New Medicare Law Discriminates Against Certain Providers
By Naomi Lopez and Sue Blevins
April 9, 1998
In his recent state of the union address, President
Clinton stressed that Americans should have a choice of
doctors. Isn't it ironic? His recently passed Balanced
Budget Act grants only certain types of doctors the right
to privately contract with seniors. If President Clinton
is serious about improving patient choice, then the first
step he should take is to make sure seniors are free to
choose and pay privately for all types of providers. As
it stands now, seniors do not have that freedom.
You may be familiar with Section 4507 of the Balanced
Budget Act that took effect on January 1. This provision
says that any doctor who accepts private payment from
a senior (for a Medicare-covered service) must stop seeing
all Medicare patients for two years.
Some members of Congress (from both major political
parties) claim that this provision gives seniors greater
choices than they had under the old Medicare law. That
is because under the old law, the Health Care Financing
Administration (HCFA) harassed doctors who attempted to
privately contract with seniors, even though a federal
judge found nothing in the law that prohibited private
contracting.
The new law can relieve doctors from HCFA harassment,
but only if they stop seeing all of their Medicare patients
for two years. This provision hardly gives seniors more
choices of doctors.
Doctors Denied Right to Contract
There is an even greater problem with Section 4507 that
no one is talking about. This new Medicare law grants
the limited right to privately contract to only two types
of [medical] providers: doctors of medicine and doctors
of osteopathy. Other types of doctors were denied the
legal right to contract with seniors. Those providers
include dentists, oral surgeons, optometrists, chiropractors,
and podiatrists.
Why should Americans be concerned about this new limit
on their choices? Because every year, nearly one-third
of seniors seek medical treatment from oral surgeons,
chiropractors, optometrists, and podiatrists. (Data on
dentists were not readily available). According to the
most recent HCFA data, in 1995:
* Oral surgeons served 103,700 seniors
* Chiropractors served 1.4 million seniors
* Optometrists served 3.8 million seniors
* Podiatrists served 5 million seniors
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All told, these doctors performed over 48 million services
for Medicare patients in 1995. That is why if Congress
does not fix Section 4507, millions of seniors will be
prevented from choosing and paying privately for doctors
they frequently use.
Senator Jon Kyl (R-AZ) and Representative Bill Archer
(R-TX) have introduced legislation that would fix the
problem created by Section 4507. "The Medicare Beneficiary
Freedom to Contract Act" (S.1194/H.R.2497) lifts the two-year
Medicare ban on doctors who choose to sign private contracts
with seniors.
Additionally, their legislation expands the definition
of physician to include all types of doctors, including
dentists, oral surgeons, optometrists, chiropractors and
podiatrists. Most importantly, their legislation clarifies
that seniors have a legal right to choose and pay privately
for the doctors of their choice.
Opponents of private contracting claim that such policy
would increase Medicare fraud and abuse. There is no doubt
about it, the current Medicare system is fraught with
enormous fraud and abuse. Federal auditors found that
in 1996 alone, Medicare fraud amounted to $23 billion.
That amounts to $63 million every day! However, allowing
seniors to contract privately for health care could actually
reduce Medicare fraud. That is because the private health
insurance industry could never tolerate fraud amounting
to $63 million per day.
There is another important reason why seniors would
choose to pay privately for services that Medicare might
cover. Currently, Medicare does not make clear exactly
what they cover and what they do not cover under all circumstances.
Thus, many patients and doctors have to second guess how
HCFA would rule on a medical coverage decision. In the
end, many patients are forced through the bureaucratic
Medicare appeals process to challenge denied claims. In
some cases, patients have to hire expensive lawyers to
determine what medical care is reimbursable under their
particular circumstances. Yet, if seniors were allowed
to privately contract, they could determine ahead of time
what medical care is to be covered under all circumstances.
Lawmakers who want to force seniors into Medicare and
deny them of their medical liberty should come forward
and say so honestly. However, those lawmakers who believe
in the principles of liberty and economic freedom should
practice what they preach: Restore the liberty that was
stripped from seniors and their doctors under Section
4507 of the recently-enacted Balanced Budget Act.
Naomi Lopez is research associate at the Institute
for SocioEconomic Studies in White Plains, NY and Sue
Blevins is president of the Institute for Health Freedom
in Washington, DC.
This article was originally published in the March/April 1998 issue
of Health Freedom
Watch.
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