Health Affairs, 22, no. 3 (2003): 238-240 doi: 10.1377/hlthaff.22.3.238 © 2003 by Project HOPE	New Online   Pay Cuts For Medicare Docs   Access To Care Woes   Public Coverage More Efficient   Empowering Consumers

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Publications & Reports

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The report can be read at yosemite.epa.gov/ochp/ochpweb.nsf/content/ACEreport3_19final.htm/$File/ACEreport2_21final.pdf.

Medicare

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Improper Fiscal Year 2002 Medicare Fee-for-Service Payments, a 16 January 2003 report from the inspector general’s (IG’s) office, U.S. Department of Health and Human Services (HHS), estimates that $13.3 billion, or 6.3 percent, of Medicare fee-for-service payments were improper in federal fiscal year 2002, which ended 30 September 2002. The report notes that the improper payment rate has fallen from $23.2 billion—13.8 percent—in 1996, when the IG’s office first began tracking improper payments, but adds that "we cannot conclude that it is statistically different from the FYs 1998–2000 estimates, which ranged from 6.8 to 8 percent." The IG’s office based its conclusions on a sample of 4,985 claims valued at $6.2 million, of which 1,030 did not comply with Medicare laws and regulations. According to the report, medically unnecessary services accounted for the biggest share of the improper payments at 57.1 percent, a "significant" increase over the 43.2 percent that such services represented in 2001. The report says that the Centers for Medicare and Medicaid Services (CMS), in particular, needs "to increase its work with providers to ensure that medical records support billed services."

Free single copies of this report are available on the Web at oig.hhs.gov/oas/reports/cms/170202202.pdf.

Report to the Congress: Medicare Payment Policy, a 27 February 2003 report from the Medicare Payment Advisory Commission (MedPAC), assesses the adequacy of Medicare reimbursement to six categories of providers and makes recommendations on compensation policy for 2004. The report finds that long-term Medicare spending trends are largely in line with those of private insurance and other large government purchasers. Like private insurance, Medicare spending growth has returned to a rate of 7.7 percent in 2001–02, closer to the historical average than the anomalously slow annual growth rate of 1.7 percent in 1998–2000. The report also notes that Medicare spending will grow as a percentage of both the federal budget and the nation’s gross domestic product (GDP). New technology and the retirement of the baby-boom generation are among the factors expected to drive that growth. The report documents numerous recommendations to improve Medicare payments or account for changes in the health care economy, including a bonus to isolated low-volume hospitals because they have higher costs per discharge; a reevaluation of how Medicare compensates hospitals for their labor costs; an increase in physician payments to match cost increases; and a new payment system for skilled nursing facilities.

The report can be read at www.medpac.gov/publications/congressional_reports/Mar03_Table_of_Contents.pdf.

2003 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds, issued 17 March 2003 by the U.S. Treasury Department and HHS, details the financial outlooks of Medicare Parts A and B. The new report forecasts that the Part A trust fund will be exhausted in 2026, four years earlier than the trustees predicted last year, as a result of lower-than-expected revenue growth and higher-than-expected growth in spending for inpatient hospital services. In the short term, tax revenues will exceed expenditures through 2012, but the trust fund’s financial health will begin deteriorating after that. The trustees forecast that combined Medicare Part A and Part B spending will represent 5.3 percent of U.S. GDP by 2035 and 9.3 percent by 2077, from 2.6 percent in 2002. Medicare spending’s share of GDP will be three times the level of scheduled tax revenues, "a very substantial deficit by any standard," the report says. "Growth of this magnitude, if realized, would place a...greater strain on the nation’s workers, Medicare beneficiaries, and the federal government," the trustees conclude.

The report can be read at www.cms.hhs.gov/publications/trusteesreport/2003/tr.pdf.

Public Health

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Microbial Threats to Health: Emergence, Detection, and Response, a March 2003 Institute of Medicine (IOM) report, recommends that the United States "seek to enhance the global capacity for response to infectious disease threats," with a particular focus on developing countries. Such efforts need to be coordinated with international agencies such as the World Health Organization and U.S. agencies such as the Centers for Disease Control and Prevention (CDC) and the National Institutes of Health. To accomplish this, the report recommends that the CDC enhance its regional infectious disease surveillance; that the U.S. Defense Department expand its activities through its Global Emerging Infectious Surveillance program sites; and that technology for identifying new infectious diseases be transferred to other countries, where feasible. The report also recommends that the United States commit money to rebuilding its own public health system. The IOM identifies thirteen factors that could add to the ability of microbes to develop into global health threats. Among them are microbial adaptation and change; human vulnerability; climate and weather; changing ecosystems; economic development and land use; and international travel and commerce.

