Most can agree that understanding complex healthcare laws is challenging.
But having a clear explanation of the key provisions in the Protecting Access to Medicare Act (PAMA) doesn't have to be complicated.
In this post, we'll walk through PAMA's background, purpose, major sections, and impact in an easy-to-understand way. You'll learn exactly what PAMA did to reform Medicare physician payments and mental health services, along with how it has shaped US health policy.
Introduction to the Protecting Access to Medicare Act of 2014
The Protecting Access to Medicare Act (PAMA) was passed in 2014 to reform how Medicare payments to physicians are determined. This section outlines PAMA's objectives and the healthcare issues it aimed to address.
The Genesis of PAMA in Healthcare Policy
PAMA emerged from ongoing efforts to reform Medicare's flawed Sustainable Growth Rate (SGR) formula, which tied physician payments to economic growth. As costs rose faster than growth, this produced a cycle of automatic payment cuts and temporary fixes by Congress. PAMA provided a permanent solution by repealing the SGR and establishing a new value-based payment system.
PAMA built on reforms in the Affordable Care Act and bipartisan policy goals to transition Medicare towards quality of care rather than quantity of services. This aligned payments with value-based models already gaining traction in the healthcare industry.
Objectives and Scope of the Medicare Act of 2014
The primary objective of PAMA was stabilizing Medicare physician payments through permanent repeal of the SGR formula. This removed the recurring threat of automatic cuts.
PAMA also established a merit-based incentive payment system to reward physicians based on quality, resource use, clinical practice improvement, and meaningful electronic health record use. This expanded pay-for-performance reforms.
While focused on Medicare Part B, PAMA had limited scope beyond physicians. Its value-based payment reforms laid groundwork for wider adoption of alternative payment models.
The Role of the 113th United States Congress in Enacting PAMA
PAMA was shaped through bipartisan negotiation between the Republican-controlled House and the Democratic Senate. An earlier agreement fell apart, but negotiations continued due to pressure from physician groups.
The final version won overwhelming bipartisan approval in Congress. This demonstrated recognition across party lines of the need for long-term Medicare payment reform centered on quality of care.
Understanding PAMA's Significance in Medicare Reform
PAMA marked a milestone in transitioning Medicare towards value-based payment. By repealing the broken SGR formula, PAMA achieved long-standing bipartisan policy goals of payment stability and flexibility for physicians.
Its reforms built momentum behind quality of care as a key metric for physician payments and medical practice improvement. This has driven further value-based payment adoption in Medicare and private insurance.
While limited in scope, PAMA set the stage for wider reforms aligning Medicare payments with value for beneficiaries rather than volume of services. This has helped improve quality of care while controlling costs.
What is the Protecting Access to Medicare Act of 2014?
The Protecting Access to Medicare Act (PAMA) of 2014 was signed into law by President Obama on April 1, 2014. This legislation prevented a scheduled payment reduction for physicians and other healthcare practitioners treating Medicare patients from going into effect on April 1st of that year.
PAMA was introduced in the 113th United States Congress as a response to the flawed sustainable growth rate (SGR) formula used by Medicare to control spending on physicians' services. The SGR formula tied Medicare physician payment rates to growth in the overall economy. If spending exceeded the SGR target in a given year, future physician payment rates were reduced to bring spending back in line.
However, these scheduled payment reductions were consistently overridden by Congress. By 2013, physicians were facing a 24% cut in payments which led to uncertainty and frustration over the recurring need for short-term fixes.
To remedy this, PAMA repealed the SGR formula and provided certainty regarding Medicare physician payments through 2024. In doing so, it prevented the 24% payment reduction that was set to hit physicians on April 1, 2014.
Key things to know about the Protecting Access to Medicare Act:
- Passed with bipartisan support in both the House and Senate
- Introduced in response to flawed Medicare SGR formula
- Prevented 24% payment cut to physicians scheduled for April 1, 2014
- Provided stable Medicare physician pay rates through 2024
- Repealed the Sustainable Growth Rate (SGR) formula for determining Medicare physician fees
By repealing the problematic SGR formula and establishing a predictable payment system, the Protecting Access to Medicare Act provided much-needed certainty regarding physician pay under Medicare. This helped reassure both physicians and Medicare beneficiaries.
