Stimulus package part of down payment on health reform

Stimulus legislation enacted in the first two months of President Obama's administration show that the White House is serious about health care reform.

Question: When will President Obama take on health care reform?

Answer: He already has.

Within his first five weeks in office, President Obama can point to enactment of two major pieces of health reform legislation. One is re-authorization of the State's Children's Health Insurance Program (SCHIP), which will provide coverage to an additional 4 million children, funded principally by raising the cigarette tax from 39 cents to $1 a pack.

The other is the health care “down payment” included in the $790 billion economic stimulus package.

The president insisted that the economic stimulus package include funding for programs to make health care more efficient and effective:

Electronic health records ($20 billion). Starting in 2011 and 2012, physicians and other providers who purchase a certified electronic health record (EHR) and use it for “meaningful purposes,” like electronic prescribing or reporting on quality measures, could qualify for up to $44,000 in higher Medicare payments, to be paid out in annual increments over five years.

The incentive is staggered, though, so that the longer a physician waits to adopt a certified EHR, the less Medicare pays. For instance, a physician who waits until 2013 to buy and use a certified EHR would qualify for up to $39,000 in Medicare incentive payments; a physician who waits until 2014 would get up to $24,000. A physician who waits until 2015 would not get any additional Medicare payments. Starting in 2016, physicians who still have not adopted a certified EHR could be subject to Medicare payment cuts.

Comparative effectiveness research (CER). The National Institutes of Health and the Agency for Healthcare Research and Quality will receive $1.1 billion in funding to “conduct or support research to evaluate and compare the clinical outcomes, effectiveness, risk, and benefits of two or more medical treatments and services that address a particular medical condition.”

More money for primary care and prevention. $500 million will be spent to train physicians, nurses, and dentists through the National Health Services Corps and the scholarship and loan repayment programs funded under Title VII and Title VIII of the Public Health Service Act. It includes $1.1 billion for a Wellness and Prevention Fund to support programs to increase immunization rates, promote clinical and community-based wellness and prevention strategies, and achieve measurable improvements in treatment and prevention of chronic illnesses.

Money for Medicaid and the uninsured. The legislation provides funds to subsidize and extend COBRA coverage for people who are temporarily out-of-work and help states offset the costs of Medicaid.

Other provisions in the legislation will give more money to community health centers and the National Institutes of Health.

Controversy and misinformation

With a few caveats, the College strongly supported the health care “down payment” in the stimulus legislation. (ACP did not take any position on other programs funded out of the legislation, unrelated to health care, or on whether the total package will have the desired impact on the economy.)

The health programs funded by the stimulus bill directly reflect the College's top priorities: helping people keep their health insurance, providing positive financial assistance to physicians to help overcome the cost barriers to EHR adoption; training of more primary care physicians; and funding to provide physicians and patients with independent, transparent, and evidence-based information on the relative effectiveness of different treatments as a tool to inform decision-making at the point of care. The College expressed concern about Medicare payment cuts that will go into effect for physicians who do not adopt a certified EHR.

Several of the health programs funded by the legislation ended up being surprisingly controversial. In particular, a few very vocal critics alleged that the health information technology and comparative effectiveness programs will lead to rationing and denial of care to older Americans. One even compared it to Nazi Germany's policies of forced euthanasia!

In fact, the legislation states that CER may not be used to mandate coverage, reimbursement or other policies by public and private payers. Instead, the intent is to provide clinicians and their patients with evidence-based, unbiased information on the relative effectiveness of different treatments to help them make their own treatment decisions.

The legislation does not give the federal government authority to use EHRs to track the treatment decisions that physicians make on behalf of their patients, another misrepresentation made by several critics. Actually, the legislation puts in place tougher protections for patient privacy.

The stimulus legislation tells us two things. One is that the Obama administration is serious about health care reform, even as it is pursued in stages, rather than in one single massive overhaul. The second, regrettably, is that the health care reform debate won't be conducted without the fear-mongering that marred past efforts to reach a consensus.