October 31, 2005

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Insurance Superintendent Issues Decision on Dirigo Savings Offset Payment
Following two days of hearings, Insurance Superintendent Al Iuppa on Saturday, Oct. 29 issued his much-anticipated decision on the Savings Offset Payment authorized in the Dirigo Health legislation. The Superintendent's decision paves the way for the payment to be made by health insurance carriers who are expected to add the payment onto existing premiums. The Dirigo Health Agency Board will meet at 1:00 p.m. Thursday, Nov. 10 in Augusta to determine how much of the identified savings should be utilized for the DirigoChoice offset payment.

The State had claimed that the aggregate savings calculation for the savings offset payment (SOP)  was $110.6 million, while the insurers and employer coalition had alleged that savings attributable to Dirigo was in the range of $30 million.   In his 19-page decision issued Saturday, the Superintendent disallowed much of the state's proposed savings but did find that $43.7 million was deemed reasonably supported by the evidence presented.  It is not yet clear the amount the carriers will pass on to premium payors, as the Dirigo Health Board now determines how much of the savings is to be utilized for the SOP, but it will probably be in the range of 2 to 4% of claims paid.  Interested parties to the proceeding also have 30 days in which to initiate an appeal of the decision to the Superior Court.  It does appear that the State was hoping for a finding of at least $50 million which would be the approximate amount the program needs to continue the DirigoChoice product next year.  $43 million is certainly close enough so that a fully funded program can be implemented.

On Sept. 19th, the Board of Directors of the Dirigo Health Agency filed with the Superintendent its determination of cost savings associated with the passage and implementation of the Dirigo Health legislation.  Under the legislation, the Board was required to file with the Bureau of Insurance its determination as to the aggregate measurable cost savings in the State, including any reduction or avoidance of bad debt and charity care cost to health care providers as a result of the operation of Dirigo Health and any increased MaineCare enrollment due to an expansion in MaineCare eligibility occurring after June 30, 2004 as well as the supporting information for that determination.

Of particular interest to physicians, the Dirigo Board included in its calculation of savings the $8.2 million in annual increased MaineCare payments to physicians.  These payments are considered a savings to the healthcare system under the provisions of the law inasmuch as physicians may not have as much charity care and bad debt because of the increased payments (as the theory goes). The law makes no provision for consideration of the possibility that other costs and expenses may have more than offset any potential savings to the physician office.  The Superintendent found that these savings were attributable to Dirigo Health and they are part of the $43.7 million in aggregate savings.

Copies of the 19-page order are available to MMA members by calling MMA at 622-3374, x212.  This is Gordon Smith's extension and leave a message that you would like a copy of the decision and order.  The decision may also be read at the Bureau website at:  http://www.maine.gov/pfr/ins/ins05700Dirigo.htm.

You can read the Governor's comments about the decision on the web at:  http://www.maine.gov/tools/whatsnew/index.php?topic=Portal+News&id=9686&v=article-2004.




Update on Maine Health Information Technology Project (MHINT)
MMA representatives received an update on various aspects of the MHINT project at a meeting of the MHINT Governance Committee last Tuesday, Oct. 25. MMA is represented on the Committee by Paul Klainer, M.D. and EVP Gordon Smith, Esq. The meeting represented the 4th time the Committee had met during Phase II of the project and at least two additional meetings are planned. Phase II is finishing up its first 6 months of what is expected to be a 12 month phase. Phase II began with $200,000 in start up funds contributed by the Maine Health Access Foundation, the Maine Bureau of Health and the Maine Quality Forum. Additional funds have since been contributed by the Osteopathic Heritage Foundation, the Betterment Fund, the Davis Foundation, the Bingham Fund, Anthem and the four major hospital systems in the state.

An Action Plan for Transition to MHINT Organization has been developed by the Committee and consists of the following points.

1. Translate feedback from Feasibility Phase and Hanley Forum regarding a governance entity for MHINT Program.
2. Review governing entity options (for profit, non-profit, LLC, subsidiary, etc.).
3. Address "new" entity vs. "existing entity".
4. Address Board composition including majority representation, representation tied to financial contribution, etc.
5. Address role and responsibilities of Board of Director members.
6. Develop approach for inviting organizations and individuals to attend an Introductory meeting.
- Present Hanley Forum Executive Summary
- Present Committee Recommendations
- Identify Plan for Establishing MHINT Organization

At the meeting, committee members agreed to recommend that any potential organization be governed by a non-governmental, non-profit organization. At the next meeting on Nov 15, the committee will consider the issue of the role and make up of the Board.