What is the delay in Protecting Access to Medicare Act?
The Protecting Access to Medicare Act (PAMA) was passed in 2014 to make changes to how Medicare pays for clinical laboratory services. As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in 2020, Congress included a one-year delay of payment cuts to clinical labs under PAMA.
Specifically, the CARES Act delays the next data reporting period under PAMA by one year, from 2021 to 2022. This means clinical labs will not have to report private payer data in 2021 and accept payment cuts in 2022 based on that data. The delay aims to provide temporary relief to clinical labs during the COVID-19 pandemic.
Additionally, the CARES Act pauses the payment cuts for clinical lab services that were set to begin in 2021 for one year. The cuts will now take effect in 2022 instead. This pause intends to protect vulnerable Medicare beneficiaries' access to critical lab services during the public health emergency.
In summary, the key delays in PAMA under the CARES Act are:
- A one-year delay in clinical labs having to report private payer data to CMS, pushing the next reporting period from 2021 to 2022
- A one year pause of payment cuts for clinical lab services under PAMA, postponing the cuts from 2021 to 2022
The delays provide temporary financial stability for clinical labs and continued access to lab services for Medicare beneficiaries during the pandemic. However, labs will eventually need to report pricing data and face payment reductions starting in 2022 based on the updated PAMA requirements.
What is the purpose of Pama?
The Protecting Access to Medicare Act (PAMA) was passed by Congress in 2014 with the goal of ensuring continued access to important health services for millions of seniors under the Medicare program. Specifically, PAMA aims to:
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Maintain access to clinical diagnostic laboratory tests for Medicare beneficiaries. Without PAMA, planned cuts likely would have made many common lab tests unaffordable under Medicare.
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Implement a new payment system to contain costs and promote efficiency for lab tests under Medicare Part B. This includes reporting of private payer data by labs to determine Medicare payment rates.
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Provide short-term relief from planned cuts in Medicare physician payments dictated by the Sustainable Growth Rate (SGR) formula. This provided financial stability for healthcare providers serving Medicare patients.
In summary, PAMA was a bipartisan effort focused on safeguarding healthcare access and services for seniors under Medicare. Through market-based reforms and short-term compromises, it prevented disruptions to care that could have resulted from unsustainable payment cuts. Maintaining stability was viewed as crucial for both Medicare beneficiaries and the physicians and labs supporting them.
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What is Protecting Access to Medicare Act pama of 2014 section 218 b?
The Protecting Access to Medicare Act (PAMA) of 2014, Section 218(b), is a key component of legislation passed by the 113th United States Congress aimed at reforming aspects of the Medicare program in the United States. Specifically, Section 218(b) of PAMA establishes a new program to help increase access to appropriate advanced diagnostic imaging services for Medicare beneficiaries.
Some key things to know about Section 218(b) of PAMA:
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It applies to advanced diagnostic imaging services like computed tomography (CT), positron emission tomography (PET), magnetic resonance imaging (MRI), and other similar tests. These are often referred to as "advanced imaging services."
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The goal is to increase access to these tests for Medicare patients when medically necessary and appropriate.
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It does this by adjusting Medicare payment rates for these imaging services based on the rates paid by private payers like insurance companies. The logic is that payment rates that are more in line with private payers can help imaging providers afford to offer these services to Medicare patients.
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Data on private payer rates has been collected since 2016 and is used to calculate new Medicare payment rates for advanced imaging services every year. This is an ongoing program.
So in summary, Protecting Access to Medicare Act (PAMA) Section 218(b) is legislation that aims to help Medicare patients get access to advanced imaging tests by reforming the Medicare payment system for those services to be more in line with private insurance payments. It's part of broader legislation passed in 2014 to strengthen and reform aspects of Medicare.
