Good morning, and welcome to the 2021 ASGE GI Outlook course reinforcing the structural integrity of your GI practice. On behalf of my course co-directors, Latha Allaparthi, Bruce Hennessey, and myself, we would like to thank everyone for joining us at this course. The first session this morning will begin with the pre-recorded session presented by Camille Bonta. After Camille's presentation, we will resume the remainder of the program. Camille has led the advocacy and policy efforts of the ASGE for over a decade. Since launching Summit Healthcare Consulting in 2008, she has guided lobbying, regulatory, and advocacy efforts of numerous national healthcare provider and patient organizations. Camille's efforts on behalf of ASGE have been invaluable. She's an extremely knowledgeable resource and partner with us. We appreciate her presentation. Greetings. I thank the conference co-chairs for inviting me to share what is happening in the legislative and regulatory arenas that have the potential to impact the private practice of gastroenterology. For over a decade, I have served as policy and advocacy consultant for ASGE, whose policy activities are guided by the ASGE Health and Public Policy Committee, which is currently chaired by Dr. Bruce Hennessey. The ASGE is active on all the issues that I will be discussing through the course of my presentation, and at the end of my talk, I will share how ASGE members can get involved in the society's advocacy efforts. When you look at policy changes or proposed changes, it's helpful to understand the drivers of those changes. The first slide presents past and projected national health expenditures and Medicare as a percentage of those expenditures. As you see here, national health spending is projected to grow at an average rate of 5.4% per year from 2019 to 2028, reaching $6.2 trillion. Among major payers, Medicare is expected to experience the fastest spending growth at 7.6% per year over the same time period, largely as a result of having the highest projected enrollment growth. In this slide, we see growth in expenditures broken down by physician and other clinical services, hospital expenditures, and prescription drugs. The growth in expenditures in 2019 outpaced the growth in 2018 across all three expenditure categories, with hospital expenditures growing 6.2% in 2019, faster than the 4.2% growth in 2018. Physician and clinical services expenditures grew 4.6% in 2019, a faster growth than the 4% in 2018, and prescription drug spending increased 5.7% faster than the 3.8% growth in 2018. When you look at projected growth in Medicare spending, it's no wonder the controversial decision by the FDA to approve the Alzheimer drug Adrahelm set off alarms among budget experts, Congress, and policymakers, who have spent years suggesting ways to trim Medicare spending in ways that would save less than the projected cost of this drug, which could reach $56,000 per patient annually. And according to a recent Kaiser Family Foundation study, if one quarter of the 2 million beneficiaries now using already available Alzheimer's treatments and they're prescribed this new drug, the cost would be an additional $29 billion annually. The purpose of highlighting this controversial drug approval is the likelihood of breakthrough and costly therapies and diagnostic tools that will accelerate national healthcare spending. What we see in the chart on this slide is a failure of Medicare payments to keep pace with inflation. When adjusted for inflation and practice costs, Medicare physician payment has actually declined 22% from 2001 to 2020, or by 1.3% per year on average. Congress stepped in last year with a suite of actions to prevent a more than 10% cut to Medicare physician payments. But here physicians find themselves again bracing for a 3.71% cut to the conversion factor next year unless Congress intervenes. In addition to this anticipated cut, the Medicare statutory update has been set at zero through 2025, and the 2% Medicare sequestration, which has been paused for the COVID public health emergency, will resume. And there is also a threat of an added 4% sequestration next year. Before I move on, I think it is beneficial to say a few more words about sequestration because it is affecting physician payments on an ongoing basis and really has only gotten the attention it requires due to the pandemic. Sequestration is a budgetary enforcement mechanism that was created by the statutory Pay As You Go Act of 2010 and the Budget Control Act of 2011. The Budget Control Act established a bipartisan joint select committee on deficit reduction, which was responsible for developing legislation that would reduce the deficit by at least $1.2 trillion from fiscal year 2012 to fiscal year 2021. The joint committee was unable to achieve that goal and automatic spending reductions were triggered. Now, under the Budget Control Act, sequestration of mandatory spending was originally scheduled to occur from fiscal year 2013 to 2021. However, six subsequent actions by Congress have extended the Budget Control Act mandatory sequester of 2% to 2030. I suspect the perception is that physicians and other providers have been operating under the 2% sequester since 2013 without creating loss of access to care for Medicare beneficiaries. The reality is, however, that it is not just a sequester, but the sequester on top of zero updates, conversion factor cuts, and the potential for additional penalties under the Quality Payment Program. And those aren't the only cuts physicians