHA examined the impact of specialty hospitals on patients, communities, and full-service hospitals in Lincoln, Neb.; Oklahoma City; Wichita, Kan.; and the Black Hills region of South Dakota.

When these hospitals entered a community, access to emergency and trauma care was put at risk, the report found. And full-service community hospitals made cuts in areas such as behavioral health care, outpatient clinics for low-income patients, health education and awareness, and medical education.

In addition, investments in new technologies were delayed or cut altogether, Mr. Lynn said.

The report also found physician-owned specialty hospitals focused on higher-reimbursed services. “These physician-owned, limited-service hospitals seem to be experts at choosing patients and services that are most financially rewarding and steering them to their own facilities,” he said.

But Randolph B. Fenninger, Washington representative for the American Surgical Hospital Association (ASHA), the trade group for physician-owned specialty hospitals, said continuing the moratorium is unnecessary.

Instead, Mr. Fenninger said the ASHA supports making changes to the diagnosis-related-group prospective payment system to better reflect the cost of care. The Medicare Payment Advisory Commission recently recommended that Congress extend the moratorium another 18 months, to study the impact of the hospitals and implement payment changes.

However, the payment changes alone won't be enough to alter current incentives, Mr. Lynn said. AHA plans to continue to work with members of Congress to make the moratorium permanent.

The American Hospital Association is calling on Congress to permanently ban the practice of self-referral of patients to new physician-owned specialty hospitals.

Congress placed an 18-month moratorium on the construction of new physician-owned specialty hospitals under the Medicare Modernization Act of 2003. The moratorium is set to expire in June.

In a new report, the American Hospital Association (AHA) contends that physician-owned specialty hospitals have led to increased costs and the increased use of health care services, forced cutbacks in other services at full-service hospitals, and placed access to emergency and trauma services at risk.

“This practice strips full-service hospitals of critical resources needed to provide a full array of services that the community expects,” George Lynn, chairman of AHA's Board of Trustees and president of AtlantiCare in Atlantic City, N.J., said at a press conference.

AHA examined the impact of specialty hospitals on patients, communities, and full-service hospitals in Lincoln, Neb.; Oklahoma City; Wichita, Kan.; and the Black Hills region of South Dakota.

When these hospitals entered a community, access to emergency and trauma care was put at risk, the report found. And full-service community hospitals made cuts in areas such as behavioral health care, outpatient clinics for low-income patients, health education and awareness, and medical education.

In addition, investments in new technologies were delayed or cut altogether, Mr. Lynn said.

The report also found physician-owned specialty hospitals focused on higher-reimbursed services. “These physician-owned, limited-service hospitals seem to be experts at choosing patients and services that are most financially rewarding and steering them to their own facilities,” he said.

But Randolph B. Fenninger, Washington representative for the American Surgical Hospital Association (ASHA), the trade group for physician-owned specialty hospitals, said continuing the moratorium is unnecessary.

Instead, Mr. Fenninger said the ASHA supports making changes to the diagnosis-related-group prospective payment system to better reflect the cost of care. The Medicare Payment Advisory Commission recently recommended that Congress extend the moratorium another 18 months, to study the impact of the hospitals and implement payment changes.

However, the payment changes alone won't be enough to alter current incentives, Mr. Lynn said. AHA plans to continue to work with members of Congress to make the moratorium permanent.

Family Planning Funding

Over the last few years, federal and state support for family planning has leveled off or declined as more U.S. women of reproductive age have become uninsured or have qualified for publicly subsidized care, according to an analysis conducted by the Alan Guttmacher Institute. This trend could intensify if proposed cuts to Medicaid are enacted, the group said. In 2002, 16.8 million women are estimated to have needed publicly supported contraceptive care, according the institute, but clinics were able to serve only 4 in 10 of these women. Nancy Keenan, president of NARAL Pro-Choice America, said the research points to the need for Congress to increase funding for family planning program Title X, which provides information on contraception.

Roe v. Wade

The U.S. Supreme Court recently refused to hear an appeal of the 1973 ruling in Roe v. Wade. Norma McCorvey, the original “Jane Roe” in the 1973 case, asked the court to reverse its decision on Roe v. Wade or to order a new trial. She cited testimony from more than 1,000 women who say they have been hurt by abortion. Federal rules allow an original party to a case to request that a ruling be vacated if factual and legal changes make the decision unjust. The court rejected the case without comment. The case was first filed in a district court in Dallas in June 2003. The court's decision was praised by abortion advocates such as the Planned Parenthood Federation of America. “It is especially important that the Supreme Court reaffirm its respect for women's reproductive rights and health now, when an antichoice House, antichoice Senate, and antichoice president are all working to restrict women's reproductive rights,” Planned Parenthood Interim President Karen Pearl said in a statement. But Ms. McCorvey's attorney, Allan Parker, said the court's decision is not a reaffirmation of the original Roe v. Wade decision. Instead, he said, the denial is just the court exercising its discretionary right not to review a lower court decision.

Securing Office of Women's Health

Lawmakers are trying ensure that the unique health needs of women are not overlooked by making permanent the women's health offices at five federal agencies. Rep. Carolyn Maloney (D.-N.Y.) and Rep. Deborah Pryce (R.-Ohio) introduced the Women's Health Office Act of 2005 (H.R. 949), which would establish a permanent office of women's health at the Department of Health and Human Services, the Agency for Healthcare Research and Quality, the Health Resources and Services Administration, the Centers for Disease Control and Prevention, and the Food and Drug Administration. Similar legislation was passed by the House in 2002 but was not considered in the Senate. There are currently two women's health offices that are federally authorized—the Office of Research on Women's Health at the National Institutes of Health and the Office of Women's Services at the Substance Abuse and Mental Health Services Administration. “This proposal has had widespread support in the past, and I hope this Congress will finally enact it into law,” Rep. Maloney said in a statement.

Mandatory HIV Testing

Nearly two-thirds of physicians and members of the general public say that mandatory, federally funded HIV testing would improve the overall health of the U.S. population, according to a recent survey. HCD Research, a marketing and communications research company based in Flemington, N.J., conducted a national survey of 864 physicians and 1,339 nonphysicians in February. About 63% of the general public said that federally funded, mandatory HIV testing would improve public health, compared with 64% of the physician sample. Most of those surveyed (60% of the general public and 59% of physicians) said the associated health care benefits of mandatory, federally funded testing would outweigh the social implications.

Pay-for-Performance Principles

Any “pay-for-performance” program should offer voluntary physician participation and foster the relationship between physician and patient, the American Medical Association asserted in a new set of principles for such programs. Such a program should also use accurate data and fair reporting and ensure quality of care, the AMA stated. If done improperly, “some so-called pay-for-performance programs are a lose-lose proposition for patients and their physicians with the only benefit accruing to health insurers,” AMA Secretary John H. Armstrong, M.D., said in a statement. Both private and public sector organizations have started offering incentive payments to physicians based on an appraisal of their performance. Before taking on such reforms, however, Congress should try to fix Medicare's flawed payment formula, according to recent AMA testimony.

Family Planning Funding

Over the last few years, federal and state support for family planning has leveled off or declined as more U.S. women of reproductive age have become uninsured or have qualified for publicly subsidized care, according to an analysis conducted by the Alan Guttmacher Institute. This trend could intensify if proposed cuts to Medicaid are enacted, the group said. In 2002, 16.8 million women are estimated to have needed publicly supported contraceptive care, according the institute, but clinics were able to serve only 4 in 10 of these women. Nancy Keenan, president of NARAL Pro-Choice America, said the research points to the need for Congress to increase funding for family planning program Title X, which provides information on contraception.

Roe v. Wade

The U.S. Supreme Court recently refused to hear an appeal of the 1973 ruling in Roe v. Wade. Norma McCorvey, the original “Jane Roe” in the 1973 case, asked the court to reverse its decision on Roe v. Wade or to order a new trial. She cited testimony from more than 1,000 women who say they have been hurt by abortion. Federal rules allow an original party to a case to request that a ruling be vacated if factual and legal changes make the decision unjust. The court rejected the case without comment. The case was first filed in a district court in Dallas in June 2003. The court's decision was praised by abortion advocates such as the Planned Parenthood Federation of America. “It is especially important that the Supreme Court reaffirm its respect for women's reproductive rights and health now, when an antichoice House, antichoice Senate, and antichoice president are all working to restrict women's reproductive rights,” Planned Parenthood Interim President Karen Pearl said in a statement. But Ms. McCorvey's attorney, Allan Parker, said the court's decision is not a reaffirmation of the original Roe v. Wade decision. Instead, he said, the denial is just the court exercising its discretionary right not to review a lower court decision.

Securing Office of Women's Health

Lawmakers are trying ensure that the unique health needs of women are not overlooked by making permanent the women's health offices at five federal agencies. Rep. Carolyn Maloney (D.-N.Y.) and Rep. Deborah Pryce (R.-Ohio) introduced the Women's Health Office Act of 2005 (H.R. 949), which would establish a permanent office of women's health at the Department of Health and Human Services, the Agency for Healthcare Research and Quality, the Health Resources and Services Administration, the Centers for Disease Control and Prevention, and the Food and Drug Administration. Similar legislation was passed by the House in 2002 but was not considered in the Senate. There are currently two women's health offices that are federally authorized—the Office of Research on Women's Health at the National Institutes of Health and the Office of Women's Services at the Substance Abuse and Mental Health Services Administration. “This proposal has had widespread support in the past, and I hope this Congress will finally enact it into law,” Rep. Maloney said in a statement.

