Elections Bring Change—PPS Advocacy Adjusts
By Jerome Connolly, PT, CAE
January 1, 2015
It was a monumental and historical election in November, and not because the District of Columbia legalized possession of marijuana. (It is probably too much to hope that the passage of the “DC doobie referendum” might bring more comity to a politically dysfunctional city). When the 114th Congress convenes, Republicans will have the largest majority in the House in nearly 80 years and will rule the Senate by a margin of 54 to 46.
More definition of the 114th Congress will come when committee appointments, chairmanships, and leadership posts are finalized but meantime, we can make some reasonable assessments of the takeover effects and begin to map our path forward.
There can be no doubt that this convincing Republican victory will usher in a significant change to the congressional and political climate. But the precise implications for the Affordable Care Act (ACA) and for the PPS legislative priorities depend on many factors and developments that have yet to emerge.
In analyzing the election results through the prism of the PPS advocacy agenda, we must answer a number of questions: Will we be better off with both the Senate and House controlled by Republicans? Will Obamacare be repealed? Replaced? Will PPS need to adjust its legislative priorities?
Effect on Obamacare
Since the Republicans have controlled the House of Representatives since 2010, we know what to expect from that chamber with respect to the ACA. That would be repeal, repeal, and more repeal. The chamber has voted 54 times to repeal, dismantle, or defund Obamacare.1 Of course, with a Democrat majority in the Senate (not to mention a Democrat in the White House), such bills have gone nowhere. But now that the Senate will also be in Republican hands, what will happen to such bills if those repeal attempts continue?
Shortly after his own reelection, the incoming Senate Majority Leader Mitch McConnell cautioned his colleagues that full repeal of Obamacare may not be possible and that an incremental approach may be more appropriate.2,3,4 “It would be better to go after unpopular parts of the law rather than a full repeal,” he said. This angered members of the GOP caucus who favor full repeal and recalled candidate McConnell stating that he wanted to “rip out Obamacare root and branch.”5
Now that McConnell is in charge, he must decide how he will manage the upper chamber. Will he choose to confront the president or cooperate with him? Will he choose to investigate or legislate? If it is the latter, then what kind of legislation will he allow to go forward?
Both McConnell and the president have reason to strive for legislative accomplishments; Obama has his legacy in mind and the Republicans in Congress want to show the American public that they can govern; that they deserve to control the administrative branch (White House) in addition to the legislative branch. But some within the Republican caucus believe this is the time to truly differentiate the “Rs” from the “Ds” by opposing Mr. Obama at every turn and even shutting down the government again if that’s what it takes. In the words of Sen. Ted Cruz (R-TX), “I don’t think what Washington needs is more compromise.”6,7 So the actual path forward for the Republican-controlled Congress is yet to be decided. And even when it is, it may not be a clear consistent path on every issue.
With respect to Obamacare, what McConnell was saying to his fellow Republicans is, it is important to remember that even though the GOP controls the Senate by a margin of 54-46, 54 votes is not 60—the number needed to break a filibuster. Moreover, 54 is not 67 which is the two-thirds majority required to override a presidential veto.
So while both chambers may entertain votes to overturn the ACA, these will be largely theatrical and intended to make good on campaign promises. A targeted incremental approach to undoing parts of Obamacare is more likely. Provisions Republicans have in sight include changing the definition of a full-time employee from 30 to 40 hours per week, giving insurance policy holders more options to keep the plans they have, repealing the ACA-created Independent Payment Advisory Board (IPAB) tasked with Medicare cost cutting, and repealing the law’s controversial medical device tax.8
There could even be an effort to overturn the individual and employer mandates. But these requirements have an unlikely and influential ally in the private insurance sector. UnitedHealth, WellPoint, Aetna, and Cigna are among payers who are happily reporting record third quarter profits.9,10,11,12 Even hospital operator HCA raised its 2014 outlook as Q3 results topped analysts’ estimates.13
Some attempts to amend the ACA may meet with success as President Obama has expressed a willingness to work with the new Congress on tweaking Obamacare. However, he has warned the new majority that any bill he believes will structurally undermine the law will be met with his veto pen, a tool that has been rarely used by this president.
Effect on PPS Priorities
To determine the potential effect of the new congressional composition on PPS issues requires a similar analysis. With certain notable exceptions, PPS advocacy priorities are not generally seen as partisan issues. Table 1 depicts the top PPS Medicare priorities for the past Congress and reveals a mixed bag with respect to how these issues might fare in the next.