potentially face next year. Earlier this year, Congress passed the American Rescue Plan, which increases the federal deficit by $1.9 trillion. The American Rescue Plan then set in motion PAYGO statute reductions in Medicare spending. The Pay As You Go Act requires the Office of Management and Budget to maintain five- and ten-year scorecards that report the estimated cumulative changes in revenues and outlays generated by new legislation. Now, if either scorecard indicates a net increase in the deficit, the Office of Management and Budget is required to order a sequestration to eliminate the overage. That sequestration would be 4% next year, which is the maximum amount that can be sequestered per the law. Now, it is within Congress's authority to waive PAYGO requirements, and there has been bipartisan support in the past to waive PAYGO. Congress will need to act this year, and there is some concern that Republicans who overwhelmingly voted against the American Rescue Plan will be reluctant to waive PAYGO in this case. ASGE is working within the House of Medicine and by lobbying Congress to prevent this added sequestration, as well as to prevent the 3.71% cut before the end of this year in physician payments. And at the end of this presentation, I will share how you can lend your voice to these efforts. With reductions in Medicare payments, future cuts on the horizon, and increased regulatory burden, the trends in practice consolidation and acquisition are not shocking. These trends remake the healthcare landscape and fuel policy change. The Physicians Advocacy Institute, in partnership with Abilere Health, has looked at ongoing trends of increasing physician employment by hospitals and other corporate entities. In their most recent analysis, Abilere Health researchers studied the two-year period between January 1, 2019 and January 1, 2021, to examine whether physician practice acquisition continued during this time frame, which encompasses the first nine months of the COVID-19 pandemic. Abilere looked at two related consolidation trends at both the national and regional levels. First, acquisition of physician practices by hospitals or health systems and other corporate entities, such as insurers and private equity firms. And second, physicians leaving independent medical practices for employment with hospitals and health systems and corporate entities. As shown in this graph, from January 2019 to January 2021, just over 48,000 additional physicians left independent practice and became employees of hospitals or other corporate entities, with almost half of that after the onset of COVID-19. This represents a 12% increase in the percentage of employed physicians over the two-year study period. In this graph, we see the growth in the acquisition of hospital and other corporate entities of physician practices. And over the two-year study period, hospitals and other corporate entities acquired 20,900 additional physician practices, resulting in a 25% increase in corporate-owned practices. Again, we see rapid growth in acquisition after the onset of the pandemic. Here we look at growth in corporate-owned practices over the same two-year period. Corporate-owned entities include health insurers and private equity firms and are not classified as integrated delivery networks. According to the Avalere analysis, corporate entities acquired almost 18,000 additional physician practices over the two-year period. Consequently, almost 30,000 additional physicians left independent practice and became employees of corporate entities. Of that shift, just over 11,000 occurred after the onset of COVID-19. This represents a 48% increase in the percentage of corporate-employed physicians over the two-year study period. The landscape of practice consolidation and acquisition gives us an appreciation of just some of the issues that impact GEI practices, including surprise billing restrictions, ASC reporting, practice ownership and price transparency, and site-neutral payment policies. For the remainder of my presentation, I'm going to walk through some of these issues. I'm going to first talk about surprise billing. An examination of out-of-network billing published in JAMA showed a significant jump in emergency department and inpatient visits with an out-of-network bill. I then overlay that data with the growth in physician practices with private equity investments, which was pulled from a June report from the Medicare Payment Advisory Commission. One conclusion is that the growth in prominence in the healthcare sector of private equity firms in recent years largely reflects the actions of companies that have been acquired through buyouts. For example, some of the physician staffing companies that have engaged in surprise billing have been owned by private equity funds that have pursued such buyouts. The increase in the growth of out-of-network bills led to action by Congress last year with the passage and enactment of the No Surprises Act. Most provisions of the law will take effect next year, and two rules implementing the law have been released, which I will speak to more in a moment. There were a number of concerns that were raised by the physician community during the debate over surprise billing, including how provider payments for surprise bills are negotiated when patients are held harmless. But the fight against restrictions on surprise billing was fought hardest by the physician staffing groups that generate large amounts of surprise medical bills. The staffing groups behind the dark money