Mandatory HIV Testing

Nearly two-thirds of physicians and members of the general public say that mandatory, federally funded HIV testing would improve the overall health of the U.S. population, according to a recent survey. HCD Research, a marketing and communications research company based in Flemington, N.J., conducted a national survey of 864 physicians and 1,339 nonphysicians in February. About 63% of the general public said that federally funded, mandatory HIV testing would improve public health, compared with 64% of the physician sample. Most of those surveyed (60% of the general public and 59% of physicians) said the associated health care benefits of mandatory, federally funded testing would outweigh the social implications.

Pay-for-Performance Principles

Any “pay-for-performance” program should offer voluntary physician participation and foster the relationship between physician and patient, the American Medical Association asserted in a new set of principles for such programs. Such a program should also use accurate data and fair reporting and ensure quality of care, the AMA stated. If done improperly, “some so-called pay-for-performance programs are a lose-lose proposition for patients and their physicians with the only benefit accruing to health insurers,” AMA Secretary John H. Armstrong, M.D., said in a statement. Both private and public sector organizations have started offering incentive payments to physicians based on an appraisal of their performance. Before taking on such reforms, however, Congress should try to fix Medicare's flawed payment formula, according to recent AMA testimony.

Family Planning Funding

Over the last few years, federal and state support for family planning has leveled off or declined as more U.S. women of reproductive age have become uninsured or have qualified for publicly subsidized care, according to an analysis conducted by the Alan Guttmacher Institute. This trend could intensify if proposed cuts to Medicaid are enacted, the group said. In 2002, 16.8 million women are estimated to have needed publicly supported contraceptive care, according the institute, but clinics were able to serve only 4 in 10 of these women. Nancy Keenan, president of NARAL Pro-Choice America, said the research points to the need for Congress to increase funding for family planning program Title X, which provides information on contraception.

Roe v. Wade

The U.S. Supreme Court recently refused to hear an appeal of the 1973 ruling in Roe v. Wade. Norma McCorvey, the original “Jane Roe” in the 1973 case, asked the court to reverse its decision on Roe v. Wade or to order a new trial. She cited testimony from more than 1,000 women who say they have been hurt by abortion. Federal rules allow an original party to a case to request that a ruling be vacated if factual and legal changes make the decision unjust. The court rejected the case without comment. The case was first filed in a district court in Dallas in June 2003. The court's decision was praised by abortion advocates such as the Planned Parenthood Federation of America. “It is especially important that the Supreme Court reaffirm its respect for women's reproductive rights and health now, when an antichoice House, antichoice Senate, and antichoice president are all working to restrict women's reproductive rights,” Planned Parenthood Interim President Karen Pearl said in a statement. But Ms. McCorvey's attorney, Allan Parker, said the court's decision is not a reaffirmation of the original Roe v. Wade decision. Instead, he said, the denial is just the court exercising its discretionary right not to review a lower court decision.

Securing Office of Women's Health

Lawmakers are trying ensure that the unique health needs of women are not overlooked by making permanent the women's health offices at five federal agencies. Rep. Carolyn Maloney (D.-N.Y.) and Rep. Deborah Pryce (R.-Ohio) introduced the Women's Health Office Act of 2005 (H.R. 949), which would establish a permanent office of women's health at the Department of Health and Human Services, the Agency for Healthcare Research and Quality, the Health Resources and Services Administration, the Centers for Disease Control and Prevention, and the Food and Drug Administration. Similar legislation was passed by the House in 2002 but was not considered in the Senate. There are currently two women's health offices that are federally authorized—the Office of Research on Women's Health at the National Institutes of Health and the Office of Women's Services at the Substance Abuse and Mental Health Services Administration. “This proposal has had widespread support in the past, and I hope this Congress will finally enact it into law,” Rep. Maloney said in a statement.

Mandatory HIV Testing

Nearly two-thirds of physicians and members of the general public say that mandatory, federally funded HIV testing would improve the overall health of the U.S. population, according to a recent survey. HCD Research, a marketing and communications research company based in Flemington, N.J., conducted a national survey of 864 physicians and 1,339 nonphysicians in February. About 63% of the general public said that federally funded, mandatory HIV testing would improve public health, compared with 64% of the physician sample. Most of those surveyed (60% of the general public and 59% of physicians) said the associated health care benefits of mandatory, federally funded testing would outweigh the social implications.

Pay-for-Performance Principles

Any “pay-for-performance” program should offer voluntary physician participation and foster the relationship between physician and patient, the American Medical Association asserted in a new set of principles for such programs. Such a program should also use accurate data and fair reporting and ensure quality of care, the AMA stated. If done improperly, “some so-called pay-for-performance programs are a lose-lose proposition for patients and their physicians with the only benefit accruing to health insurers,” AMA Secretary John H. Armstrong, M.D., said in a statement. Both private and public sector organizations have started offering incentive payments to physicians based on an appraisal of their performance. Before taking on such reforms, however, Congress should try to fix Medicare's flawed payment formula, according to recent AMA testimony.

Medicare officials have proposed new uniform standards for electronic prescribing that will govern transactions between prescribers and dispensers of prescriptions.

Under the proposal, the standards would take effect in January, to coincide with the beginning of the new Medicare Part D prescription drug benefit. The proposed standards apply to transactions between prescribers and dispensers of new prescriptions, refill requests, prescription changes, and cancellation requests. In addition, the standards govern eligibility and benefits inquiries between prescribers and drug plans and Part D sponsors.

Additional electronic prescribing standards will be developed by 2008.

Electronic prescribing is voluntary for physicians, but the aim of the standards is to make it easier and more attractive for physicians to use the technology.

“These proposed e-prescription rules would set standards to help Medicare, physicians, and pharmacies take advantage of new technology that can improve the health care of seniors and persons with disabilities,” Health and Human Services Secretary Mike Leavitt said in a statement.

One of the most successful strategies for getting physicians to adopt electronic prescribing in their offices is to provide ongoing reimbursement, said Jonathan Teich, M.D., chief medical officer at Healthvision, an Internet health care company, who chaired the Electronic Prescribing Project of the eHealth Initiative.

Over the last few years, there's been a lot of work in both the public and private sectors examining what drives adoption of e-prescribing. What they have found is that there is money to be saved through the use of the technology, but it's usually saved by the payer, not by the physician, Dr. Teich said.

But payers and others can provide incentives to physicians by supplying the technology up front, giving increased reimbursement per visit for the use of electronic prescribing, or incorporating electronic prescribing into a pay-for-performance program, he said.

A group of health plans in Massachusetts has joined forces to cover the costs of electronic prescribing for physicians interested in integrating the technology into their practices.

Blue Cross Blue Shield of Massachusetts, Tufts Health Plan, and the Neighborhood Health Plan have partnered with the technology vendor ZixCorp to provide physicians in Massachusetts with the hardware and software needed for electronic prescribing.

The project is called the eRx Collaborative, and from October 2003 through the end of 2004, nearly 2,700 physicians and their clinical staff members signed up to participate in the project. At the end of last year, more than 1,500 doctors had incorporated the technology into their practices.

The collaborative plans to cover the costs of the e-prescribing technology through the end of this year.

The project uses ZixCorp's PocketScript e-prescribing system. This technology allows physicians to create new and refill prescriptions electronically and allows for real-time access to a patient's prescription history, as well as formulary and eligibility information. Physicians can access the program either through a secure Web site or a handheld device.

This year, physicians will also be able to choose to use DrFirst Inc.'s Rcopia electronic prescription management program.

Facilitating the adoption of electronic prescribing is a way to try to curb both high pharmacy costs and medication errors, said Robert Mandel, M.D., vice president of eHealth for Blue Cross Blue Shield of Massachusetts.

And electronic prescribing seems like a good solution because it would be easier to incorporate into the physician's workflow than an electronic health record, Dr. Mandel said. But he said he hopes that physicians will choose to move to a fully functional electronic health record in the future.

“We do believe that this is a transitional technology,” he said.

The project, which is the largest of its kind, could be a model for how to drive adoption of this technology, Dr. Mandel said.

James Whitman, M.D., a pediatrician in Framingham, Mass., and one of the physicians who received the electronic prescribing technology through the eRx Collaborative, said it's shown him how easy it can be to use.

Through electronic prescribing, he and his office staff have saved time, and his patients like it because they don't have to carry around prescriptions, he said.

Dr. Whitman and his colleagues plan to make the jump to full electronic health records when they replace their practice management system. “Our experience with this system makes it a little less scary,” Dr. Whitman said.

Medicare officials have proposed new uniform standards for electronic prescribing that will govern transactions between prescribers and dispensers of prescriptions.

Under the proposal, the standards would take effect in January, to coincide with the beginning of the new Medicare Part D prescription drug benefit. The proposed standards apply to transactions between prescribers and dispensers of new prescriptions, refill requests, prescription changes, and cancellation requests. In addition, the standards govern eligibility and benefits inquiries between prescribers and drug plans and Part D sponsors.

