The Energy and Commerce Subcommittee on Health held a hearing last Wednesday, April 18, 2007 to investigate ways to curb wasteful spending within the Medicare program and root out fraud and abuse. Testifying before the committee were representatives from the Medicare Payment Advisory Commission (MedPAC), the Centers for Medicare and Medicaid Services (CMS), the Office of the Inspector General for the Health and Human Services Department, and the Health Care Fraud Department of the Department of Justice.

Democrats on the subcommittee focused in large part on the possibility of reducing the higher payments to Medicare Advantage plans as a potential way to cut spending in the program. On average, these managed care plans receive 12 percent higher payments than traditional fee-for-service Medicare plans for the purpose of providing expanded benefits to enrollees. Rep. Frank Pallone (D-N.J.), chairman of the subcommittee, said, "These excessive payments are wasteful and result in unnecessary costs for the program and its beneficiaries, as well as the American taxpayer."

Medical imaging was a topic of interest to Rep. Nathan Deal (R-Ga.), the subcommittee's ranking Republican. "One area of inefficiency which has always been a concern for me is the area of imaging," said Rep. Deal, echoing past concerns Congress has had with the growth in volume of imaging services. He went on to say, however, "It's my belief that the payment reductions made in the Deficit Reduction Act were a blunt instrument to address the imaging issue, and I hope the committee will take a more thorough look at this area to craft an imaging policy that prevents over-utilization."
Mark Miller, MedPAC's executive director, testified that growth in both imaging and minor procedures is outpacing growth in other areas of Part B and that his commission and others have expressed concern that differential growth in volume is due in part to the profitability of some services. Miller went on to say, "To maintain the integrity of the physician fee schedule, we recommend that CMS play a lead role in identifying overvalued services so that they are not ignored in the process of revising the fee schedule's relative weights." Rep. Lois Capps (D-Calif.) pointed out, however, that slashing physician reimbursement for diagnostic tests is driving patients back to the hospital, which can be more costly.

Wednesday's hearing was part of a continued effort by the new Democrat majority to exercise Congress' responsibility as the steward of taxpayer dollars and to ensure that government programs are implemented fairly and are running efficiently.

In a written statement, Rep. John Dingell (D-Mich.), chairman of the full Energy and Commerce Committee stated, "The program should be neutral in its payments to providers - encouraging the right care at the right time in the right setting. This means constant oversight on the part of both Congress and CMS."

For more information regarding the ACR's advocacy efforts, please contact Senior Director of Government Relations Josh Cooper at jcooper(at)acr.org or Assistant Director of Congressional Affairs Orrin Marcella at omarcella@acr.org.

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