Health-Reform Bill Holds Changes for Medical Training

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Doctors and health-care workers rallied in Washington on Sunday in support of the health-care bill the House passed that night. President Obama plans to sign the measure into law on Tuesday.
March 22, 2010

Medical residents would find it more affordable to become family doctors, nurses would get financial breaks if they became professors, and teaching hospitals would treat fewer uninsured patients, but be compensated with fewer federal dollars, under landmark health-care legislation scheduled to be signed into law on Tuesday.

The House of Representatives voted 219 to 212 Sunday night to pass the sweeping health bill that the Senate had approved on Christmas Eve. The measure, HR 3590, is expected to extend insurance coverage to an additional 32 million people—a fact applauded by dozens of health- and higher-education groups that have been lobbying for pet provisions over the last year.

At the same time, it would leave about 23 million people, including the nation's undocumented immigrants, uninsured, and it retains a controversial cap on the number of residency positions Medicare finances at teaching hospitals. That cap limits the number of medical-school graduates who can enter the work force.

After approving the health-care act, the House passed a separate "reconciliation" bill, HR 4872, that was crafted by Democratic leaders in Congress last week as a vehicle for winning Congressional approval of both health-care and student-loan legislation. The reconciliation bill contains a number of revisions in the health-care legislation, including more perks for higher education, and must now be approved by the Senate. While such passage is expected, possibly within the week, Republicans have vowed to put up a fight.

With or without the reconciliation changes, the new health-care law will have a far-reaching impact on schools that train health-care workers, on the hospitals and community health centers where they are trained, and on the research being conducted there. Here are a few of the changes they will be seeing, and hoping to see, as the new law is signed and the amendments in the reconciliation bill are considered on the Senate floor.

Teaching Hospitals

Lots of fingers are crossed at these safety-net hospitals, which stand to lose billions of dollars in federal "disproportionate share" payments under the new law. Those are the supplemental Medicaid and Medicare payments that teaching hospitals receive to compensate them for caring for so many uninsured and indigent people.

The Senate bill cut supplemental Medicaid payments by about $18-billion and Medicare payments by $25-billion over 10 years. The reconciliation bill, if it makes it through the Senate, would soften the blow by restoring a total of $7-billion of those cuts.

Officials with the Association of American Medical Colleges are still concerned.

"We want to make sure that people are being adequately insured before we eliminate support for the safety net," says Atul Grover, chief advocacy officer for the association.

Among those who are likely to continue showing up at the hospitals' emergency rooms are many of the nation's approximately 12 million undocumented immigrants, who will be ineligible to buy insurance, even if they can afford it without government subsidies, from the new exchanges that will be set up to help low-income people find affordable plans.

The health-reform act is also expected to increase the number of people eligible for Medicaid by about 16 million, which could also cost teaching hospitals. Because of lower reimbursement rates, the hospitals lose money on Medicaid patients. However, the financial impact of this change is unclear, because some of the new Medicaid recipients would otherwise be uninsured and cost the hospitals even more.

Medical Trainees and Professors

A number of provisions encourage doctors in training to pursue primary-care careers, particularly in rural and other underserved areas. Those provisions include expanded loan and debt-forgiveness options and more money for community health centers, where many primary-care residents train.

The reconciliation bill would add even more money for community health centers. Farheen A. Qurashi, legislative director for the American Medical Student Association, says those centers will play increasingly important roles in patient care and medical training.

Many private doctors refuse to take Medicaid patients because the reimbursement rates are lower than those for Medicare. The reconciliation bill would increase Medicaid payment rates to primary-care doctors to match Medicare rates. However, the changes would be for only two years, 2013 and 2014. The health-care act approved on Sunday did not adjust the rates at all.

Among the groups that had lobbied for higher reimbursement rates was the Committee of Interns and Residents/SEIU Healthcare, a national union representing doctor trainees. Although millions more people will be eligible for Medicaid, "those gains will be undermined if there aren't enough primary-care physicians willing or able to take on this wave of new Medicaid patients," the group said in a written statement.

While the new health-care law provides incentives for physicians to pursue primary care, it does not deal with concerns about a potential shortage of doctors over all. In response to those concerns, new and expanding medical schools have been increasing the number of physicians they are graduating. However, the size of the work force will continue to be constrained as long as the number of Medicare-paid residency slots is capped at 1997 levels, educators argue. An earlier health-reform bill would have allowed Medicare to pay for more training slots, but that measure died in Congress. Teaching hospitals can still create more positions, but they won't be reimbursed for them.

The president of the Association of American Medical Colleges, Darrell G. Kirch, says lifting the cap is essential "so that future physicians can finish their training" and meet the needs of millions of newly covered Americans.

Nursing Education

The legislation includes several provisions aimed at graduating more nurses.

Loan-forgiveness programs will be expanded for nurses who agree to teach in accredited nursing schools, which now face widespread faculty shortages. Those shortages have forced nursing schools to turn away tens of thousands of qualified applicants each year, despite projections of severe nursing shortages.

The legislation also gives nursing schools and academic health centers more flexibility in how they spend certain federal nursing-education grants. The legislation lifted a cap that limited spending on doctoral nursing programs to 10 percent of the total grant amount. In addition, it reauthorizes funding for the Nursing Workforce Development programs, which have been the main source of federal support for nursing education. It also authorizes a Medicare-financed demonstration project at five hospitals to support the clinical education of registered nurses who hold advanced degrees, such as nurse practitioners. The American Association of Colleges of Nursing says those nurses will play a key role in meeting the primary-care needs of the growing number of insured patients.

Student Health-Insurance Costs

Colleges may have a tough time continuing to offer low-cost student health plans unless the legislation is modified in the next few years, according to Steven M. Bloom, assistant director of federal relations for the American Council on Education.

That is because neither the bill approved on Sunday nor the reconciliation bill contains a provision that would exempt those plans from certain federal rules on individual health-coverage plans. The House's earlier health-reform bill, HR 3962, included such an exemption, but that measure was replaced by the bill approved on Sunday.

Without that exemption, students who receive lower rates because they are part of a younger, healthier population would be thrown into a larger pool, where they could end up subsidizing the health-care costs of older, sicker people.

The changes don't kick in right away. "We won't run into any real problems until 2014, so that gives us time to work with the tax-writing committees," Mr. Bloom says. "We don't believe Congress intended to do this, and this will be one of many corrections they'll be addressing" in the coming years.

The council was one of eight higher-education associations that warned, in a letter to key lawmakers in January, that students could face much higher insurance premiums if colleges' plans were not exempted from the new rules.

Conflict-of-Interest Disclosures

The health-care legislation that the president expects to sign into law on Tuesday includes provisions of the Physician Payments Sunshine Act that require drug and medical-device companies to publicly report gifts and payments they make to doctors, including medical professors. "The reporting requirements in the health-care legislation will better protect patients and will help restore trust in our health-care system," says Allan Coukell, director of the Pew Prescription Project, a consumer-safety program of the Pew Charitable Trusts.