Challenges facing independent integrated gastroenterology in 2017

The FSA’s qui tam action in Florida is part of a broader agenda by those who seek to undermine the integrated care model that enables gastroenterologists and other physician specialists to integrate anesthesia services into lawful care models. A website describing the Florida qui tam action hailed the American Society of Anesthesiology for having “repeatedly petitioned the Office of the Inspector General, brought the issue up with Congressional leaders and executive branch regulators, and provided information and legal resources to its members.”³ These efforts to undermine integrated, coordinated care at the federal level also have extended to the state level, in which efforts have been made in front of licensing boards and state legislatures – albeit unsuccessfully – to restrict the integration of anesthesia services.
 

In-Office Ancillary Services Exception

The In-Office Ancillary Services Exception (IOASE) to the federal physician self-referral statute (the Stark Law), allows physician practices to provide certain services, including diagnostic imaging and anatomic pathology, in an integrated and coordinated fashion within their respective practices when strict criteria are met.

Not surprisingly, competing providers of these services have long fought for the elimination of the IOASE. In 2013, Representative Jackie Speier (D-CA) introduced the Promoting Integrity in Medicare Act. This bill sought to eliminate those legal protections for providing those integrated medical services under the IOASE. Vigorous support for the legislation was provided by a group called the Alliance for Integrity in Medicine, a coalition of organizations including the College of American Pathologists, the American Society for Clinical Pathology, the American Clinical Laboratory Association, and the American College of Radiology. Although that bill did not even receive a vote during the last Congress, Representative Speier has re-introduced it in this current session, and continues to lobby aggressively in support of this legislation. President Obama’s budget for 2016, as the President’s budget proposal had done for the past several years, also included elimination of the IOASE provision. Extensive advocacy efforts by a broad range of specialty organizations have been instrumental to date in defeating this proposal. A study commissioned by the Digestive Health Physicians Association,⁴ using Medicare data, showed that GI-related anatomic pathology services actually increased more slowly in professional settings (physician offices and laboratories), at an annual rate of 1.2% from 2009 to 2013, compared with the outpatient hospital setting of 3.5% during that same period. Efforts to restrict practice integration similarly are being made at the state level. In California, legislation to eliminate the IOASE under the State’s self-referral law was introduced in 2014. Coordinated efforts by California patient- and physician-interest groups were successful in educating legislators on the value of the integrated care mode and the bill was soundly defeated.
 

Medicare Part B Drug Benefit

In March 2016, a new threat to integrated care in GI surfaced when the CMS released a proposed rule that would test a new Medicare Part B payment model for infused drugs including infliximab and vedolizumab. Under the proposal, the CMS would reduce the current reimbursement of 6% above average sales price (ASP) to ASP plus 2.5%, plus a flat fee of $16.85 per infusion. CMS calculations in this proposal failed to include the mandatory 2% sequestration of Medicare payments under the Budget Control Act, which means that the actual reimbursement will be less than 1% over ASP. Because many practices are unable to negotiate discounts for these drugs, unintended consequences of this proposal may disrupt care coordination efforts, resulting in movement of infusions performed in the office setting into the more costly hospital setting. Perversely, although the stated intent of this proposal was to reduce incentives for prescribing more expensive drugs, infused biologic agents are actually treatments of last choice for many inflammatory bowel disease patients.

In the absence of less-expensive alternatives, this proposed change in reimbursement likely will reduce access to effective therapy for some of our sickest patients and will not reduce costs. It is hoped that the vigorous advocacy by a coalition of more than 300 medical societies and patient-interest groups along with a majority of members of Congress may result in modifications to this proposal when the final rule is released later this year.
 

Stark Law

The Stark Law, commonly known as the Physician Self-Referral Law, originally was passed by Congress in 1989 and was substantially amended last in 1993. The Stark Law was enacted to address concerns of potential overuse or inappropriate use of services in a fee-for-service payment system. Health care delivery has changed dramatically since the Stark law was passed 27 years ago, but this statute has not kept pace and is incompatible with new and innovative delivery models that now mandate a shift from fee-for-service payment models to value-based care and the development of risk-sharing arrangements and bundling of services. In 2011, the CMS created a set of waivers for Accountable Care Organizations in the Medicare Shared Savings Program, but these waivers do not apply to many of the alternative payment models under development by independent physicians.