Repealing and replacing the sustainable growth rate (SGR) and therapy caps has been repeatedly supported by both Republicans and Democrats. However, the parties disagree on how such legislation should be paid for.
Our locum tenens initiative (HR 3426 and S. 2818 in the 113th Congress) has the support of both sides of the aisle as well. And since it is a no-cost technical correction, the parties do not have to identify “pay-fors” which allows them to agree on the policy.
But adding PTs to the provision allowing providers to opt out of Medicare is one of the issues on which Ds and Rs disagree. Republicans generally believe that more private sector options should be available through the Medicare program (think Medicare Advantage) while Democrats deem any such measure to weaken the health insurance program for our nation’s seniors. So Republicans favor the opt-out provision and, in fact, would even like to expand it while the Democrats oppose even minimalist approaches such as adding PTs to the list of 13 other professionals that have been granted this privilege for several years.14
And then there is physician self-referral, an issue that splits legislators right down party lines. Democrats favor closing the loophole known as the in-office ancillary services exception. But Republicans, especially the nearly 20 physician legislators in the House and Senate, believe in the preservation, if not the expansion of physician self-referral. So while we have likely lost the prospect of gaining any notable traction on closing the self-referral loophole (despite its money-saving propensity), the issue rises to the top of our “watch list” as we must be prepared to oppose any attempts to expand the self-referral permission under Medicare.
Report Card on the 113th Congress
Thanks to PPS member assistance and your willingness to contact your legislators when asked, PPS can report reasonable results in the 113th Congress. Admittedly, we cannot claim victory, but we did mark some progress that is worth mentioning and for which PPS members should take credit.
Sustainable Growth Rate
On the SGR, we contributed to the successful coalition efforts that enabled us to avoid a serious (21 percent) reimbursement cut. Instead, a 0.5 percent increase was achieved and the new payment rate was extended to March 31, 2015. Notable progress was also made on a bill that creates the architecture for the mechanism that would replace the SGR, allowing the dysfunctional formula to be repealed.
We are also getting closer to the repeal and replacement of the arbitrary and discriminatory Medicare therapy caps that have been harming us and our patients since the 1997 Balanced Budget Act. Our efforts have contributed to an extension of the therapy cap exceptions process through the end of the first quarter of 2015. And progress is being made on a replacement for the caps primarily because of the impressive leadership of the APTA in diligently working toward an alternative payment method. Manual medical review and functional limitation reporting have been initiated as data collection programs that can be used to describe patient characteristics and determine Medicare patients’ response to, and outcomes from, physical therapy intervention.
A most significant PPS legislative achievement was getting bills introduced that would add physical therapists to the Medicare statutory provision which allows physicians and other health professionals to retain qualified licensed professionals in their practices when the owner needs to be absent for a short time due to illness, pregnancy, professional development, jury duty, etc. Using the “locum tenens” clause enables the Medicare patient to receive care and the practice to bill for the services of the substitute.
HR 3426 was introduced in House in July 2013, followed by the introduction of S.2818 in Senate in September 2014. In an effort to convince legislators to include this provision in the next large Medicare legislative package, we will attempt to add to our list of cosponsors (13 Representatives and 3 Senators in the 113th Congress) with the full understanding that this bill – as is the case with all bills—will have to start anew in the 114th Congress.
Even though the congressional climate (particularly in the Senate) was not conducive to expanding the Medicare “opt-out” provision, we did find a champion in the person of Rep. Tom Price who included physical therapists in the Medicare Patient Empowerment Act (H.R. 1700). This accomplishment is an important step in identifying the PT profession with the issue when opt-out or even private contracting legislation is revisited in the next Congress.
The physician self-referral issue was the focus of some activity in both the legislative and executive branches of government. PPS supported Rep. Jackie Speier (D-CA) in her introduction of the Promoting Integrity in Medicare Act of 2013 (HR 2914) which would close the in-office ancillary services exception loophole. However, our attempts to find a Republican cosponsor were in vain and the bill languished in the House.
In June, the Government Accountability Office (GAO) issued its long-awaited report on Self-Referring Providers of Physical Therapy in Medicare.15 The report was a “mixed bag” for physical therapy, revealing that while self-referring physicians referred more patients to their own PT service, the treatment episodes were shorter and less costly than care received by patients in non-self-referred situations. The study also determined that patients who were self-referred by family practice providers and internal medicine providers received more passive treatment (modalities such as ultrasound, electrical stimulation, and massage) and less hands-on care (such as evaluation, therapeutic exercise, and gait training), the latter of which (as we well know) is more indicative of appropriateness of PT for restoring functional ability.