group, Dr. Patient Unity, supply emergency room doctors, radiologists, and anesthesiologists to hospitals, specialties, of course, that are among the most likely to be out-of-network for patients. I'm going to briefly cover what the No Surprises Act does because I suspect you'll start to hear more about it, and there are provisions that will impact ambulatory surgery centers. First and foremost, the law protects patients from receiving surprise medical bills resulting from gaps in coverage for emergency services and certain services provided by out-of-network clinicians at in-network facilities. The law protects patients by holding them liable only for their in-network cost-sharing amount while giving providers and insurers an opportunity to negotiate reimbursement. Providers and insurers can access an independent dispute resolution process in the event disagreement arises around reimbursement. The law also requires both providers and health plans to assist patients in accessing health care cost information, including a good faith estimate from an out-of-network provider for non-emergency services. In July, the Biden administration released the first round of rules implementing the No Surprises Act. What the first rule lays out is the prohibition of balanced billing by non-participating providers and facilities. Instead, those non-participating providers and facilities must agree to an amount of payment with plans or issuers, or they must enter into the independent dispute resolution process to determine an appropriate payment amount if agreement on a payment cannot be reached. The rule also lays out that balanced billing will be allowed in certain situations, such as if a patient seeks care from an out-of-network provider, but only if certain notice and consent requirements are satisfied. The protections against balanced billing apply to most emergency services, air ambulance services from out-of-network providers, and non-emergency care from out-of-network providers in certain in-network facilities, including in-network hospitals and ambulatory surgical centers. And finally, the law requires, and the rule lays out, certain health care providers and facilities, including ambulatory surgery centers, to provide a one-page patient notice on balanced billing restrictions, prohibitions, and limitations. The second rule, which was recently released and open for public comment until December 6, lays out the Independent Dispute Resolution process, or IDR process. In the rule, it is the position of the Departments of Health and Human Services, Treasury, and Labor that the certified IDR entity must begin with the presumption that the qualifying payment amount, which is the median in-network rate, is the appropriate out-of-network rate for the item or service under consideration. In a recent forum with these departments, the ASGE vocalized that by leading with the presumption that the median in-network rate is the appropriate out-of-network rate tips the scales in favor of the insurance companies. Furthermore, the departments have taken significant liberty with their interpretation of the law, which clearly states that additional circumstances, such as the training and experience of the provider, should be considered alongside the median in-network rate. Even Congress has spoken up, with 152 members sending a letter to the departments earlier this month saying it was not their intent for the in-network median rate to take prominence over other considerations and circumstances during the Independent Dispute Resolution process. When we tie it all together, we are witnessing a consequence of low reimbursement rates which have driven providers out-of-network and have fueled the prominence and popularity of employed staffing models that have built business models on the ability of being able to balance bill patients. I now want to turn just briefly to the issue of ASC cost reporting, which has really become a perennial discussion topic within the Medicare Payment Advisory Commission, with commissioners holding the position that ASCs should be required to submit cost reports so payment updates can be appropriately determined. And currently, CMS is seeking comment from the public through the Hospital Outpatient and ASC Payment Proposed Rule on cost reporting methods that the provider community thinks would not be burdensome so that an appropriate update can be calculated in the future. Right now, ASC updates are being pegged to the Hospital Market Basket Index, which is something that ASGE fought for instead of CMS using the Consumer Price Index. But the use of the Hospital Market Basket Index only runs through 2023. And I think that there are legitimate concerns about the cost reporting burden and the accuracy of those cost reports, but at the same time, the opposition to cost reporting also makes it very difficult to advocate for more favorable ASC payment policies. I'm now going to turn back to private equity and what I think we can expect to see from policymakers. The House Ways and Means Committee, which has primary jurisdiction over Medicare in the House, instructed the Medicare Payment Advisory Commission to begin examining the role of private equity in healthcare. While private equity deals were drawing increased attention from policymakers prior to COVID, COVID deaths among nursing home residents increased that level of scrutiny, which has led to a report just this past June from MedPAC, as well as congressional hearings on the topic. In that June report, MedPAC did not include