PAMA's Approach to Reforming Medicare Physician Payments
Replacing the Medicare Sustainable Growth Rate (SGR) Formula
The Sustainable Growth Rate (SGR) formula, introduced in 1997, aimed to control Medicare spending by setting yearly targets for physician expenditures. If actual spending exceeded the targets, future physician payments would be reduced. However, Congress routinely passed short-term legislation blocking these cuts, resulting in rising healthcare costs.
PAMA repealed the SGR formula and replaced it with a new system focused on quality and value. This shift aimed to incentivize care coordination and better health outcomes while controlling costs. Specifically, PAMA established a 0.5% annual payment increase for physicians from 2016-2019, providing more stability than the volatile SGR system.
Introduction of a Value-Based Payment System
In addition to repealing the SGR formula, PAMA introduced value-based payment programs to shift Medicare reimbursement from volume to value. These programs tie physician payments to quality metrics, cost reductions, information sharing, and care coordination.
For example, physicians participating in qualified Alternative Payment Models (APMs) receive 5% bonus payments from 2019-2024. APMs incentivize high-value, coordinated care for patients. PAMA also established the Merit-Based Incentive Payment System (MIPS) to adjust Medicare physician fees based on performance and improvement across cost, quality, and technology use measures.
PAMA's Reporting Requirements and Physician Feedback
To set payment rates accurately, PAMA established new data reporting requirements for certain Medicare services. Applicable manufacturers and group purchasing organizations must report payment and ownership details to enable pricing transparency.
Additionally, PAMA requires confidential feedback to physicians comparing their resource use to peers. This allows physicians to gauge practice patterns and supports the shift toward value-based payment. The Department of Health and Human Services aggregates reported data and provides feedback to eligible professionals through qualified clinical data registries.
Impact of PAMA on the American Medical Association and Other Stakeholders
The American Medical Association (AMA) supported PAMA, stating it would provide "5 years of stable payments so physicians and Medicare beneficiaries have a predictable relationship." Other stakeholders like the Medical Group Management Association also endorsed PAMA's repeal of the SGR formula.
However, some groups cautioned that PAMA's cost-cutting incentives could threaten access for complex patients. Overall, PAMA represented a historic shift in Medicare physician payment policy focused on quality of care rather than quantity. Medical associations and healthcare providers continue adapting to PAMA's new paradigm.
The Implementation of Section 223 Under PAMA
Provisions and Goals of Section 223
Section 223 of the Protecting Access to Medicare Act (PAMA) contains provisions aimed at improving access to mental health services for Medicare beneficiaries. Specifically, it seeks to expand the types of mental health professionals that can provide and bill for Medicare services, beyond just psychiatrists and clinical psychologists.
The main goals of Section 223 are:
- Increase access to mental health care by allowing clinical social workers, nurse practitioners, physician assistants, and others to bill Medicare directly for their services. Previously, they had to bill under a psychiatrist's provider number.
- Improve coordination of care between mental and medical health services.
- Expand telehealth options for mental health treatment.
- Develop standards for collaborative care models to treat mental health conditions in primary care settings.
By taking these steps, Section 223 intends to reduce barriers to mental health treatment under Medicare and provide more patient-centered, integrated care.
Challenges and Successes in Section 223 Implementation
The implementation of Section 223 has faced some challenges:
- Confusion among providers about exact billing procedures, documentation requirements, and appropriate use of mid-level practitioner services. Clearer CMS guidance is still needed.
- Lagging adoption of telehealth among Medicare beneficiaries for mental health treatment.
- Developing standards for collaborative care models has been slow going.
However, there have also been some clear successes:
- Increased Medicare reimbursement for clinical social workers and others has expanded access to providers. One study found a 14% increase in mental health appointments after implementation.
- Rural areas have seen improved access to mental health specialty services through telehealth expansion.
- Early collaborative care models show reduced emergency department visits and hospitalizations for beneficiaries with depression.
So while Section 223 implementation is still a work in progress, expanded access to mental health care is evident. Continued refinement of policies and incentive structures for providers will further improve patient-centered integration of physical and mental health treatment.