Committee members also heard an update on the activities of the Technology Committee. Following the issuance of a Request for Information, the committee received 16 responses, narrowed the field to 5 finalists and will meet for 2 and 1/2 hours with each of the five companies on Nov 29 and 30. The five companies are 3-M, Accenture, ACS Healthcare, Healthvision and Wellogic.

The third major Committee involved in the project is a Consumer Stakeholder Group that is developing a series of recommendations regarding "Patient and Consumer Priniciples for System Design." These principles will include recommendations on the right of each patient to agree to be in the database. [return to top]

Governor's Office of Health Policy and Finance Announces Proposed Value of Capital Investment Fund for 2006
Pursuant to Chapter 101 of its rules, the Governor's Office of Health Policy and Finance (GOHPF) issued a notice on Oct. 28, 2005 regarding the proposed value of the Capital Investment Fund and to solicit public comments on the proposal.  The Capital Investment Fund (CIF) is a limit on the total third year operating costs that may be approved under the state's Certificate of Need program each year.  Statutory provisions establishing the CIF were included in the Dirigo Health legislation, enacted in 2003.

As specified in Chapter 101 of the rules, the CIF is calculated according to a formula that is based largely upon the average total third year costs for projects approved under CON in each of the past 5 years, spreading the cost of projects with costs greater that $2 million over multiple years, counting no more than $2 million per year, and inflating each year's total to 2005 dollars.

Several other adjustments are then made, including dividing the amount into hospital and non-hospital projects.  The amount proposed as the final CIF value for the next year is $7,711,794 with $963,974 of the total reserved for non-hospital projects.

A public hearing will be held on Wednesday, Nov. 16, 2005 on the proposal.  The hearing will be held at the offices of the Dirigo Health Agency at 211 Water St., in Augusta.  The hearing will begin at noon.  Commenters are specifically requested to address errors in computation on the Fund amount, as well as advances in technology that should be considered when sizing the Fund.

Written comments regarding the proposal will be accepted through 5:00pm Nov. 28, 2005.  All comments are to be directed to;  Ellen Jane Schneiter, Deputy Director, GOHPF, 15 State House Station, Augusta, Maine 04333-0015.  Comments may be submitted electronically to Ms. Schneiter's attention at ellen.schneiter@maine.gov. [return to top]

Space Available for Friday Education Program on Medicare Part D in Manchester
MMA this coming Friday presents, "The Medicare Modernization Act (MMA) - What Every Practice Needs to Know, from 9:00am to noon at its offices in Manchester.  A first-class faculty from the State Office of Elder Services, CMS, and elder advocacy groups, including the AARP, will discuss what you need to know about the Medicare Part D prescription drug benefit which takes effect Jan. 1, 2006.  The focus will be on the practical aspects of what a physician office can do to assist seniors with the difficult Part D decision.  Other aspects of the MMA will be discussed as well.

The cost for the session is only $60 which includes breakfast and all the course materials.  The agenda for the morning is as follows:

9:00 am   Welcome& Background on the Medicare Modernization Act

9:10      Overview of the Medicare Part D Benefit - Key Points for Physicians

10:15   Break

10:30   The Medicare Part D Benefit - A Perspective from the Region I Office of CMS

11:00   The Medicare Part D Benefit - AARP's Perspective

11:15    The Medicare Part D Benefit - Consideration for the Low-income & Disabled  Populations

11:30    The Medicare Part D Benefit - An Industry Perspective

11:45    The Medicare Part D Benefit - Behavioral Health Considerations

12:00    Wrap up/Q & A







Call 622-3374 x210 now to reserve your seat or e-mail gbegin@mainemed.com. [return to top]

Best Practices for Decontamination, Disinfection and Sterilization of Instruments in the Physician Office Presented THIS WEEK
MMA teams up with Affiliated Healthcare Systems this week to present a seminar entitled, Best Practices for Decontamination, Disinfection and Sterilization of Instruments in the Physician Office.  The instructor is Nancy Chobin, R.N., AAS, CSPDT, CSIT, CSPDM.  The program will be held from 8:30am to 1:00pm on Nov. 1 in Bangor (Spectacular Event Center), Nov. 2 in So. Portland (Sheraton) and Nov. 3 in Bedford, N.H. (The Quality Inn, Wayfarer Convention Center).