One of the more profound findings was that once physicians become financially involved with physical therapy services (the so-called “switchers”) their referral frequency dramatically increases. This demonstrates the perverse incentive of physician ownership of PT practices.
But at the same time the study found that while non-self-referred services were increasing about 40 percent, self-referred PT services were generally flat.
Lastly, the GAO, along with the Centers for Medicare and Medicaid Services and the Medicare Payment Advisory Commission before them, concluded that better data is necessary to identify physicians in self-referral situations (create your own acronym here).
So, while this report was not the convincing and incontrovertible evidence for which we had hoped, it still provides considerable basis for legislative and/or regulatory strategies. PPS will analyze the opportunities these data may offer and adopt the appropriate advocacy goals, such as urging Congress to:
- require self-referring providers to notify patients of their right to obtain physical therapist services from any provider they choose;
- require self-referring providers to give patients a list of local, alternative physical therapy providers;
- require Medicare claim forms to include a unique modifier that indicates if services were received via a self-referral arrangement;
- undertake further study of the impact of self-referral arrangements.
But given that the opponents of such policy have significantly increased their ranks and their strength in Congress, we must recognize the formidable challenge this represents.
PPS Key Contact Program Integral
The above progress could not have been possible without the willingness of PPS members to engage in our advocacy program. PPS membership is to be congratulated for its embrace of the PPS Key Contact Program, which was established in 2014. In the course of eleven months, the Section identified and enrolled 124 PPS Key Contacts for target legislators. This member engagement contributed significantly to the success of our lobbying efforts. PPS has gained recognition and identity on Capitol Hill.
Going forward, our plans are to make the necessary adjustments to the Key Contact program that will be required by the outcome of the mid-term elections but also to continue to expand this part of our advocacy program until we reach our ultimate goal of one PPS member assigned to every member of Congress.
The PPS Board of Directors and the Government Affairs Committee will review the political environment, the congressional climate, and identify the Section’s advocacy priorities for the 114th Congress that begins in January 2015 and ends in December 2016. I encourage you to contact Board and GAC members with input. I will bring you reports on our lobbying efforts and, yes, calls for action, periodically throughout the year.
Hopefully, with or without the help of legalized pot in DC, Congress will mark some achievements worth reporting.
1. O’Keefe E, The House has voted 54 times in four years on Obamacare. Here’s the full list, Washington Post, March 21, 2014.
2. Walsh K, Obama’s Unpopularity Affected Democrats in Midterm Elections, U.S. News & World Report, Nov. 5, 2014.
3. Hurtubise S, McConnell May Be Backing Off Obamacare Repeal, The Daily Caller, Nov. 5, 2014.
4. Time, “McConnell: No Shutdowns, No Full Obamacare Repeal,” Nov. 5, 2014
5. Politico, Oct. 29, 2014.
6. Fox News Latino, Jan. 7, 2013, http://latino.foxnews.com/latino/politics/2013/01/07/ted-cruz-takes-stand-against-gun-control-and-hagel-in-no-compromise-strategy/
7. Gerson M, A compromised reputation among the GOP, Washington Post, Sept. 26, 2013.
8. Sealander K, Stocker E, What the Election Means for Health Care, The New Balance of Power: What the 114th Congress Means for Business, McDermott Will & Emery, Nov. 12, 2014.
9. UnitedHealth’s Profit Boosted by Lower Medical Costs, Wall Street Journal, Oct. 16, 2014.
10. WellPoint Inc. posted higher-than-expected quarterly earnings, Wall Street Journal, Oct. 28, 2014.
11. Aetna Tops Street in 3Q, Raises 2014 Forecast, Associated Press, Oct. 28, 2014.
12. Cigna Raises Outlook as Results Exceed Expectations, Wall Street Journal, Oct. 30, 2014.
13. HCA raises its 2014 outlook as Q3 results topped analysts’ estimates, Wall Street Journal, Oct. 15, 2014.
14. Social Security Act, Section 1802(b)(5)(B) (42 U.S.C. 1395a(b)(5)(C)).
15. Government Accountability Office, Medicare Physical Therapy: Self-Referring Providers, June 2, 2014, GAO-14-270.
Jerome Connolly, PT, CAE, is a registered federal lobbyist whose firm, Connolly Strategies & Initiatives, has been retained by PPS. A physical therapist by training, he is a former private practitioner who throughout his career has served in leadership roles of PPS and APTA. Connolly also served as APTA’s Senior Vice President for Health Policy from 1995–2001.