any recommendations, but instead focused on the lack of transparency in ownership information and, for physician practices, the minimal peer-reviewed empirical evidence of the impact of private equity ownership on Medicare spending quality of care and patient experience. The MedPAC report suggested that pressure some private equity firms apply to clinicians to increase revenue could lead to higher spending as consolidation creates market power to negotiate higher payment rates, although really not directly relevant to Medicare because rates are set vis-a-vis a fee schedule. The commissioners also highlighted that where investment activity is occurring may be an indicator of where payment policies should be re-examined, such as site-of-service differences. What I did find really interesting in the discussions among members of the MedPAC commission is acknowledgment that environments of uncertainty offer shelter from the storm for physician practices and that it is important for policymakers and those advising policymakers to recognize that they have a role in minimizing the opportunity for undesirable behavior by healthcare providers, whether it's private equity or not. This is an easy, aspirational thing to say, but the trends highlighted in the tables I presented earlier demonstrate that the accumulation of policy decisions have ramifications. What we know is that Congress and regulators, what they don't do well is they don't take a nuanced approach to policymaking. Instead, they tend to react with sweeping policies that create new perverse incentives that trigger further regulation. Now earlier this year, the Ways and Means Oversight Subcommittee held a hearing on private equity in healthcare where there was also widespread agreement that more transparency about ownership is needed, and that seems like it will be the starting point for congressional action which could help the government better understand private equity and whether or not it has a positive or negative effect on quality and on healthcare costs and access to care. Other levers discussed during that subcommittee hearing that could be used by the federal government included requiring cost reports, greater financial oversight, and essentially prior authorization for changes in ownership. The frustration among providers of the growing interference by payers in medical decision-making and the use of utilization control mechanisms like step therapy and prior authorization really seem to have reached a fever pitch. The ASGE and other specialties have turned a great deal of advocacy attention to fighting individual payer policies but also advocating for federal intervention. Utilization control tactics, as you all know, are administratively burdensome and can lead to delays in care, but the aggressiveness with which they are being employed is, I think, a response to rising drug costs as well as vertical and horizontal consolidation and the effects consolidation has on utilization and cost. Using imaging as examples on how consolidation and the shift to more employed physicians, we see in this graph that while utilization for advanced diagnostic imaging fell dramatically after 2009 and then leveled out, the portion of imaging performed in the hospital outpatient department increased significantly, likely reflecting the shift of services to the more expensive hospital outpatient setting. Two recent studies published in Health Affairs found that doctors employed by hospitals were more likely to order inappropriate MRI tests and that overall testing volume spiked after hospitals acquired physician practices. As shown in this table, the study findings indicate that the odds of a patient receiving an inappropriate MRI referral increased by more than 20% after a physician transitioned to hospital employment. Those patients who received an MRI referral by an employed physician obtained the procedure at the hospital where the referring physician was employed. These results point to hospital physician integration as a potential driver of low-value care. So while we have consolidation and integration occurring, the frustration among physicians with prior authorization is growing as payers respond, and these charts reflect the results of a fairly recent survey of eight medical specialties, including dermatology, neurosurgery, OBGYN, ophthalmology, orthopedic surgery, otolaryngology, plastic surgery, and urology. And 84% of the physicians reported that the burden associated with prior authorization has significantly increased over the past five years, including for procedures, diagnostic tools, and prescription medications. And over the last six to eight months, the GI community has experienced a flurry of activity by payers in the biologic space, most revising formularies that force patients to switch to biosimilars for the treatment of IBD and changes in formularies that make it more difficult for gastroenterologists to choose the most appropriate bowel props for their patients. We are also seeing payers dictating dosing for infliximab, irrespective of a patient's dosing history. And ASGE, in partnership with the other GI societies, have been pushing back on payers, but mostly with limited success, which underscores the necessity of intervention from state and federal lawmakers to curb payer practices and processes that result in patient harm or unnecessary administrative burden. There are two bills currently pending in Congress that have the endorsement of ASGE that would help to mitigate the burdens of step therapy