Regulatory and safety issues associated with chemicals and sterilzation methods will also be identified and reviewed.  The cost is on $65 for MMA members or their office staff.  Call 800-648-2727 to register. [return to top]

Quality Counts! Part III in Augusta Dec. 6
MMA members interested in learning more about transformational change needed to improve chronic illness care and prevention should attend the 3rd session of the popular Quality Counts! initiative on Dec. 6 in Augusta.  The two previous programs have attracted nearly 300 persons each.  The Program runs from 9:00am to 4:00pm. The Keynote presentation will be by David McCulloch, M.D. from Seattle, Washington.

Registration is $50 per attendee.  For more information, call Judy Tupper at 207-228-8407 or Hilary Skillings at the Muskie School at 207-780-4567.  The MMA is a co-sponsor of the program. [return to top]

Save the Date: Dec. 14 for "Prepare Your Community for Pandemic Flu" in Augusta
On Dec. 14, 2005, the Department of Health and Human Services - Public Health, the Maine Emergency Management Agency and Maine EMS team up to present, "Prepare Your Community for Pandemic Flu", at the Augusta Civic Center in Augusta.  Watch this publicaiton for more information.

On October 27, 2005, the U.S. Senate voted 94-3 in favor of a FY 2006 funding bill for the U.S. Department of Health & Human Services that includes almost $8 billion to prepare for a possible outbreak of avian flu.  On the same day, DHHS Secretary Michael O. Leavitt outlined the Bush Administration's plan to prepare for an avian flu outbreak in a speech before the National Press Club.  The HHS plan will have 4 key components:

  • intensifying surveillance of the flu strains and outbreaks by providing scientists access to the latest flu strains to study;
  • developing stockpiles of flu antivirals and vaccines;
  • creating a network of federal, state, and local authorities to create a seamless network of preparedness; and
  • expanding the BioSense program that provides hospitals and health care providers with access to real time public health data.
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Staff and Phone Changes at MMA
The MMA announces the following staff changes, effective immediately.  Kathleen LaCroix, who was staffing the Coding Center and providing receptionist support at MMA is no longer with us.  In addition, Chandra Leister, who has been with us for 2 and 1/2 years has chosen to take a position closer to her home in Yarmouth.  MMA wishes both Kathleen and Chandra success in their transitions.

These positions may not be filled soon and the responsibilities have been assigned to others in the office.  An up-to-date list of assigments will appear in the Nov.-Dec. issue of Maine Medicine and will be published in the Weekly Update, as well.

Because of the shortage of staff, we have decided to replace the live receptionist with voice mail, at least temporarily.  We regret the need to do this, but budgetary concerns require it.  When you do call, you may press 0 as soon as the voice mail begins and a live person will answer.  Of course, we would appreciate it if you would go directly to the extension of the person you are calling, if you know that extension.  The list of extensions follow:

Gail Begin, Ext. 210

Warene Chase-Eldridge, Ext. 227

Heidi Lukas, Ext. 217

Andrew MacLean, Ext. 214

Lisa Martin, Ext. 221

Diane McMahon, Ext. 216

Lauren Mier, Ext. 223

Buell Miller, MD, Ext. 228

Charyl  Smith, Ext. 211

Gordon Smith, Ext. 212

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Senate Finance Committee Moves One-Year Fix to Medicare Physician Payment Issue
On the national scene, the Senate Finance Committee last week approved on a party-line vote of 11 to 9 a budget reconciliation bill that provides a one-year fix to the physician Medicare payment issue.  The proposal prepared by Committee Chair Charles Grassley of Iowa provides for a 1% increase in physician fees rather than the 4.4% reduction in fees provided for in current law.  The proposal also contains a Pay-for-Performance provision which could kick in by 2007.

Maine Senator Olympia J. Snowe supported the package of reforms and was instrumental in limiting cuts to the Medicaid program.  She has been an effective advocate for fixing the sustainable growth rate formula which penalizes physicians for growth in the Medicare payments.  Unfortunately, the Grassley proposal only fixes the problem for one year and does not modify the underlying SGR formula.  The formula needs to be permanently changed or deep reductions in physician payments will take effect in years beyond 2006.