Additional electronic prescribing standards will be developed by 2008.

Electronic prescribing is voluntary for physicians, but the aim of the standards is to make it easier and more attractive for physicians to use the technology.

“These proposed e-prescription rules would set standards to help Medicare, physicians, and pharmacies take advantage of new technology that can improve the health care of seniors and persons with disabilities,” Health and Human Services Secretary Mike Leavitt said in a statement.

One of the most successful strategies for getting physicians to adopt electronic prescribing in their offices is to provide ongoing reimbursement, said Jonathan Teich, M.D., chief medical officer at Healthvision, an Internet health care company, who chaired the Electronic Prescribing Project of the eHealth Initiative.

Over the last few years, there's been a lot of work in both the public and private sectors examining what drives adoption of e-prescribing. What they have found is that there is money to be saved through the use of the technology, but it's usually saved by the payer, not by the physician, Dr. Teich said.

But payers and others can provide incentives to physicians by supplying the technology up front, giving increased reimbursement per visit for the use of electronic prescribing, or incorporating electronic prescribing into a pay-for-performance program, he said.

A group of health plans in Massachusetts has joined forces to cover the costs of electronic prescribing for physicians interested in integrating the technology into their practices.

Blue Cross Blue Shield of Massachusetts, Tufts Health Plan, and the Neighborhood Health Plan have partnered with the technology vendor ZixCorp to provide physicians in Massachusetts with the hardware and software needed for electronic prescribing.

The project is called the eRx Collaborative, and from October 2003 through the end of 2004, nearly 2,700 physicians and their clinical staff members signed up to participate in the project. At the end of last year, more than 1,500 doctors had incorporated the technology into their practices.

The collaborative plans to cover the costs of the e-prescribing technology through the end of this year.

The project uses ZixCorp's PocketScript e-prescribing system. This technology allows physicians to create new and refill prescriptions electronically and allows for real-time access to a patient's prescription history, as well as formulary and eligibility information. Physicians can access the program either through a secure Web site or a handheld device.

This year, physicians will also be able to choose to use DrFirst Inc.'s Rcopia electronic prescription management program.

Facilitating the adoption of electronic prescribing is a way to try to curb both high pharmacy costs and medication errors, said Robert Mandel, M.D., vice president of eHealth for Blue Cross Blue Shield of Massachusetts.

And electronic prescribing seems like a good solution because it would be easier to incorporate into the physician's workflow than an electronic health record, Dr. Mandel said. But he said he hopes that physicians will choose to move to a fully functional electronic health record in the future.

“We do believe that this is a transitional technology,” he said.

The project, which is the largest of its kind, could be a model for how to drive adoption of this technology, Dr. Mandel said.

James Whitman, M.D., a pediatrician in Framingham, Mass., and one of the physicians who received the electronic prescribing technology through the eRx Collaborative, said it's shown him how easy it can be to use.

Through electronic prescribing, he and his office staff have saved time, and his patients like it because they don't have to carry around prescriptions, he said.

Dr. Whitman and his colleagues plan to make the jump to full electronic health records when they replace their practice management system. “Our experience with this system makes it a little less scary,” Dr. Whitman said.

Medicare officials have proposed new uniform standards for electronic prescribing that will govern transactions between prescribers and dispensers of prescriptions.

Under the proposal, the standards would take effect in January, to coincide with the beginning of the new Medicare Part D prescription drug benefit. The proposed standards apply to transactions between prescribers and dispensers of new prescriptions, refill requests, prescription changes, and cancellation requests. In addition, the standards govern eligibility and benefits inquiries between prescribers and drug plans and Part D sponsors.

Additional electronic prescribing standards will be developed by 2008.

Electronic prescribing is voluntary for physicians, but the aim of the standards is to make it easier and more attractive for physicians to use the technology.

“These proposed e-prescription rules would set standards to help Medicare, physicians, and pharmacies take advantage of new technology that can improve the health care of seniors and persons with disabilities,” Health and Human Services Secretary Mike Leavitt said in a statement.

One of the most successful strategies for getting physicians to adopt electronic prescribing in their offices is to provide ongoing reimbursement, said Jonathan Teich, M.D., chief medical officer at Healthvision, an Internet health care company, who chaired the Electronic Prescribing Project of the eHealth Initiative.

Over the last few years, there's been a lot of work in both the public and private sectors examining what drives adoption of e-prescribing. What they have found is that there is money to be saved through the use of the technology, but it's usually saved by the payer, not by the physician, Dr. Teich said.

But payers and others can provide incentives to physicians by supplying the technology up front, giving increased reimbursement per visit for the use of electronic prescribing, or incorporating electronic prescribing into a pay-for-performance program, he said.

A group of health plans in Massachusetts has joined forces to cover the costs of electronic prescribing for physicians interested in integrating the technology into their practices.

Blue Cross Blue Shield of Massachusetts, Tufts Health Plan, and the Neighborhood Health Plan have partnered with the technology vendor ZixCorp to provide physicians in Massachusetts with the hardware and software needed for electronic prescribing.

The project is called the eRx Collaborative, and from October 2003 through the end of 2004, nearly 2,700 physicians and their clinical staff members signed up to participate in the project. At the end of last year, more than 1,500 doctors had incorporated the technology into their practices.

The collaborative plans to cover the costs of the e-prescribing technology through the end of this year.

The project uses ZixCorp's PocketScript e-prescribing system. This technology allows physicians to create new and refill prescriptions electronically and allows for real-time access to a patient's prescription history, as well as formulary and eligibility information. Physicians can access the program either through a secure Web site or a handheld device.

This year, physicians will also be able to choose to use DrFirst Inc.'s Rcopia electronic prescription management program.

Facilitating the adoption of electronic prescribing is a way to try to curb both high pharmacy costs and medication errors, said Robert Mandel, M.D., vice president of eHealth for Blue Cross Blue Shield of Massachusetts.

And electronic prescribing seems like a good solution because it would be easier to incorporate into the physician's workflow than an electronic health record, Dr. Mandel said. But he said he hopes that physicians will choose to move to a fully functional electronic health record in the future.

“We do believe that this is a transitional technology,” he said.

The project, which is the largest of its kind, could be a model for how to drive adoption of this technology, Dr. Mandel said.

James Whitman, M.D., a pediatrician in Framingham, Mass., and one of the physicians who received the electronic prescribing technology through the eRx Collaborative, said it's shown him how easy it can be to use.

Through electronic prescribing, he and his office staff have saved time, and his patients like it because they don't have to carry around prescriptions, he said.

Dr. Whitman and his colleagues plan to make the jump to full electronic health records when they replace their practice management system. “Our experience with this system makes it a little less scary,” Dr. Whitman said.

State Sets COX-2 Restrictions

Louisiana physicians now must document a specific medical need in order to prescribe cyclooxygenase-2 inhibitor (COX-2) drugs to Medicaid patients. Starting last month, Medicaid is filling COX-2 prescriptions only when medical need for these medications over an alternative pain reliever, such as ibuprofen, can be demonstrated. “This is an aggressive, responsible approach to patient safety that will ensure better health outcomes for our Medicaid recipients,” Fred Cerise, M.D., secretary of the Louisiana Department of Health and Hospitals, said in a statement. Under the new policy, a Medicaid patient cannot have a prescription for any such drug filled without documented medical justification from the prescriber. Kaiser Permanente recently made a similar move when it placed a 6-month moratorium on the dispensing of valdecoxib (Bextra) because of safety concerns.

Milk's Role in Children's Bone Health

Physical activity and a healthy diet do more to build strong bones in children and young adults than drinking milk does, according to research published in the March issue of Pediatrics. “To build strong bones and healthy bodies, children need exercise, sunshine, and a diet rich in fruits and vegetables that helps them maintain a healthy body weight,” Amy Lanou, Ph.D., the lead author of the study and nutrition director of the Physicians Committee for Responsible Medicine, said in a statement. But the analysis was dismissed by the National Dairy Council and the International Dairy Foods Association as “an opinion piece by three representatives of an animal rights organization that has only a 5% physician membership.” The groups said the study authors ignored decades of research endorsing dairy's role in bone health. They also pointed to consensus in the scientific and medical community, including the current calcium policy statement of the American Academy of Pediatrics.

Pay-for-Performance Principles

Any pay-for-performance program should offer voluntary physician participation and foster the relationship between physician and patient, the American Medical Association asserted in a new set of principles for such programs. Such programs should also use accurate data and fair reporting, provide program incentives, and ensure quality of care, the AMA stated. If done improperly, “some so-called pay-for-performance programs are a lose-lose proposition for patients and their physicians, with the only benefit accruing to health insurers,” AMA Secretary John H. Armstrong, M.D., said in a statement. Both public and private-sector groups have started offering incentive payments to physicians based on performance appraisals. Before taking on such reforms, however, Congress should try to fix Medicare's flawed payment formula, according to recent AMA testimony.