and prior authorization protocols. The SAFE Step Act, which has been introduced in the House and the Senate, would create a clear, timely, and transparent process for a patient or physician to request an exception to step therapy protocols in certain situations, including when a patient is stable on current medication. The Improving Seniors' Timely Access to Care Act has been introduced in the House and the Senate. In fact, the House bill already has reached co-sponsorship of a majority of House members and is being actively supported by ASGE and nearly the entire physician community. The legislation increases transparency and streamlines prior authorization in the Medicare Advantage program, including by establishing an electronic prior authorization program and streamlining the prior authorization process for items and services that are routinely approved on appeal. In a few moments, I will share ways that you can help support and advocate for these bills. When I talk about sweeping effects of policy changes that would be better targeted, a good example is the Medicare Appropriate Use Criteria Program for Advanced Diagnostic Imaging, and it's pretty likely you haven't heard of this program because CMS has struggled to bring it to implementation since the program was created by Congress in 2014. This program, however, if ever implemented, would apply to every clinician who orders and or furnishes an advanced diagnostic imaging test. Ordering clinicians under the program would be required to consult a qualified clinical decision support mechanism and transfer required information to the furnishing clinician who must put that information on a claim form to be paid for the test. CMS has indicated that it is aiming to activate the penalty phase of the program in 2023, and the vast majority of the physician community is advocating for repeal of this program, which has really become outdated and would operate entirely outside of other quality improvement programs. I'm going to wrap up this policy overview with the issue of site neutrality. This table is from the most recent Medicare Payment Advisory Commission report, which shows the growth in clinic visits in hospital outpatient departments, which we could reasonably conclude is a result of hospital acquisition of physician practices and the increasing number of employed physicians. In 2018, CMS finalized a rule that would extend site-neutral payment policies to hospital outpatient clinic visits that occur in off-campus provider-based departments. That policy took effect in 2019 and was met by a legal challenge from the American Hospital Association that argued CMS exceeded its statutory authority because off-campus provider-based departments were exempted when site-neutral policies were passed by Congress in 2015. The American Hospital Association lost its argument on appeal, and the U.S. Supreme Court recently declined to review the case. Now I think providers need to prepare for an expansion of site-neutral payment policies. While I think that there are many who believe that equalizing payments in the hospital outpatient in ASC settings will be favorable to ASCs, if CMS were to drop hospital outpatient rates for services also provided in ASCs to the ASC rate to achieve site neutrality, it would assume that rates paid to ASCs are adequate, and in the case of GI procedures, that those rates adequately cover the cost of equipment and supplies. And I'm also concerned that site-neutral payment policies between the hospital outpatient and ASCs could take away any leverage that ASCs may otherwise have to improve rates for services for which Medicare reimbursement is inadequate. I thought that this would be a good graphic to end the presentation because I think it best summarizes the environment that I just walked through. Payment cuts and administrative burden are driving consolidation and practice acquisition, which has an effect on healthcare spending, which triggers new payment and practice policies that exacerbate consolidation and the shift to employed physicians. And so if there is a self-perpetuating circle in healthcare policy, I think that this is a pretty good depiction of it. I think it's really important that ASGE members understand that there's a role for them in advocacy and that the society provides the tools so its members can advocate on behalf of their practice, their profession, and their patients. ASGE members can contact their members of Congress through the ASGE Action Center, and that Action Center can be found at asge.org backslash takeaction. Currently, ASGE members are being asked to encourage their members of Congress to stop physician Medicare payment cuts and to support legislation that will reduce payer interference in physician decision-making. A template alert is provided for you that you can personalize and email to your members of Congress in a matter of minutes. These alerts change periodically depending on what is happening in Congress. I encourage you all to take a moment to get involved in advocacy through this simple and straightforward action. I want to thank you for taking the time to listen to this presentation. I hope that we can all be together in person for next year's conference. In the meantime, I encourage you to reach out to me directly with any questions at cbanta at summithealthconsulting.com. Thank you.

private practice of gastroenterology

Medicare expenditures

physician employment

private equity in healthcare

surprise billing

prior authorization

physician decision-making