The report can be read at www.nap.edu/books/030908864X/html.

The Uninsured

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Covering the Uninsured: How States Can Expand and Improve Health Coverage, a 14 March 2003 report from the Heritage Foundation, makes recommendations to state policy-makers on how to expand health insurance coverage. Heritage says that the states are constrained by federal law on such issues as tax treatment of employer-sponsored health insurance coverage. But the report says that states can make changes in their own laws to accommodate President George W. Bush’s proposal to offer tax credits to uninsured people who buy health insurance. The report also recommends that recently displaced employees now eligible for federal health insurance assistance be allowed to enroll in private plans offered to state employees; that states seek waivers for their Medicaid programs to make federal funds available to low-income uninsured people wishing to buy into private health care options; create preventive care accounts for Medicaid beneficiaries; and create statewide voluntary health care purchasing cooperatives.

The report can be read at www.heritage.org/Research/HealthCare/bg1637.cfm.

Going without Health Insurance, a 5 March 2003 report by Families USA and released by the Robert Wood Johnson Foundation (RWJF), finds that 30.1 percent of non-elderly Americans were uninsured for at least part of the 2001–2002 time period. The report relies on the Census Bureau’s Current Population Survey (CPS), which assesses how many people lacked health insurance throughout the previous year, and Census’ Survey of Income and Program Participation (SIPP) to come up with its number. Of the 74.7 million people who were uninsured for at least part of that two-year period, 42.7 percent were uninsured for at least a year and 65 percent were uninsured for at least six months. Of those without insurance, 70.7 percent were employed and 7.2 percent were actively looking for employment.

The report can be read at www.familiesusa.org/Going%20without%20report.pdf.

Paying for Health Care When You’re Uninsured: How Much Support Does the Safety Net Offer?, a January 2003 publication of the Access Project (affiliated with Brandeis University), reports on a survey of uninsured people conducted May–August 2000. Three of five respondents reported needing help paying their hospital bills, a problem that was most pronounced among those who used hospital emergency and outpatient departments. The survey also found that 56 percent of respondents needed help paying for prescription medications, and 13 percent said that they obtained only some or none of their medications because of cost. Only 30 percent said that hospital staff always offered to look into financial assistance with bills, but most often, the offer consisted of allowing patients to pay their bills in installments. Forty-six percent of respondents said that they were in debt to facilities for care. The report’s authors say that the survey rebuts the belief that the uninsured always receive free health care when they need it.

The report can be read at www.accessproject.org/medicaldebt.html.

A Shared Destiny: Community Effects of Uninsurance, a 6 March 2003 report from the IOM, finds that insured people are affected when there are many uninsured people in their community because it puts financial strain on health care providers, hurting access to health services and their benefits to the insured. The committee writing the report found that low-to moderate-income people have worse access to care in communities with high numbers of uninsured citizens than in communities with low numbers, although the committee does not identify a cause. The report goes on to say, however, that high rates of uninsurance reduce access to clinic-based primary care, specialty care, and hospital care, particularly in emergency departments. For example, the report says that for eighty-five urban areas studied, a higher prevalence of uninsured people results in fewer hospital beds per capita, lower levels of services, and a lower financial margin for hospitals. The report concludes that "it is both mistaken and dangerous to assume that the prevalence of uninsurance in the United States harms only those who are uninsured."

The report can be read at books.nap.edu/books/0309087260/html/index.html, or purchased online at www.nap.edu/catalog/10602.html.

Veterans’ Health Care

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VA Health Care: Third Party Collections Rising as VA Continues to Address Problems in Its Collections Operations, a January 2003 report from the U.S. General Accounting Office (GAO), updates efforts by the Department of Veterans Affairs (VA) to collect health insurance payments for treating veterans with coverage for conditions not related to their military service. The report found that third-party collections increased 32 percent in federal FY 2002. The report documents improvements in the VA’s billing, including reduction of a backlog in billing, as well as better documentation and bill preparation by physicians and more bills prepared per biller. The GAO said, however, that the VA still needs to work on billing operations, such as documentation, identification of insurance, and more billing staff.

The full report can be read at www.gao.gov.

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