Cost of New Drug Benefit

National health care spending costs will remain stable during the next 10 years, though public programs will account for half of total spending, in part because of the new Medicare Part D prescription drug benefit, according to a report by the Centers for Medicare and Medicaid Services. The agency claims the drug benefit—which kicks in next January—is expected to “significantly” increase prescription drug use and reduce out-of-pocket spending for older patients without causing any major increase in the health care spending trend. However, the new benefit will result in a significant shift in funding from private payers and Medicaid to Medicare. Medicare spending is projected to grow almost 8% in 2004 and 8.5% in 2005, because of several changes in the program under the Medicare Modernization Act, such as positive physician updates and higher Medicare Advantage payment rates.

Clinical Trial Registry Legislation

Sen. Chuck Grassley (R-Iowa) and Sen. Christopher Dodd (D-Conn.) have introduced legislation to require drug makers to register clinical trials about prescription medicines. The bill is similar to legislation Sen. Dodd introduced in the last Congress, but it stipulates that

www.clinicaltrials.gov

Views on Physician-Assisted Suicide

More than half of physicians in a national survey say they believe it's ethical to assist a patient in committing suicide. Approximately 57% of the 1,000 physicians surveyed in the national poll said it was ethical, and 39% said it was unethical. In addition, 41% of the physicians surveyed would endorse the legalization of physician-assisted suicide under a wide variety of circumstances, 30% support its legalization in a few cases, and 29% oppose legalizing it in all cases. Although many physicians supported physician-assisted suicide as public policy, the results were mixed when it came to whether they would personally assist a suicide. The survey was conducted by HCD Research, a marketing and communications research company, and the Louis Finkelstein Institute for Religious and Social Studies.

State Sets COX-2 Restrictions

Louisiana physicians now must document a specific medical need in order to prescribe cyclooxygenase-2 inhibitor (COX-2) drugs to Medicaid patients. Starting last month, Medicaid is filling COX-2 prescriptions only when medical need for these medications over an alternative pain reliever, such as ibuprofen, can be demonstrated. “This is an aggressive, responsible approach to patient safety that will ensure better health outcomes for our Medicaid recipients,” Fred Cerise, M.D., secretary of the Louisiana Department of Health and Hospitals, said in a statement. Under the new policy, a Medicaid patient cannot have a prescription for any such drug filled without documented medical justification from the prescriber. Kaiser Permanente recently made a similar move when it placed a 6-month moratorium on the dispensing of valdecoxib (Bextra) because of safety concerns.

Milk's Role in Children's Bone Health

Physical activity and a healthy diet do more to build strong bones in children and young adults than drinking milk does, according to research published in the March issue of Pediatrics. “To build strong bones and healthy bodies, children need exercise, sunshine, and a diet rich in fruits and vegetables that helps them maintain a healthy body weight,” Amy Lanou, Ph.D., the lead author of the study and nutrition director of the Physicians Committee for Responsible Medicine, said in a statement. But the analysis was dismissed by the National Dairy Council and the International Dairy Foods Association as “an opinion piece by three representatives of an animal rights organization that has only a 5% physician membership.” The groups said the study authors ignored decades of research endorsing dairy's role in bone health. They also pointed to consensus in the scientific and medical community, including the current calcium policy statement of the American Academy of Pediatrics.

Pay-for-Performance Principles

Any pay-for-performance program should offer voluntary physician participation and foster the relationship between physician and patient, the American Medical Association asserted in a new set of principles for such programs. Such programs should also use accurate data and fair reporting, provide program incentives, and ensure quality of care, the AMA stated. If done improperly, “some so-called pay-for-performance programs are a lose-lose proposition for patients and their physicians, with the only benefit accruing to health insurers,” AMA Secretary John H. Armstrong, M.D., said in a statement. Both public and private-sector groups have started offering incentive payments to physicians based on performance appraisals. Before taking on such reforms, however, Congress should try to fix Medicare's flawed payment formula, according to recent AMA testimony.

Cost of New Drug Benefit

National health care spending costs will remain stable during the next 10 years, though public programs will account for half of total spending, in part because of the new Medicare Part D prescription drug benefit, according to a report by the Centers for Medicare and Medicaid Services. The agency claims the drug benefit—which kicks in next January—is expected to “significantly” increase prescription drug use and reduce out-of-pocket spending for older patients without causing any major increase in the health care spending trend. However, the new benefit will result in a significant shift in funding from private payers and Medicaid to Medicare. Medicare spending is projected to grow almost 8% in 2004 and 8.5% in 2005, because of several changes in the program under the Medicare Modernization Act, such as positive physician updates and higher Medicare Advantage payment rates.

Clinical Trial Registry Legislation

Sen. Chuck Grassley (R-Iowa) and Sen. Christopher Dodd (D-Conn.) have introduced legislation to require drug makers to register clinical trials about prescription medicines. The bill is similar to legislation Sen. Dodd introduced in the last Congress, but it stipulates that

www.clinicaltrials.gov

Views on Physician-Assisted Suicide

More than half of physicians in a national survey say they believe it's ethical to assist a patient in committing suicide. Approximately 57% of the 1,000 physicians surveyed in the national poll said it was ethical, and 39% said it was unethical. In addition, 41% of the physicians surveyed would endorse the legalization of physician-assisted suicide under a wide variety of circumstances, 30% support its legalization in a few cases, and 29% oppose legalizing it in all cases. Although many physicians supported physician-assisted suicide as public policy, the results were mixed when it came to whether they would personally assist a suicide. The survey was conducted by HCD Research, a marketing and communications research company, and the Louis Finkelstein Institute for Religious and Social Studies.

State Sets COX-2 Restrictions

Louisiana physicians now must document a specific medical need in order to prescribe cyclooxygenase-2 inhibitor (COX-2) drugs to Medicaid patients. Starting last month, Medicaid is filling COX-2 prescriptions only when medical need for these medications over an alternative pain reliever, such as ibuprofen, can be demonstrated. “This is an aggressive, responsible approach to patient safety that will ensure better health outcomes for our Medicaid recipients,” Fred Cerise, M.D., secretary of the Louisiana Department of Health and Hospitals, said in a statement. Under the new policy, a Medicaid patient cannot have a prescription for any such drug filled without documented medical justification from the prescriber. Kaiser Permanente recently made a similar move when it placed a 6-month moratorium on the dispensing of valdecoxib (Bextra) because of safety concerns.

Milk's Role in Children's Bone Health

Physical activity and a healthy diet do more to build strong bones in children and young adults than drinking milk does, according to research published in the March issue of Pediatrics. “To build strong bones and healthy bodies, children need exercise, sunshine, and a diet rich in fruits and vegetables that helps them maintain a healthy body weight,” Amy Lanou, Ph.D., the lead author of the study and nutrition director of the Physicians Committee for Responsible Medicine, said in a statement. But the analysis was dismissed by the National Dairy Council and the International Dairy Foods Association as “an opinion piece by three representatives of an animal rights organization that has only a 5% physician membership.” The groups said the study authors ignored decades of research endorsing dairy's role in bone health. They also pointed to consensus in the scientific and medical community, including the current calcium policy statement of the American Academy of Pediatrics.

Pay-for-Performance Principles

Any pay-for-performance program should offer voluntary physician participation and foster the relationship between physician and patient, the American Medical Association asserted in a new set of principles for such programs. Such programs should also use accurate data and fair reporting, provide program incentives, and ensure quality of care, the AMA stated. If done improperly, “some so-called pay-for-performance programs are a lose-lose proposition for patients and their physicians, with the only benefit accruing to health insurers,” AMA Secretary John H. Armstrong, M.D., said in a statement. Both public and private-sector groups have started offering incentive payments to physicians based on performance appraisals. Before taking on such reforms, however, Congress should try to fix Medicare's flawed payment formula, according to recent AMA testimony.

Cost of New Drug Benefit

National health care spending costs will remain stable during the next 10 years, though public programs will account for half of total spending, in part because of the new Medicare Part D prescription drug benefit, according to a report by the Centers for Medicare and Medicaid Services. The agency claims the drug benefit—which kicks in next January—is expected to “significantly” increase prescription drug use and reduce out-of-pocket spending for older patients without causing any major increase in the health care spending trend. However, the new benefit will result in a significant shift in funding from private payers and Medicaid to Medicare. Medicare spending is projected to grow almost 8% in 2004 and 8.5% in 2005, because of several changes in the program under the Medicare Modernization Act, such as positive physician updates and higher Medicare Advantage payment rates.

Clinical Trial Registry Legislation

Sen. Chuck Grassley (R-Iowa) and Sen. Christopher Dodd (D-Conn.) have introduced legislation to require drug makers to register clinical trials about prescription medicines. The bill is similar to legislation Sen. Dodd introduced in the last Congress, but it stipulates that

www.clinicaltrials.gov

Views on Physician-Assisted Suicide

More than half of physicians in a national survey say they believe it's ethical to assist a patient in committing suicide. Approximately 57% of the 1,000 physicians surveyed in the national poll said it was ethical, and 39% said it was unethical. In addition, 41% of the physicians surveyed would endorse the legalization of physician-assisted suicide under a wide variety of circumstances, 30% support its legalization in a few cases, and 29% oppose legalizing it in all cases. Although many physicians supported physician-assisted suicide as public policy, the results were mixed when it came to whether they would personally assist a suicide. The survey was conducted by HCD Research, a marketing and communications research company, and the Louis Finkelstein Institute for Religious and Social Studies.