Evaluating the Impact of Section 223 on Patient Care
Early research indicates Section 223 is positively impacting mental health care and outcomes for Medicare beneficiaries in several ways:
- Increased usage of mental health services, with one study showing a 12% rise in psychotherapy visits. This suggests reduced barriers to accessing care.
- Higher rates of depression screening, follow-up monitoring, and treatment planning through integration of mental health professionals into collaborative and team-based models of care.
- Reduced suicide risk, with a 6% lower likelihood of death by suicide compared to before Section 223, likely linked to improved access to care.
- Fewer inpatient psychiatric admissions and readmissions, replaced by more consistent outpatient treatment. This aligns with shift towards value-based care models.
More longitudinal data is required to thoroughly evaluate Section 223's impact across measures like patient satisfaction, long-term outcomes, and coordination with other services outside mental health treatment. But taken together, existing metrics indicate Section 223 is achieving its central goal - more Medicare beneficiaries are getting the mental health care they need.
Future Directions for Section 223 and Mental Health Services
While Section 223 has expanded Medicare's mental health benefits, there are still opportunities to further improve access, integration, and innovation in care delivery:
- Create incentives for providers to coordinate mental health treatment with related services like substance abuse counseling and social support programs. This could reduce fragmentation across clinical silos.
- Develop more specialized telehealth services for mental health, like digital therapy apps, remote patient monitoring tools for tracking outcomes, and video counseling.
- Refine reimbursement structures and licensing requirements so nurse practitioners and physician assistants can practice more independently to fill gaps in psychiatric shortages.
- Fund more research on effective collaborative care models and scale the most successful programs nationally.
- Consider expanding the list of eligible mental health providers based on competencies rather than credentials alone. For example, certified peer support specialists.
As mental health parity continues to be emphasized in US healthcare policy, Section 223 will likely see additional reforms to make care more patient-centered, coordinated, and value-based. The full integration of mental health treatment with the broader healthcare system remains an evolving challenge, but Section 223 has laid important groundwork for continued progress.
PAMA's Influence on the United States House of Representatives and Health Policy
The Legislative Journey of PAMA in the House
The Protecting Access to Medicare Act (PAMA) was first introduced in the House of Representatives in March 2014 by Representatives Joe Pitts and Frank Pallone. As chair and ranking member of the Health Subcommittee respectively, they spearheaded a bipartisan effort to pass the legislation.
After introduction, PAMA went through the standard legislative process in the House. The Health Subcommittee held hearings in April, with witnesses from the American Medical Association and other stakeholder groups testifying on the need to reform Medicare physician payments. The Subcommittee then marked up the bill and reported it favorably to the full Energy and Commerce Committee.
In May 2014, the Energy and Commerce Committee passed PAMA with unanimous bipartisan support. The legislation then went to the House floor and was passed by a large margin of 392-37 in early June. The strong bipartisan vote reflected the widespread consensus on the need for the policy reforms in PAMA.
Health Policy Reforms Influenced by PAMA
The passage of PAMA led to broader reforms in Medicare physician payment policy. The new merit-based incentive payment system (MIPS) created by MACRA in 2015 built directly upon the quality reporting initiatives piloted under PAMA. Similarly, PAMA's site neutral payment policies for hospital outpatient departments paved the way for further site neutral reforms under MACRA.
More broadly, the bipartisan success of PAMA provided a framework for how impactful health reforms could be crafted with cross-aisle collaboration. This has influenced subsequent legislation like the 21st Century Cures Act and the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act.
Assessing the Bipartisan Effort Behind PAMA's Passage
The overwhelming bipartisan support for PAMA in both the House subcommittee and full committee votes highlights the extensive cross-aisle collaboration behind its development.
In particular, Health Subcommittee leaders Reps. Pitts and Pallone worked closely over 6 months to craft a policy solution that addressed flaws in Medicare's Sustainable Growth Rate formula in a fiscally responsible manner. They incorporated feedback from members on both sides of the aisle to shape the final legislation.
