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Summer 2008

Getting A Political Return On Investment

Cindy Roehr, CPA
Legislative Liaison, MGMA Anesthesia Administration Assembly, Cedar Rapids, IA

To most, the phrase “return on investment” means the profit from your savings or retirement plan. After all, an investment is an asset that you put to work with the idea that it will grow and provide income in the future. Even conventional accounting practices recognize this, which is why some expenditures are considered assets, while others are considered expenses.

But as practicing physicians, you should consider two other expenditures as investments, even if they show up on your profit-and-loss statement as expenses: 1) your state and national professional association dues, and 2) your practice executive (manager or administrator). Both will pay you back through political involvement, also known as public advocacy or government affairs.

Associations Literally Add Value

During medical school and residency, you probably didn’t get a chance to come up for air long enough to see what your state and national medical and specialty societies were doing for you. At that point in your career, you were investing in yourself. Now that you’ve entered the world of professional practice, consider becoming more fully engaged in two of the critical functions that state and national associations generally perform: ongoing clinical education and political advocacy.

Advocacy at the state level is increasing in importance. Scope of practice, managed care, insurance law, tort reform, and medical assistance payments are all issues anesthesiologists are encountering at the state level. Your national association, the American Society of Anesthesiologists (ASA) (, monitors all of these issues (and more), and has staff and resources dedicated to sharing solutions and tactics through its Washington D.C.-based Office of Government and Legal Affairs. The Medical Group Management Association (MGMA) also has a government affairs office that works in concert with ASA Government Affairs to advance the interests of physicians in general and anesthesiologists in particular.

In addition, although national payment issues have dominated recent discussions, state initiatives have become a focal point of the annual ASA Legislative Conference. This exceptional conference, usually held in May, provides valuable information and training. The speakers provide examples of challenges that have been fought and successful tactics that have been employed.

On that front, this article was written during the summer debate on reversing the impending Medicare payment cuts, and the final outcome of that battle was unknown. But lost in the weeds of today’s heated debate is the substantial increase in the anesthesia payment rate that took effect at the beginning of 2008, a political “overnight success” that was years in the making.

The ASA took a multifaceted approach to securing the 32% increase in the conversion factor work value. Their hard work and persistence cannot be overlooked. Your ASA dues were part of the investment in this, but they were not the only investment. Your contributions to—and your investment in—the ASA Political Action Committee (PAC) and state society PACs were, and continue to be, just as important! The power wielded by any PAC is proportionate to its size.

Money Changes Everything?

Many science professionals take a jaundiced eye toward investing hard-earned money in a PAC or making a direct political contribution. But neither deserves the bad rap.

Do PAC and political contributions buy success? No. So, do they matter? Yes. Politics is not a science but an art—the art of the possible, some say—and because money is the fuel of the political message process, the answer is, “Absolutely yes!”

PAC contributions allow for an investment in those lawmakers (in both parties) who support anesthesiology and medical issues on “The Hill” and in your state capital. It is exciting to now have a Maryland anesthesiologist, Andy Harris, MD, running for Congress. If he wins, he will be a beacon to lead the House on health-care-related issues during the next, possibly dynamic, session of Congress.

While a Maryland State Senator, Harris once presented this stark picture: The typical trial attorney gives $1,000 to his PAC, and 90% of his peers give something. The typical anesthesiologist gives $100 to his PAC, and 10% of his peers give something. Simple math explains the tort reform story: $1,000×90% = $900. $100×10% = $10—a 90:1 advantage for trial lawyers! Tort reform is only one area of legislation—similar statistics can be given regarding the American Association of Nurse Anesthetists (AANA).

Issues regarding scope of practice continue to increase throughout the nation. We all know that money talks – and the more there is, the louder it speaks.

Here is another math equation that may help. Let’s say you perform a mere 800 cases/year with an average of 10 units per case. Let’s presume that 40% are Medicare, paid in the first half of 2008 at an average conversion factor of $20.03 — a nice $3.87 increase from the 2006 payment rate—and that your practice operates at a fairly typical 10% overhead rate. Quick calculations show that ASA’s investment in the political process put more than $5,000 in your pocket during the first six months alone! How much of that have you thought about investing back into the ASA or your state or local PAC?

The bottom line in this investment: If you don’t give, you don’t care.

The Practice Executive: Overhead or Investment?

Trust us when we write this—many practice executives face the unrealistic expectation of paying for themselves annually, either through cost reductions or revenue increases. Viewed as an expense, it’s no wonder this pressure exists to pay for their existence. View practice administrators as an investment, however, and you begin to see how it can pay dividends for you and your practice, particularly in the political arena.

If a practice executive does not have public advocacy and political involvement in his or her job description, then it is time to rewrite it. As the medical practice business leader is given key responsibilities for revenues and expenses, politics and community involvement is part of the job. Your practice executive can help your community understand the impact that inadequate Medicare and Medicaid payments have on your practice and the community. They can educate others about how Medicare fees are NOT physician profits but are instead “patient care payments” that fund the entire medical system.

On the revenue side, there are key regulations dealing with health maintenance organizations (HMOs), preferred provider organizations (PPOs) and other insurance products to understand. Medical assistance fee schedules are state-focused, and Medicare fee schedules are part of the national political scene. The ability to use anesthesiologist assistants (AAs) to meet expanding demand requires state licensing. Efforts to streamline credentialing take place on both the state and national levels. MGMA has been a leader on the national level to simplify credentialing and other administrative requirements with regard to both public and private payers. Providing support to your administrator’s MGMA membership also provides support to these important initiatives. Compliance with billing policies and regulations, and changing them when necessary, requires political savvy.

On the expense side, there are payroll and employment laws, pension and benefits administration rules, and even facility and safety regulations to follow. Plus, there is tort reform, often an area where substantial overhead reductions can be made.

Political affairs affect all elements of the medical practice executive’s job, and the elements of the job make the practice better for you and your patients. Your practice executive can help you:

  • Draft communications;
  • Arrange visits with state and federal lawmakers;
  • Create a regional PAC;
  • Serve as your “rapid response team;”
  • Create your talking points;
  • Make appointments with legislators and accompany you on them;
  • Connect the dots—your patients are your legislator’s constituents, and by growing your billing office you create jobs again affecting potential voters!
  • Provide advocacy training to you and other physicians;
  • Serve as the sentinel for the group, monitoring what happens outside the hospital walls; and
  • Serve on advisory committees created by associations and politicians.

While you provide patient care, your practice executive is available during the business day (and sometimes the evening) to deliver your message to the legislature and to the members of Congress. He or she can become a “go-to” resource for legislative staff, providing facts and education to those who help form policies and laws.

Government and political relationships are like other investments. To maximize their benefits, they take time, energy, and money. If you already invest in your association and your practice manager, congratulations! If you don’t, it’s not too late to start!

The ASA advocates 1:1:1—contribute the funds from one case to the ASA PAC, contribute the time from one day to lobbying at your state capitol (or working in place of one of your peers so he or she can), and work to develop a relationship with one politician. For more information, visit the ASA PAC section of the American Society of Anesthesiologists Web site. Be sure to have your membership number handy to access this members-only site!