The Medicare Payment Advisory Commission has recommended that Congress extend the moratorium on the development of new physician-owned specialty hospitals, but its chairman urged members of Congress not to close the door on these hospitals before the potential benefits can be fully investigated.

“Frankly, the status quo in our health care system is not great,” MedPAC chairman Glenn Hackbarth testified at a hearing of the Senate Finance Committee on specialty hospitals last month. “We've got real quality and cost issues.”

MedPAC members are concerned about the potential conflict of interest in physician-owned specialty hospitals, Mr. Hackbarth said, but they are not prepared to recommend outlawing them until they see evidence on whether specialty hospitals offer increased quality of care and efficiency.

And policymakers do not yet have the answers to those questions, he said.

Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, are drafting legislation that will set Medicare policy on specialty hospitals.

Sen. Grassley said that he will rely on the MedPAC findings as he drafts the legislation. He is also awaiting the final results of a study on quality of care at specialty hospitals from the Centers for Medicare and Medicaid Services.

Officials at CMS presented preliminary findings from that study at the hearing. CMS was charged under the Medicare Modernization Act of 2003 with examining referral patterns of specialty-hospital physician owners, assessing quality of care and patient satisfaction, and examining differences in the uncompensated care and tax payments between specialty hospitals and community hospitals.

Based on claims analysis, the preliminary results show that quality of care at cardiac hospitals was generally at least as good and in some cases better than the quality of care at community hospitals. Complication and mortality rates were also lower at cardiac specialty hospitals even when adjusted for severity of illness.

However, because of the small number of discharges, a statistically significant assessment could not be made for surgical and orthopedic hospitals, said Thomas A. Gustafson, Ph.D., deputy director of the Center for Medicare Management at CMS.

Patient satisfaction was high at cardiac, surgical, and orthopedic hospitals, Dr. Gustafson said, due to amenities like larger rooms and easy parking, adding that patients had a favorable perception of the clinical quality of care they received at the specialty hospitals.

But Sen. Baucus expressed skepticism about the findings and how the study was conducted. He urged caution in using the results of the CMS study as a basis for policymaking.

In its report to Congress, MedPAC recommended that the moratorium on construction of new specialty hospitals be extended another 18 months—until Jan. 1, 2007.

While MedPAC stopped short of recommending that Congress ban new specialty hospitals, the panel did recommend payment changes that would remove incentives for hospitals to treat healthier but more profitable patients.

First, the panel recommended that the secretary of Health and Human Services refine the current diagnosis-related groups (DRGs) to better capture differences in severity of illness among Medicare patients. The panel also advised the HHS secretary to base the DRG relative weights on the estimated cost of providing care, rather than on charges. And MedPAC recommended that Congress amend the law to allow the HHS secretary to adjust DRG relative weights to account for differences in the prevalence of high-cost outlier cases.

These changes would affect all hospitals that see Medicare patients and increase the accuracy and fairness of payments, Mr. Hackbarth said.

In addition, MedPAC tried to address physicians' concerns that they do not have a say in the management of community hospitals, by recommending that Congress allow the HHS secretary to permit “gainsharing” arrangements between physicians and hospitals.

Gainsharing aligns financial incentives for physicians and hospitals by allowing physicians to share in the cost savings realized from delivering efficient care in the hospital.

But even with these changes, Mr. Hackbarth said MedPAC members still have concerns about the impact of physician ownership on clinical decision making.

And members of the Senate Finance Committee also raised questions about the appropriateness of physician self-referral.

“When it comes to physician ownership of specialty hospitals, I'm not sure the playing field is level,” Sen. Baucus said.

Physicians are the ones who choose where patients will receive care, he said. He compared the physician owners of specialty hospitals to coaches who choose the starting lineup for both teams.

Advocates for specialty hospitals, including the American Medical Association and the American Surgical Hospital Association, are lobbying Congress to end the moratorium, saying it will allow competition and won't hurt community hospitals.

The Medicare Payment Advisory Commission has recommended that Congress extend the moratorium on the development of new physician-owned specialty hospitals, but its chairman urged members of Congress not to close the door on these hospitals before the potential benefits can be fully investigated.

“Frankly, the status quo in our health care system is not great,” MedPAC chairman Glenn Hackbarth testified at a hearing of the Senate Finance Committee on specialty hospitals last month. “We've got real quality and cost issues.”

MedPAC members are concerned about the potential conflict of interest in physician-owned specialty hospitals, Mr. Hackbarth said, but they are not prepared to recommend outlawing them until they see evidence on whether specialty hospitals offer increased quality of care and efficiency.

And policymakers do not yet have the answers to those questions, he said.

Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, are drafting legislation that will set Medicare policy on specialty hospitals.

Sen. Grassley said that he will rely on the MedPAC findings as he drafts the legislation. He is also awaiting the final results of a study on quality of care at specialty hospitals from the Centers for Medicare and Medicaid Services.

Officials at CMS presented preliminary findings from that study at the hearing. CMS was charged under the Medicare Modernization Act of 2003 with examining referral patterns of specialty-hospital physician owners, assessing quality of care and patient satisfaction, and examining differences in the uncompensated care and tax payments between specialty hospitals and community hospitals.

Based on claims analysis, the preliminary results show that quality of care at cardiac hospitals was generally at least as good and in some cases better than the quality of care at community hospitals. Complication and mortality rates were also lower at cardiac specialty hospitals even when adjusted for severity of illness.

However, because of the small number of discharges, a statistically significant assessment could not be made for surgical and orthopedic hospitals, said Thomas A. Gustafson, Ph.D., deputy director of the Center for Medicare Management at CMS.

Patient satisfaction was high at cardiac, surgical, and orthopedic hospitals, Dr. Gustafson said, due to amenities like larger rooms and easy parking, adding that patients had a favorable perception of the clinical quality of care they received at the specialty hospitals.

But Sen. Baucus expressed skepticism about the findings and how the study was conducted. He urged caution in using the results of the CMS study as a basis for policymaking.

In its report to Congress, MedPAC recommended that the moratorium on construction of new specialty hospitals be extended another 18 months—until Jan. 1, 2007.

While MedPAC stopped short of recommending that Congress ban new specialty hospitals, the panel did recommend payment changes that would remove incentives for hospitals to treat healthier but more profitable patients.

First, the panel recommended that the secretary of Health and Human Services refine the current diagnosis-related groups (DRGs) to better capture differences in severity of illness among Medicare patients. The panel also advised the HHS secretary to base the DRG relative weights on the estimated cost of providing care, rather than on charges. And MedPAC recommended that Congress amend the law to allow the HHS secretary to adjust DRG relative weights to account for differences in the prevalence of high-cost outlier cases.

These changes would affect all hospitals that see Medicare patients and increase the accuracy and fairness of payments, Mr. Hackbarth said.

In addition, MedPAC tried to address physicians' concerns that they do not have a say in the management of community hospitals, by recommending that Congress allow the HHS secretary to permit “gainsharing” arrangements between physicians and hospitals.

Gainsharing aligns financial incentives for physicians and hospitals by allowing physicians to share in the cost savings realized from delivering efficient care in the hospital.

But even with these changes, Mr. Hackbarth said MedPAC members still have concerns about the impact of physician ownership on clinical decision making.

And members of the Senate Finance Committee also raised questions about the appropriateness of physician self-referral.

“When it comes to physician ownership of specialty hospitals, I'm not sure the playing field is level,” Sen. Baucus said.

Physicians are the ones who choose where patients will receive care, he said. He compared the physician owners of specialty hospitals to coaches who choose the starting lineup for both teams.

Advocates for specialty hospitals, including the American Medical Association and the American Surgical Hospital Association, are lobbying Congress to end the moratorium, saying it will allow competition and won't hurt community hospitals.

The Medicare Payment Advisory Commission has recommended that Congress extend the moratorium on the development of new physician-owned specialty hospitals, but its chairman urged members of Congress not to close the door on these hospitals before the potential benefits can be fully investigated.

“Frankly, the status quo in our health care system is not great,” MedPAC chairman Glenn Hackbarth testified at a hearing of the Senate Finance Committee on specialty hospitals last month. “We've got real quality and cost issues.”

MedPAC members are concerned about the potential conflict of interest in physician-owned specialty hospitals, Mr. Hackbarth said, but they are not prepared to recommend outlawing them until they see evidence on whether specialty hospitals offer increased quality of care and efficiency.

And policymakers do not yet have the answers to those questions, he said.

Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, are drafting legislation that will set Medicare policy on specialty hospitals.

Sen. Grassley said that he will rely on the MedPAC findings as he drafts the legislation. He is also awaiting the final results of a study on quality of care at specialty hospitals from the Centers for Medicare and Medicaid Services.

Officials at CMS presented preliminary findings from that study at the hearing. CMS was charged under the Medicare Modernization Act of 2003 with examining referral patterns of specialty-hospital physician owners, assessing quality of care and patient satisfaction, and examining differences in the uncompensated care and tax payments between specialty hospitals and community hospitals.

Based on claims analysis, the preliminary results show that quality of care at cardiac hospitals was generally at least as good and in some cases better than the quality of care at community hospitals. Complication and mortality rates were also lower at cardiac specialty hospitals even when adjusted for severity of illness.

