Center for Medicare Services bows to American Medical Association House of Delegates by suspending Medicare PFFS plans. Politicians are the best that AMA lobby can buy.
AMERICAN MEDICAL ASSOCIATION HOUSE OF DELEGATES
Resolution: 110
(A-07)
Introduced by: California Delegation
Subject: Elimination of Medicare Private Fee-For-Service Plans
Referred to: Reference Committee A
(Virginia E. Hall, MD, Chair)
Whereas, Medicare Private Fee-For-Service health plans (PFFS)—one type of Medicare Advantage Plan established by Congress under the Medicare Modernization Act of 2003—are authorized under federal law to unfairly deem any physician participating in the Medicare program to be contracted with such plans if the physician treats a PFFS-enrolled patient, even though the physician has not signed a contract with the PFFS plan; and
Whereas, PFFS plans may pay physicians for medical services at Medicare allowable rates, but they must adhere to the PFFS plans other terms and conditions which are subject to change at any time and may include utilization review rules and other requirements, and do not conform with Medicare payment rules; and
Whereas, Federal law stipulates that PFFS plans do not have to demonstrate that they have an adequate network of physicians because they have the authority to deem that a physician is bound by the plans contract terms, and as a result these plans have no incentive to negotiate fair contract terms with physicians to ensure that patients have adequate access to medical services; and
Whereas, The federal government pays PFFS plans an average of 119% of the amount Medicare pays per patient for the standard Medicare fee-for-service program, creating a substantial financial incentive for private insurers to market PFFS plans which has spurred a 270% growth rate and represents nearly half of the growth in enrollment in Medicare Advantage plans over the past two years; and
Whereas, Medicare Advantage plans are paying 4 to 5 times higher commissions to brokers to market PFFS and there have been well-documented marketing abuses against seniors which include illegal door-to-door soliciting, misleading promises that patients can continue to be treated by their existing physician, and failure to disclose that the plans often have higher co-payments and fewer benefits than what is available in other Medicare Advantage plans or under standard Medicare coverage if they are also covered by the Medicaid program; and
Whereas, Higher payments from Medicare, elimination of an incentive to negotiate competitive contract terms with physicians due to the deeming authority given to PFFS plans, and the ability to claim that patients have access to virtually any physician participating in the Medicare program has made PFFS plans an unwarranted profit-center for the insurance industry at the expense of patients and physicians; therefore be it
RESOLVED, That our American Medical Association take appropriate action to support the elimination of the Private Fee For Service Plans (PFFS) in the Medicare Advantage Program. (Directive to Take Action)
Received: 05/09/07
Fiscal Note: Implement accordingly at estimated staff cost of $4,580.
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