Medicare for All: What Could It Mean for Anesthesia?
The past month has seen a burst of developments on the healthcare legislative and judicial fronts with potential to impact anesthesiologists and nurse anesthetists as well as all clinicians and institutions.
The House Democrats last week introduced comprehensive legislation to strengthen the Affordable Care Act (ACA), with an emphasis on protecting coverage for pre-existing conditions, lowering healthcare costs and reversing changes made by the Trump administration. At the same time, the Trump administration has called for a complete repeal of the ACA in support of a ruling by a district court judge in Texas late last year.
This eAlert focuses on yet another major healthcare development: the introduction in late February of the Medicare for All Act (HR 1384) (M4A) by Representative Pramila Jayapal (D-WA) and 106 fellow House Democrats. With the introduction of the new bill last week to strengthen the ACA, House Democrats have put M4A aside temporarily. But with support from several Democratic presidential candidates, M4A, or something like it, could be a key issue in the 2020 presidential election. It behooves anesthesia providers to familiarize themselves with the essentials of this sweeping legislation.
Essentially, the bill, which calls for implementation over two years, proposes extending Medicare coverage to all Americans, providing coverage for comprehensive services (including the 10 categories of essential health benefits outlined in the ACA and four additional benefit categories), eliminating all co-pays and deductibles, virtually eliminating private insurance and overhauling the way in which physicians and healthcare providers are reimbursed. The proposal suggests that blending all coverage into one program would reduce administrative costs and enable Medicare to set physicians' fees and negotiate drug prices, according to sponsors.
As proposed, the single payer bill would provide hospitals an annual prepaid budget to cover each facility's costs for the year, administered by regional offices established by HHS. According to a comprehensive article on Health Affairs Blog by healthcare policy analyst Katie Keith, JD, institutions would "receive a lump sum payment for all operating expenses for covered services, both inpatient and outpatient, pursuant to a global budget set by the Secretary and disbursed to each regional office." That budget would include wages and salaries for physicians, nurses and ancillary staff.
Budgets would be negotiated by each institution and their regional office, based on volume of services, actual expenditures, wages, provider capacity and other factors, using the Medicare prospective payment systems as a reference in the first year.
Individual clinicians and groups would be paid according to a fee schedule developed with consideration for the current Medicare fee schedule, with clinician expertise and value of services weighed in the equation. (By our estimate, the single payer system's use of the MFS to determine payment would result in a 20 to 30 percent reduction in physician income.) Groups could opt to receive a salary from their institution under the global budget rather than the M4A fee schedule, but these salaries would have to be equivalent to other negotiated rates.
Payment would come through a uniform national electronic billing system. A physician practice review board would evaluate the quality and cost-effectiveness of care in determining physician reimbursement, and a public, standardized system would evaluate physician services on a regular basis.
The bill calls for data collection on physicians' services to determine relative values, and a timeline to track the services identified for review and the relative values adjusted.
Not surprisingly, the insurance industry and hospital and medical groups have come out strongly against the proposal. The American Hospital Association said M4A represents a "one-size-fits-all" approach that "would disrupt coverage for the more than 180 million Americans who are covered by employer-sponsored health plans." The likelihood of reduced reimbursements to providers also would exacerbate existing problems of access to care, AHA said.
Similarly, the Federation of American Hospitals argued that "we have a structure that frankly works for most Americans. Let's make it work for all Americans."
But Rep. Jayapal and many of her fellow Congressmen assert that the current healthcare system "is ineffective, inefficient and outrageously expensive. It is time to remove the profit motive in healthcare, to resolve the inefficiencies and to guarantee quality, therapeutic healthcare to every person living in the United States."
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