However, because of the small number of discharges, a statistically significant assessment could not be made for surgical and orthopedic hospitals, said Thomas A. Gustafson, Ph.D., deputy director of the Center for Medicare Management at CMS.

Patient satisfaction was high at cardiac, surgical, and orthopedic hospitals, Dr. Gustafson said, due to amenities like larger rooms and easy parking, adding that patients had a favorable perception of the clinical quality of care they received at the specialty hospitals.

But Sen. Baucus expressed skepticism about the findings and how the study was conducted. He urged caution in using the results of the CMS study as a basis for policymaking.

In its report to Congress, MedPAC recommended that the moratorium on construction of new specialty hospitals be extended another 18 months—until Jan. 1, 2007.

While MedPAC stopped short of recommending that Congress ban new specialty hospitals, the panel did recommend payment changes that would remove incentives for hospitals to treat healthier but more profitable patients.

First, the panel recommended that the secretary of Health and Human Services refine the current diagnosis-related groups (DRGs) to better capture differences in severity of illness among Medicare patients. The panel also advised the HHS secretary to base the DRG relative weights on the estimated cost of providing care, rather than on charges. And MedPAC recommended that Congress amend the law to allow the HHS secretary to adjust DRG relative weights to account for differences in the prevalence of high-cost outlier cases.

These changes would affect all hospitals that see Medicare patients and increase the accuracy and fairness of payments, Mr. Hackbarth said.

In addition, MedPAC tried to address physicians' concerns that they do not have a say in the management of community hospitals, by recommending that Congress allow the HHS secretary to permit “gainsharing” arrangements between physicians and hospitals.

Gainsharing aligns financial incentives for physicians and hospitals by allowing physicians to share in the cost savings realized from delivering efficient care in the hospital.

But even with these changes, Mr. Hackbarth said MedPAC members still have concerns about the impact of physician ownership on clinical decision making.

And members of the Senate Finance Committee also raised questions about the appropriateness of physician self-referral.

“When it comes to physician ownership of specialty hospitals, I'm not sure the playing field is level,” Sen. Baucus said.

Physicians are the ones who choose where patients will receive care, he said. He compared the physician owners of specialty hospitals to coaches who choose the starting lineup for both teams.

Advocates for specialty hospitals, including the American Medical Association and the American Surgical Hospital Association, are lobbying Congress to end the moratorium, saying it will allow competition and won't hurt community hospitals.

Health savings accounts and other consumer-directed insurance products can help lower health care utilization and encourage better health behaviors, according to an industry expert.

Consumers “begin to recognize that the behaviors that they have can lead to a health outcome that can actually cost them money in the long run,” said Doug Kronenberg, chief strategy officer for Lumenos, an Alexandria, Va.-based company that sells health savings accounts.

“And therefore they begin to think about changes in their behavior that can impact that health care,” he said.

When an employer or insurer combines that with a program that also shows consumers the financial benefits of changing their behavior and offers support tools, consumers really become engaged in their health care, Mr. Kronenberg said during a teleconference sponsored by the Kaiser Family Foundation.

Health Savings Accounts (HSAs) were authorized under the Medicare Modernization Act of 2003 and are portable accounts that consumers can use to pay for certain qualified medical expenses. The accounts are generally offered in conjunction with a high-deductible insurance plan, and both consumers and employers can contribute to the accounts.

HSAs and similar accounts, such as health reimbursement accounts, can also create big savings for employers, Mr. Kronenberg said. With these types of plans, consumers tend to see the money as their own, and utilization of health care services typically drops.

But Mila Kofman, J.D., assistant research professor at the Health Policy Institute at Georgetown University, Washington, said that HSAs coupled with high deductible plans are just shifting the cost burden for health care from the insurer and the employer to the consumer.

And one of the possible pitfalls of the plans is that consumers who are facing deductibles of $1,000 or more each year will simply forego needed medical care because they can't afford to pay for it.

Health savings accounts and other consumer-directed insurance products can help lower health care utilization and encourage better health behaviors, according to an industry expert.

Consumers “begin to recognize that the behaviors that they have can lead to a health outcome that can actually cost them money in the long run,” said Doug Kronenberg, chief strategy officer for Lumenos, an Alexandria, Va.-based company that sells health savings accounts.

“And therefore they begin to think about changes in their behavior that can impact that health care,” he said.

When an employer or insurer combines that with a program that also shows consumers the financial benefits of changing their behavior and offers support tools, consumers really become engaged in their health care, Mr. Kronenberg said during a teleconference sponsored by the Kaiser Family Foundation.

Health Savings Accounts (HSAs) were authorized under the Medicare Modernization Act of 2003 and are portable accounts that consumers can use to pay for certain qualified medical expenses. The accounts are generally offered in conjunction with a high-deductible insurance plan, and both consumers and employers can contribute to the accounts.

HSAs and similar accounts, such as health reimbursement accounts, can also create big savings for employers, Mr. Kronenberg said. With these types of plans, consumers tend to see the money as their own, and utilization of health care services typically drops.

But Mila Kofman, J.D., assistant research professor at the Health Policy Institute at Georgetown University, Washington, said that HSAs coupled with high deductible plans are just shifting the cost burden for health care from the insurer and the employer to the consumer.

And one of the possible pitfalls of the plans is that consumers who are facing deductibles of $1,000 or more each year will simply forego needed medical care because they can't afford to pay for it.

Health savings accounts and other consumer-directed insurance products can help lower health care utilization and encourage better health behaviors, according to an industry expert.

Consumers “begin to recognize that the behaviors that they have can lead to a health outcome that can actually cost them money in the long run,” said Doug Kronenberg, chief strategy officer for Lumenos, an Alexandria, Va.-based company that sells health savings accounts.

“And therefore they begin to think about changes in their behavior that can impact that health care,” he said.

When an employer or insurer combines that with a program that also shows consumers the financial benefits of changing their behavior and offers support tools, consumers really become engaged in their health care, Mr. Kronenberg said during a teleconference sponsored by the Kaiser Family Foundation.

Health Savings Accounts (HSAs) were authorized under the Medicare Modernization Act of 2003 and are portable accounts that consumers can use to pay for certain qualified medical expenses. The accounts are generally offered in conjunction with a high-deductible insurance plan, and both consumers and employers can contribute to the accounts.

HSAs and similar accounts, such as health reimbursement accounts, can also create big savings for employers, Mr. Kronenberg said. With these types of plans, consumers tend to see the money as their own, and utilization of health care services typically drops.

But Mila Kofman, J.D., assistant research professor at the Health Policy Institute at Georgetown University, Washington, said that HSAs coupled with high deductible plans are just shifting the cost burden for health care from the insurer and the employer to the consumer.

And one of the possible pitfalls of the plans is that consumers who are facing deductibles of $1,000 or more each year will simply forego needed medical care because they can't afford to pay for it.

Health savings accounts and other consumer-directed insurance products can help lower health care utilization and encourage better health behaviors, according to an industry expert.

Consumers “begin to recognize that the behaviors that they have can lead to a health outcome that can actually cost them money in the long run,” said Doug Kronenberg, chief strategy officer for Lumenos, an Alexandria, Va.-based company that sells health savings accounts.

“And therefore they begin to think about changes in their behavior that can impact that health care,” he said.

When an employer or insurer combines that with a program showing consumers the financial benefits of changing their behavior and offers support tools, consumers really become engaged in their health care, Mr. Kronenberg said in a teleconference sponsored by the Kaiser Family Foundation. For example, employers can create financial incentives for consumers to complete a health risk assessment.

Health savings accounts (HSAs) were authorized under the Medicare Modernization Act of 2003 and are portable accounts that consumers can use to pay for certain qualified medical expenses.

The accounts are generally offered in conjunction with a high-deductible insurance plan, and both consumers and employers can contribute to the accounts. HSAs and similar accounts, such as health reimbursement accounts, can also create big savings for employers, Mr. Kronenberg said. With these types of plans, consumers tend to see the money as their own, and utilization of health care services typically drops.

But Mila Kofman, J.D., assistant research professor at the Health Policy Institute at Georgetown University, Washington, said that HSAs coupled with high deductible plans are just shifting the cost burden for health care from the insurer and the employer to the consumer.

One of the possible pitfalls is that consumers who are facing large deductibles each year will forego needed medical care because they can't afford it. This could raise the cost of health care if consumers skip or delay screenings and other preventive care that identify problems early.

Health savings accounts and other consumer-directed insurance products can help lower health care utilization and encourage better health behaviors, according to an industry expert.

Consumers “begin to recognize that the behaviors that they have can lead to a health outcome that can actually cost them money in the long run,” said Doug Kronenberg, chief strategy officer for Lumenos, an Alexandria, Va.-based company that sells health savings accounts.

“And therefore they begin to think about changes in their behavior that can impact that health care,” he said.

When an employer or insurer combines that with a program showing consumers the financial benefits of changing their behavior and offers support tools, consumers really become engaged in their health care, Mr. Kronenberg said in a teleconference sponsored by the Kaiser Family Foundation. For example, employers can create financial incentives for consumers to complete a health risk assessment.

Health savings accounts (HSAs) were authorized under the Medicare Modernization Act of 2003 and are portable accounts that consumers can use to pay for certain qualified medical expenses.

