March 7, 2008

1. MedPAC Discusses Physician-Pharma Relationships, Primary Care

2. House and Senate VA Committees Propose FY 2009 Increase in VA Research Funding

1. MedPAC Discusses Physician-Pharma Relationships, Primary Care

During its public meeting March 5-6, 2008, the Medicare Payment Advisory Commission (MedPAC), a congressionally chartered commission established to advise Congress on issues affecting the Medicare program, discussed how to make publicly reporting physicians’ financial relationships with drug and device manufacturers a reality and presented recommendations for promoting primary care.

At the meeting, members of MedPAC nearly unanimously agreed that public reporting of physician-pharmaceutical industry financial relationships should be mandatory. The commission pointed to the ties between academic institutions and pharmaceutical industries as the starting point of physicians’ negative acculturation regarding financial relationships with pharmaceutical and device manufacturers. In addition, the commission discussed the pharmaceutical industry’s influence on medical students and residencies through directly providing money to education programs as well as influencing hospital formularies and therefore the drugs students and residents learn about. Several commission members stated that universities and teaching hospitals should develop strict universal guidelines regarding relationships with the pharmaceutical industry. While some states have current laws in place to provide guidelines, the commission agreed that state efforts have proven insufficient. Commission members discussed the possibility of introducing federal legislation or regulation to mandate reporting financial relationships between physicians and the pharmaceutical industry. MedPAC members will use the discussion from the meeting to create draft recommendations to be refined and presented to the Secretary of Health and Human Services (HHS) in the fall of 2008.

Regarding promoting the use of primary care, commission members focused the discussion on fee schedule changes and medical home programs. MedPAC staff cited a history of strong interest in primary care and the commission’s intention to address access concerns caused by the lack of US medical graduates entering careers in primary care specialties which could be a result of the current payment model. Members of the commission drafted the following recommendations for further discussion:

• Congress should provide budget neutral payment adjustments for primary care services billed under the physician fee schedule. Payment would increase for a service if a practitioner identified by the HHS Secretary furnished the service.
• Congress should implement an increase in the fee schedule adjustment for primary care
• Congress should consider different fee schedule adjustments for specific physician specialties
• Medicare should implement a medical home pilot program that requires a physician pay-for-performance program. The medical home must:
• Furnish primary care.
• Use health information technology.
• Conduct case management.
• Maintain 24-hour patient communication and access.
• Keep up-to-date records or patients advance directives.
• Be accredited by an external accrediting body.

For more information on MedPAC, please visit www.medpac.gov.

2. House and Senate VA Committees Propose FY 2009 Increase in VA Research Funding

The Democrats on the House and Senate Committees on Veterans Affairs (VA) released funding recommendations of $555 million for the VA Medical and Prosthetics Research Program in their “views and estimates” on the fiscal year (FY) 2009 budget. This proposal matches the recommendation provided by the Friends of VA Medical Care and Health Research (FOVA) coalition. The Alliance for Academic Internal Medicine is a member of the coalition’s executive committee.

The $555 million recommendation is a significant increase over the administration’s FY 2009 budget, which proposes $442 million for VA research, a $38 million cut from FY 2008. The Senate VA Committee notes in its views and estimates that increased funding over FY 2008 levels is “required to sustain current VA research and development program commitments and to cover inflationary cost increases.” The House VA Committee articulates a similar opinion in its own views and estimates. In a letter to the House Committee on the Budget, the committee describes the administration’s proposed cuts as “especially troubling.” The proposed cuts include decreases in funding for mental health and traumatic injury research—particularly salient issues for Operation Enduring Freedom and Operation Iraqi Freedom veterans. House Republicans recommended FY 2009 funding of $525 million for the VA research program—bipartisan support that indicates a strong likelihood of success for a higher FY 2009 appropriation.

The House VA Committee views and estimates also match FOVA’s recommendation to appropriate $45 million in the minor construction budget to upgrade and modernize VA research facilities. The committee specifically identified FOVA and its FY 2008 recommendation of $45 million to improve research infrastructure.

To rally support for the program, on Tuesday, March 4, 2008, FOVA held a membership briefing outlining the VA Medical and Prosthetics Research Program and the funding outlook for FY 2009. VA Chief Research and Development Officer Joel Kupersmith, MD, and VA Director of Rehabilitation Research and Development Michael Selzer, MD, PhD, provided an overview of the current state of VA research and lauded recent advancements in genomic and rehabilitative medicine that have emerged from the program. Praises of the history of VA research were also accompanied by FOVA’s request for consideration of the long-term budgetary needs of the VA health care system, particularly VA’s ability to recruit and retain high quality clinician scientists. Cathy Wiblemo, majority staff director for the House Committee on Veterans Affairs Subcommittee on Health, addressed the committee’s commitment to adequately funding VA and applauded the informative resource FOVA provides to members of the committee.

The Alliance for Academic Internal Medicine—the nation’s largest academically focused specialty organization—consists of the Association of Professors of Medicine, the Association of Program Directors in Internal Medicine, the Association of Subspecialty Professors, the Clerkship Directors in Internal Medicine, and the Administrators of Internal Medicine.

Please contact AAIM Vice President for Policy Charles P. Clayton (cclayton@im.org), AAIM Policy Coordinator Nicole V. Baptista (nbaptista@im.org), or AAIM Policy Assistant Jessica L. O'Hara (johara@im.org) at (202) 861-9351 with questions or comments about this week’s Merlin.