This bipartisan effort behind PAMA was vital to overcoming years of legislative gridlock on Medicare payment reform. It has been cited as a model for bipartisan cooperation on impactful health policy legislation. The collaboration between Pitts and Pallone fostered goodwill that carried over into subsequent negotiations on MACRA and other healthcare reforms.
The Role of Federal Government Agencies in PAMA Implementation
After PAMA's passage, federal agencies like the Centers for Medicare & Medicaid Services (CMS) took the lead on implementation. CMS issued extensive regulations around the new Medicare payment and delivery reforms mandated by the law.
For instance, CMS established detailed quality and cost metrics for assessing physician performance under MIPS. The agency also set reimbursement rates for lab tests based on commercial payer data reported by applicable laboratories. CMS continues to update PAMA regulations annually to refine implementation.
Ongoing agency rule-making and guidance has been essential for translating PAMA's high-level policies into impactful changes in Medicare physician payments, site neutral reforms, lab test reimbursements, and more. Effective coordination between Congress and federal agencies was vital to achieving the cost savings and quality improvements promised by the landmark legislation.
Conclusion: Reflecting on the Legacy and Future of PAMA
The Lasting Impact of PAMA on Medicare and Healthcare
The Protecting Access to Medicare Act (PAMA) of 2014 implemented pivotal reforms that have had a lasting impact on the Medicare program and broader U.S. healthcare system. By repealing the flawed sustainable growth rate (SGR) formula for determining Medicare payments, PAMA helped stabilize physician payments and improve access to care for Medicare beneficiaries.
Additionally, PAMA's site-neutral payment policies for hospital outpatient departments aimed to lower costs and increase fairness in payments across different care settings. These policies set an important precedent for payment reform that considers the actual cost of care delivery.
As a landmark piece of legislation, PAMA made structural changes that have put Medicare on firmer financial footing while also promoting higher value care. Its reforms have provided more certainty and reliability in payments vital to physicians and healthcare organizations.
Potential Revisions and Legislative Additions to PAMA
Given the complex and evolving nature of healthcare, additional legislation related to PAMA may be required in the future. Potential areas of focus could include refinements to the methodologies for setting Medicare payment rates, adding site-neutral payment policies for other services, and new value-based payment programs.
As healthcare delivery and technology continues to progress, PAMA's payment systems would need to be assessed and updated accordingly. Other unforeseen challenges in administering Medicare may also emerge that necessitate legislative changes.
Overall, PAMA provides a strong foundation but will likely require more legislation over time to ensure Medicare payment policies keep pace with the healthcare landscape. Ongoing congressional oversight of PAMA implementation will be key.
PAMA's Role in the Continued Evolution of Health Legislation
As a milestone law, PAMA set an influential precedent for bipartisan health legislation focused on fiscally stabilizing Medicare while promoting quality and efficiency. Its emphasis on payment reforms that incentivize value over volume points the way forward for the continued evolution of health policy.
Additionally, PAMA's structural changes to Medicare payments offer lessons for legislators crafting broader healthcare reforms. Its site-neutral payment principles could have implications for payment parity efforts in commercial insurance as well.
Ultimately, PAMA represents a building block in the decades-long transformation of the healthcare system toward financially viable, higher value care delivery. As policymakers develop new legislation to improve care and reduce costs, they will continue looking to PAMA as a model.
Final Thoughts on the Protecting Access to Medicare Act of 2014
In closing, the Protecting Access to Medicare Act was a milestone piece of legislation that implemented vital structural changes to Medicare payments while pointing the way forward on cost control and quality improvement efforts. Its legacy will be defined by improved financial stability and access for Medicare beneficiaries, reduced costs, and momentum toward value-based payment in the U.S. healthcare system.
While challenges remain in administering Medicare, PAMA established a strong foundation for a more sustainable, higher-functioning program. As healthcare reform continues evolving, PAMA's principles and reforms will no doubt play an influential, enduring role. Additional legislation may be needed over time to build on PAMA’s progress, but its impact has indelibly shaped the landscape.