The accounts are generally offered in conjunction with a high-deductible insurance plan, and both consumers and employers can contribute to the accounts. HSAs and similar accounts, such as health reimbursement accounts, can also create big savings for employers, Mr. Kronenberg said. With these types of plans, consumers tend to see the money as their own, and utilization of health care services typically drops.

But Mila Kofman, J.D., assistant research professor at the Health Policy Institute at Georgetown University, Washington, said that HSAs coupled with high deductible plans are just shifting the cost burden for health care from the insurer and the employer to the consumer.

One of the possible pitfalls is that consumers who are facing large deductibles each year will forego needed medical care because they can't afford it. This could raise the cost of health care if consumers skip or delay screenings and other preventive care that identify problems early.

Health savings accounts and other consumer-directed insurance products can help lower health care utilization and encourage better health behaviors, according to an industry expert.

Consumers “begin to recognize that the behaviors that they have can lead to a health outcome that can actually cost them money in the long run,” said Doug Kronenberg, chief strategy officer for Lumenos, an Alexandria, Va.-based company that sells health savings accounts.

“And therefore they begin to think about changes in their behavior that can impact that health care,” he said.

When an employer or insurer combines that with a program showing consumers the financial benefits of changing their behavior and offers support tools, consumers really become engaged in their health care, Mr. Kronenberg said in a teleconference sponsored by the Kaiser Family Foundation. For example, employers can create financial incentives for consumers to complete a health risk assessment.

Health savings accounts (HSAs) were authorized under the Medicare Modernization Act of 2003 and are portable accounts that consumers can use to pay for certain qualified medical expenses.

The accounts are generally offered in conjunction with a high-deductible insurance plan, and both consumers and employers can contribute to the accounts. HSAs and similar accounts, such as health reimbursement accounts, can also create big savings for employers, Mr. Kronenberg said. With these types of plans, consumers tend to see the money as their own, and utilization of health care services typically drops.

But Mila Kofman, J.D., assistant research professor at the Health Policy Institute at Georgetown University, Washington, said that HSAs coupled with high deductible plans are just shifting the cost burden for health care from the insurer and the employer to the consumer.

One of the possible pitfalls is that consumers who are facing large deductibles each year will forego needed medical care because they can't afford it. This could raise the cost of health care if consumers skip or delay screenings and other preventive care that identify problems early.

Policing 'Gainsharing'

A proposed “gainsharing” arrangement between a hospital and several cardiology groups would violate federal statutes, according to an advisory opinion from the Department of Health and Human Services Office of the Inspector General (OIG). However, OIG will not seek sanctions against the hospitals or cardiology groups because the proposed arrangement includes proper safeguards to protect against inappropriate reductions in services. Under the proposed gainsharing arrangement, a hospital would share with each of eight cardiology groups a percentage of the hospital's cost savings from the cardiology group's implementation of a number of cost reduction measures in cardiac catheterization laboratory procedures. The Office of theInspector General found that the arrangement would amount to an improper payment to induce reduction or limitation of services and would potentially generate prohibited remuneration under the antikickback statute. However, OIG will not take action because the arrangement includes safeguards such as utilizing historic and clinical measures to establish a floor for savings to any cardiology group. The proposed arrangement is transparent and would allow for public scrutiny and individual physician accountability for any adverse effects, according to the OIG opinion. “Simply put, many 'gainsharing' plans present substantial risks for both patient and program abuse—risks that are not present in the proposed arrangement,” according to the OIG opinion. The advisory opinion, which is available online at

http://oig.hhs.gov/fraud/docs/advisoryopinions/2005/ao0504.pdf

Antismoking Campaign

A group of former top federal health officials has asked a federal court to order the major tobacco companies to fund an independent public education and smoking prevention campaign directed at children and teens. In February, as part of an ongoing government case against the tobacco companies, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the government could not require the companies to turn over $280 billion in profits. However, the court offered the option of pursuing other remedies. The Citizens' Commission to Protect the Truth—a group of former U.S. secretaries of Health, Education, and Welfare, U.S. secretaries of Health and Human Services, U.S. surgeons general, and directors of the Centers for Disease Control and Prevention—submitted an amicus brief to the court offering the option of requiring the tobacco companies to fund the American Legacy Foundation's truth campaign. The truth campaign is the largest national youth smoking prevention campaign in the country.

Cost of New Drug Benefit

National health care spending costs will remain stable over the next 10 years, although public programs will account for half of total spending, in part because of the new Medicare Part D prescription drug benefit, according to a report by the Centers for Medicare and Medicaid Services. The agency claims that the drug benefit—which kicks in in January—is expected to “significantly” increase prescription drug use and reduce out-of-pocket spending for older patients without causing any major increase in the health care spending trend. However, the new benefit will result in a significant shift in funding from private payers and Medicaid to Medicare. Medicare spending is projected to grow almost 8% in 2004 and 8.5% in 2005, due to several changes in the program under the Medicare Modernization Act, such as positive physician updates and higher Medicare Advantage payment rates.

Clinical Trial Registry Legislation

Sen. Chuck Grassley (R-Iowa) and Sen. Christopher Dodd (D-Conn.) have introduced legislation to require drug makers to register clinical trials about prescription medicines. The bill is similar to legislation Sen. Dodd introduced in the last Congress, but it stipulates that

www.clinicaltrials.gov

Perceptions of the Drug Industry

Prescription drugs may be improving patients' lives, but 70% of 1,201 adults polled in a Kaiser Family Foundation survey thought the drug industry cared more about profits than people. Only 24% thought the companies were most concerned with developing new drugs that save lives and improve quality of life. People also blame drug companies for rising health care costs: Nearly 60% said prescription drugs increased overall medical costs because they were so expensive, compared with the 23% who said drugs lowered medical costs by reducing the need for expensive medical procedures and hospitalizations. In an earlier poll, Kaiser found that people were more likely to cite drug company profits than other causes as the major cost of rising health care. While not as popular as physicians or hospitals, drug companies were in fact viewed more favorably than oil or tobacco companies, according to the survey.

Policing 'Gainsharing'

A proposed “gainsharing” arrangement between a hospital and several cardiology groups would violate federal statutes, according to an advisory opinion from the Department of Health and Human Services Office of the Inspector General (OIG). However, OIG will not seek sanctions against the hospitals or cardiology groups because the proposed arrangement includes proper safeguards to protect against inappropriate reductions in services. Under the proposed gainsharing arrangement, a hospital would share with each of eight cardiology groups a percentage of the hospital's cost savings from the cardiology group's implementation of a number of cost reduction measures in cardiac catheterization laboratory procedures. The Office of theInspector General found that the arrangement would amount to an improper payment to induce reduction or limitation of services and would potentially generate prohibited remuneration under the antikickback statute. However, OIG will not take action because the arrangement includes safeguards such as utilizing historic and clinical measures to establish a floor for savings to any cardiology group. The proposed arrangement is transparent and would allow for public scrutiny and individual physician accountability for any adverse effects, according to the OIG opinion. “Simply put, many 'gainsharing' plans present substantial risks for both patient and program abuse—risks that are not present in the proposed arrangement,” according to the OIG opinion. The advisory opinion, which is available online at

http://oig.hhs.gov/fraud/docs/advisoryopinions/2005/ao0504.pdf

Antismoking Campaign

A group of former top federal health officials has asked a federal court to order the major tobacco companies to fund an independent public education and smoking prevention campaign directed at children and teens. In February, as part of an ongoing government case against the tobacco companies, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the government could not require the companies to turn over $280 billion in profits. However, the court offered the option of pursuing other remedies. The Citizens' Commission to Protect the Truth—a group of former U.S. secretaries of Health, Education, and Welfare, U.S. secretaries of Health and Human Services, U.S. surgeons general, and directors of the Centers for Disease Control and Prevention—submitted an amicus brief to the court offering the option of requiring the tobacco companies to fund the American Legacy Foundation's truth campaign. The truth campaign is the largest national youth smoking prevention campaign in the country.

Cost of New Drug Benefit

National health care spending costs will remain stable over the next 10 years, although public programs will account for half of total spending, in part because of the new Medicare Part D prescription drug benefit, according to a report by the Centers for Medicare and Medicaid Services. The agency claims that the drug benefit—which kicks in in January—is expected to “significantly” increase prescription drug use and reduce out-of-pocket spending for older patients without causing any major increase in the health care spending trend. However, the new benefit will result in a significant shift in funding from private payers and Medicaid to Medicare. Medicare spending is projected to grow almost 8% in 2004 and 8.5% in 2005, due to several changes in the program under the Medicare Modernization Act, such as positive physician updates and higher Medicare Advantage payment rates.

Clinical Trial Registry Legislation

Sen. Chuck Grassley (R-Iowa) and Sen. Christopher Dodd (D-Conn.) have introduced legislation to require drug makers to register clinical trials about prescription medicines. The bill is similar to legislation Sen. Dodd introduced in the last Congress, but it stipulates that

www.clinicaltrials.gov

Perceptions of the Drug Industry

Prescription drugs may be improving patients' lives, but 70% of 1,201 adults polled in a Kaiser Family Foundation survey thought the drug industry cared more about profits than people. Only 24% thought the companies were most concerned with developing new drugs that save lives and improve quality of life. People also blame drug companies for rising health care costs: Nearly 60% said prescription drugs increased overall medical costs because they were so expensive, compared with the 23% who said drugs lowered medical costs by reducing the need for expensive medical procedures and hospitalizations. In an earlier poll, Kaiser found that people were more likely to cite drug company profits than other causes as the major cost of rising health care. While not as popular as physicians or hospitals, drug companies were in fact viewed more favorably than oil or tobacco companies, according to the survey.