The Senate Finance Committee proposal to save $10 billion over 5 years relies primarily on prescription drug payment reforms and does not impose any increased cost sharing on Medicaid beneficiaries.

On October 28, 2005, the House Energy & Commerce Committee voted 28-22 to approve a budget reconciliation package expected to save $11 billion over 5 years.  The House plan, opposed by Committee Democrats, changes the reimbursement formula for prescription drugs, imposes new cost-sharing requirements on Medicaid beneficiaries, gives Governors more flexibility in designing benefit plans for Medicaid, and tightens requirements for qualifying for long term care coverage by Medicaid.

Senate Finance Committee Chairman Grassley has predicted that it will take a long time to work out the differences between the House & Senate reconciliation bills. [return to top]

Legislative Council Reviews Rank & File Bill Requests for Second Session
On Thursday, October 27, 2005, the 10 members of the Legislative Council (6 Democrats & 4 Republicans; the presiding officers of the Senate & House, as well as the caucus leadership) met to screen for consideration during the Second Regular Session of the 122nd Maine Legislature, bill requests from rank & file legislators.  In the Maine Medicine Weekly Update last week, the MMA published a list of bill titles and legislative sponsors of likely interest to the MMA and the physician community.  The Legislative Council admitted the following bills from that list:

LR 2785, An Act to Prevent the Use of Nutritional Supplements by Maine Student Athletes (Sen. Brennan)

LR 2817, An Act to Establish Requirements and Standards for Health Savings Accounts for Small Businesses (Rep. Cummings)

LR 2450, An Act to Provide Access to Birth Records by Adopted Persons (Rep. Davis)

LR 2809, An Act to Protect Health Insurance Consumers (Sen. Martin)

LR 2693, An Act to Amend the Maine Insurance Guaranty Association Act (Sen. Sullivan)

LR 2991, An Act to Improve Retention, Quality and Benefits for Direct Care Health Workers (Sen. Edmonds)

LR 2896, An Act to Ensure Coordination and Effectiveness in the Provision of Outpatient and Medication Management Services Under Maine's Noncategorical Waiver (Rep. Brannigan)

LR 2464, An Act to Ensure the Authority of "Do-Not-Resuscitate" Orders in Health Care Directives (Sen. Bryant)

LR 2448, An Act to Amend the Laws Governing Living Wills of Terminally Ill Persons (Rep. Grose)

LR 2603, An Act to Enhance Health Care Safety (Speaker Richardson)

LR 2629, An Act to Guarantee Access to Medically Necessary Medications During the Implementation of the Medicare Part D Prescription Drug Program (Sen. Brennan)

LR 3029, An Act to Maintain Prescription Drug Benefits for Seniors and People with Disabilities (Rep. Pingree)

LR 2630, An Act Permitting the Recycling of Unused Prescription Drugs (Sen. Sullivan)

LR 2614, An Act to Prevent the Introduction of Chronic Wasting Disease (Rep. Watson)

LR 2852, An Act to Clarify the Accountability of Advanced Practice Registered Nurses (Rep. Perry)

LR 2586, An Act to Amend the Law Regarding Smoking In Private Clubs (Rep. Grose)

LR 2647, An Act to Clarify the Workplace Smoking Laws (Sen. Turner)

LR 2895, An Act to Allow Employers to Make Payments for Undisputed Portions of Workers' Compensation Claims (Sen. Weston)

All other bill requests on the list from last week were rejected by the Council or withdrawn by the sponsor.  The Legislative Council is scheduled to notify members of the decisions today and members can submit an appeal of a rejection by Monday, November 7, 2005.  The Legislative Council will meet to consider appeals on Thursday, November 17, 2005 at 10:00 a.m. in the Legislative Council chambers at the State House.

The 122nd Maine Legislature's agenda for the second session beginning in early January 2006 will include:

  • Bills carried over from the first session (available in the MMA's interim legislative summary);
  • Bills admitted through the Legislative Council;
  • One or more supplemental budget bills; and
  • Any bill submitted by the Governor.
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For more information or to contact us directly, please visit www.mainemed.com l ©2003, Maine Medical Association