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Monday, May 20, 2002 - Page updated at 12:00 AM

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Higher Medicare returns sought

Seattle Times Washington bureau

WASHINGTON — Dr. David Lynch didn't want to stop accepting new Medicare patients in Whatcom County's Family Care Network.

But he and other doctors weighed the situation in 2000 and decided it was the only way to keep the doors open for their 80,000 patients. In some cases, Lynch said the health-care centers were spending $4 per Medicare patient before the physicians even got one penny.

"We knew that if this condition persisted throughout our entire network of 11 offices, we'd be out of business," Lynch said. "We all went to medical school because we want to see patients and deliver medical care. This was the hardest decision we've had to make."

Sen. Patty Murray, D-Wash., is planning this week to introduce the MediFair Act, a bill that would boost reimbursement rates for states that get less than the national average per patient from Medicare's payment system.

Such legislative efforts have been tried before. But Murray and other members of the state's congressional delegation say the situation has reached a boiling point. The federal insurance program, which covers patients 65 and older and some disabled Americans, isn't paying what it used to, particularly to family doctors and general practitioners. Because payments are tied to the gross domestic product, the sagging economy triggered a 5.4 percent cut in payments to doctors this year. Reimbursements are expected to decrease a total of 17 percent by 2005.

While doctor participation in Medicare historically has been high, a survey by the American Academy of Family Physicians said 17 percent of family doctors refused to take new Medicare patients in 2000.

The problem is acute in Washington and other states that receive less than the national average of federal spending per patient. Doctors in those states say complicated federal reimbursement rates penalize them for providing care more efficiently. And they complain they are buried in paperwork — for Medicare and other public and private insurance programs.

A recent American Medical Association survey found one-third of doctors spend one hour on Medicare paperwork for every four hours of patient care.

It's "charity care for Medicare," said Dr. Paul Buehrens, medical director of the Lakeshore Clinic in Kirkland, whose group doesn't take new Medicare patients. "Let's put it this way: The complexity of getting paid makes the complexity of medicine pale in comparison."

Some 40 million people participate in Medicare. In less than three decades, that number is expected to double. But, Murray said, places such as Port Angeles and Port Townsend are already starting to feel the effects of less money for Medicare because they have higher numbers of seniors.

"We need to figure out how to deal with it in those communities now," she said. "The intensity of the discussion has tripled."

Murray wants less disparity between states in the amount of money available to Medicare recipients. According to statistics compiled by the Henry J. Kaiser Family Foundation, beneficiaries in Washington, D.C., received an average of $10,373 in 2000, compared with $3,921 in Washington state and $3,053 in Iowa.

Murray's legislation, now in draft form, would require that every state receive at least the national average of per-patient spending — $5,490 in 2000. States that get more than 105 percent of the national average could see a cut.

But states with "healthy outcomes" — high life expectancy, low rates of diabetes or heart disease or other criteria identified by U.S. Health and Human Services — could avoid cuts.

Other efforts to change reimbursement rates have hit roadblocks because of political clout among states that get the most money, including California, Florida, New York and Texas.

But Murray said the situation is critical.

"It is one of those concepts that is going to take time to educate other members," she said. As the House takes up health-care legislation next month, "I don't expect a miracle in June."

Some say the bill could mean higher federal health-care expenditures at a time when the government is trying to make cuts. But Murray says it will force states to be more efficient and reduce costs overall.

Robert Moffit, director of domestic-policy studies at the conservative Heritage Foundation think tank, said Murray's efforts are admirable but politically difficult. And they don't get to the root of the problem.

Moffit said the problem will be solved only by overhauling the Medicare system to reduce over-regulation and underpayment to doctors. He wants to see a consumer-driven system based on a competitive market, not the current federal pricing system.

As evidence of the need for reform, he points to factors used to determine the Medicare reimbursement rate, including the doctors' time and energy as well as malpractice costs and other expenses.

For instance, doctors at hospitals get paid more than their peers offering the same services in private practices, he said. The formula creates the wide disparities between funds provided to states.

The bottom line, Moffit said, is that seniors will face shortages in available medical care. "We have water in the mailroom of the Titanic now," he said. "That is what is going on here."

Katherine Pfleger: 202-662-7455 or kpfleger@seattletimes.com.

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