Policing 'Gainsharing'

A proposed “gainsharing” arrangement between a hospital and several cardiology groups would violate federal statutes, according to an advisory opinion from the Department of Health and Human Services Office of the Inspector General (OIG). However, OIG will not seek sanctions against the hospitals or cardiology groups because the proposed arrangement includes proper safeguards to protect against inappropriate reductions in services. Under the proposed gainsharing arrangement, a hospital would share with each of eight cardiology groups a percentage of the hospital's cost savings from the cardiology group's implementation of a number of cost reduction measures in cardiac catheterization laboratory procedures. The Office of theInspector General found that the arrangement would amount to an improper payment to induce reduction or limitation of services and would potentially generate prohibited remuneration under the antikickback statute. However, OIG will not take action because the arrangement includes safeguards such as utilizing historic and clinical measures to establish a floor for savings to any cardiology group. The proposed arrangement is transparent and would allow for public scrutiny and individual physician accountability for any adverse effects, according to the OIG opinion. “Simply put, many 'gainsharing' plans present substantial risks for both patient and program abuse—risks that are not present in the proposed arrangement,” according to the OIG opinion. The advisory opinion, which is available online at

http://oig.hhs.gov/fraud/docs/advisoryopinions/2005/ao0504.pdf

Antismoking Campaign

A group of former top federal health officials has asked a federal court to order the major tobacco companies to fund an independent public education and smoking prevention campaign directed at children and teens. In February, as part of an ongoing government case against the tobacco companies, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the government could not require the companies to turn over $280 billion in profits. However, the court offered the option of pursuing other remedies. The Citizens' Commission to Protect the Truth—a group of former U.S. secretaries of Health, Education, and Welfare, U.S. secretaries of Health and Human Services, U.S. surgeons general, and directors of the Centers for Disease Control and Prevention—submitted an amicus brief to the court offering the option of requiring the tobacco companies to fund the American Legacy Foundation's truth campaign. The truth campaign is the largest national youth smoking prevention campaign in the country.

Cost of New Drug Benefit

National health care spending costs will remain stable over the next 10 years, although public programs will account for half of total spending, in part because of the new Medicare Part D prescription drug benefit, according to a report by the Centers for Medicare and Medicaid Services. The agency claims that the drug benefit—which kicks in in January—is expected to “significantly” increase prescription drug use and reduce out-of-pocket spending for older patients without causing any major increase in the health care spending trend. However, the new benefit will result in a significant shift in funding from private payers and Medicaid to Medicare. Medicare spending is projected to grow almost 8% in 2004 and 8.5% in 2005, due to several changes in the program under the Medicare Modernization Act, such as positive physician updates and higher Medicare Advantage payment rates.

Clinical Trial Registry Legislation

Sen. Chuck Grassley (R-Iowa) and Sen. Christopher Dodd (D-Conn.) have introduced legislation to require drug makers to register clinical trials about prescription medicines. The bill is similar to legislation Sen. Dodd introduced in the last Congress, but it stipulates that

www.clinicaltrials.gov

Perceptions of the Drug Industry

Prescription drugs may be improving patients' lives, but 70% of 1,201 adults polled in a Kaiser Family Foundation survey thought the drug industry cared more about profits than people. Only 24% thought the companies were most concerned with developing new drugs that save lives and improve quality of life. People also blame drug companies for rising health care costs: Nearly 60% said prescription drugs increased overall medical costs because they were so expensive, compared with the 23% who said drugs lowered medical costs by reducing the need for expensive medical procedures and hospitalizations. In an earlier poll, Kaiser found that people were more likely to cite drug company profits than other causes as the major cost of rising health care. While not as popular as physicians or hospitals, drug companies were in fact viewed more favorably than oil or tobacco companies, according to the survey.

Most group practices are still using paper medical records, according to preliminary results from a survey by the Medical Group Management Association.

“Paper is still the dominant mode of data collection,” William F. Jessee, M.D., president and CEO of the Medical Group Management Association (MGMA) said in a webcast sponsored by the group.

But the scale is tipping, he said. About 20% of group practices report that they have an electronic health record of some kind. Another 8% have a dictation/transcription system for physician notes, combined with a document imaging management system for information received on paper.

“We're seeing a steady movement toward a paperless office,” Dr. Jessee said.

The preliminary findings are based on responses from about 1,000 group practices that responded to an electronic questionnaire. The second stage of the survey will include mailing more than 16,000 printed questionnaires to a sample of group practices across the country.

The survey is part of a contract from the Agency for Healthcare Research and Quality to MGMA's Center for Research and the University of Minnesota. The purpose is to provide a baseline measure of the use of information technologies in medical groups.

Challenges in transitioning to an electronic health record include knowing which product to buy, how to go about buying it, and how to implement the system, said David Brailer, M.D., national health information technology coordinator for the Department of Health and Human Services.

“Many groups stumble at every point along the way,” Dr. Brailer said.

The private industry is working to create a voluntary certification process for electronic health record products.

The American Health Information Management Association, the Healthcare Information and Management Systems Society, and the National Alliance for Health Information Technology have formed a nonprofit group—the Certification Commission for Healthcare Information Technology—that is planning to pilot a first-step certification process this summer.

HHS has already asked the industry for comments on how to design a mechanism that would allow physicians and other health care providers to share information across the health care system.

The agency is now reviewing the more than 500 responses on how to address the legal, economic, privacy, and technical concerns involved in creating an interoperable system, Dr. Brailer said.

Most group practices are still using paper medical records, according to preliminary results from a survey by the Medical Group Management Association.

“Paper is still the dominant mode of data collection,” William F. Jessee, M.D., president and CEO of the Medical Group Management Association (MGMA) said in a webcast sponsored by the group.

But the scale is tipping, he said. About 20% of group practices report that they have an electronic health record of some kind. Another 8% have a dictation/transcription system for physician notes, combined with a document imaging management system for information received on paper.

“We're seeing a steady movement toward a paperless office,” Dr. Jessee said.

The preliminary findings are based on responses from about 1,000 group practices that responded to an electronic questionnaire. The second stage of the survey will include mailing more than 16,000 printed questionnaires to a sample of group practices across the country.

The survey is part of a contract from the Agency for Healthcare Research and Quality to MGMA's Center for Research and the University of Minnesota. The purpose is to provide a baseline measure of the use of information technologies in medical groups.

Challenges in transitioning to an electronic health record include knowing which product to buy, how to go about buying it, and how to implement the system, said David Brailer, M.D., national health information technology coordinator for the Department of Health and Human Services.

“Many groups stumble at every point along the way,” Dr. Brailer said.

The private industry is working to create a voluntary certification process for electronic health record products.

The American Health Information Management Association, the Healthcare Information and Management Systems Society, and the National Alliance for Health Information Technology have formed a nonprofit group—the Certification Commission for Healthcare Information Technology—that is planning to pilot a first-step certification process this summer.

HHS has already asked the industry for comments on how to design a mechanism that would allow physicians and other health care providers to share information across the health care system.

The agency is now reviewing the more than 500 responses on how to address the legal, economic, privacy, and technical concerns involved in creating an interoperable system, Dr. Brailer said.

Most group practices are still using paper medical records, according to preliminary results from a survey by the Medical Group Management Association.

“Paper is still the dominant mode of data collection,” William F. Jessee, M.D., president and CEO of the Medical Group Management Association (MGMA) said in a webcast sponsored by the group.

But the scale is tipping, he said. About 20% of group practices report that they have an electronic health record of some kind. Another 8% have a dictation/transcription system for physician notes, combined with a document imaging management system for information received on paper.

“We're seeing a steady movement toward a paperless office,” Dr. Jessee said.

The preliminary findings are based on responses from about 1,000 group practices that responded to an electronic questionnaire. The second stage of the survey will include mailing more than 16,000 printed questionnaires to a sample of group practices across the country.

The survey is part of a contract from the Agency for Healthcare Research and Quality to MGMA's Center for Research and the University of Minnesota. The purpose is to provide a baseline measure of the use of information technologies in medical groups.

Challenges in transitioning to an electronic health record include knowing which product to buy, how to go about buying it, and how to implement the system, said David Brailer, M.D., national health information technology coordinator for the Department of Health and Human Services.

“Many groups stumble at every point along the way,” Dr. Brailer said.

The private industry is working to create a voluntary certification process for electronic health record products.

The American Health Information Management Association, the Healthcare Information and Management Systems Society, and the National Alliance for Health Information Technology have formed a nonprofit group—the Certification Commission for Healthcare Information Technology—that is planning to pilot a first-step certification process this summer.

HHS has already asked the industry for comments on how to design a mechanism that would allow physicians and other health care providers to share information across the health care system.

The agency is now reviewing the more than 500 responses on how to address the legal, economic, privacy, and technical concerns involved in creating an interoperable system, Dr. Brailer said.