Patients, doctors cope with Medicare meltdown

Janie Berry couldn't wait to move from Nevada back to her hometown of Yakima, where she has fond memories of growing up in an orchard and learning to drive a tractor.

But over the last few months, Berry, 76, hasn't been able to find a doctor to take her as a regular patient because she has only Medicare, the federal health insurance program for people 65 and older.

"When you get to my age, the one thing you want and need is a doctor," said Berry, who has high blood pressure and diabetes.

Berry and others like her have run smack into a national Medicare reimbursement crisis that Congress can't seem to fix and that is particularly acute in the Yakima Valley, where a chronic shortage of physicians already limits access to care.

As a July 1 deadline approached for a 10.6 percent automatic cut in Medicare payments to doctors, more and more physicians in Yakima County decided to limit or stop the number of new Medicare patients they could accept. Also affected are military families covered by a plan called Tricare, which is linked to Medicare for reimbursement.

The deadline came and went without a congressional solution because Republicans and Democrats are deeply divided over the future of Medicare, which has been hobbled by underfunding and faces an aging baby boomer population that will be seeking coverage.

Last week, President Bush delayed the pay cut until the middle of this month, hoping Congress will take action. In the meantime, the government has stopped processing Medicare claims, which means doctors aren't getting paid.

"This is a time of high anxiety," said Dr. Wendy Eider, a Yakima rheumatologist who has temporarily stopped seeing Medicare patients until the problem is resolved.

Yakima doctors have to cap the number of Medicare patients they see or face closing down and leaving town, said Don Bolin, chief executive officer of Medical Associates of Yakima, which offers centralized business services to its member clinics.

"It's an economic issue," Bolin said.

Dr. Roy Gondo made a medical analogy. "The bleeding we have been experiencing is now a hemorrhage," he said.

Doctors have complained for years that Medicare rates haven't kept pace with costs, such as new technology and the added paperwork required by insurance companies. The formula for determining reimbursement rates has basically been unchanged since Medicare was created in the 1960s, said Gondo.

Medicare reimburses doctors for about 46 percent of their fees while private insurance pays from 60 to 65 percent, said Dr. Timothy Melhorn, medical director at Cornerstone Medical Clinic, which is owned by Yakima Valley Memorial Hospital.

Medical practices incurred a 7 percent increase in operating costs in 2005, but Medicare reimbursed doctors less than half that amount, according to the Medical Group Management Association, which advocates for medical practice managers.

The association calculates that if Congress doesn't act to provide more funding, physicians will be paid at a rate lower than in 1999 while their costs have jumped 43 percent since that time.

Unless a doctor swallows the costs, the inevitable outcome is to shift them onto patients with private insurance and their employers who provide the coverage. Doctors already have been upping the volume of private-pay patients they see to try to make up the difference, but Melhorn said that's a game of diminishing returns.

Here in the Valley, there's no exact count of patients relying only on Medicare -- they have no supplemental insurance -- but Dr. David Krueger, president of the Yakima County Medical Society, said he believes many are ending up at one of the three federally subsidized low-income clinics in town that are required to accept Medicare.

Others are going straight to hospital emergency rooms, long the destination of the uninsured or those on Medicaid, the federal program for low-income people.

"The ERs used to be just Medicaid clinics, now they're turning into Medicare clinics," said Rick Linneweh, chief executive of Memorial Hospital.

Another indicator of the problem is pent-up demand at Cornerstone. Some 1,400 new Medicare patients contacted Cornerstone over a recent six-month period for services, but the clinic only had room for 112 of them. Memorial, a nonprofit, picks up the cost of whatever Medicare doesn't cover.

Medicare funding is loaded with politics and heavy lobbying by powerful interests that want a piece of the program. Democrats are taking aim at the Republican-created Medicare Advantage program, which are souped-up Medicare plans sold to seniors by private insurance carriers. Congress created the program as part of the 2003 Medicare drug-plan legislation.

Republicans defend Medicare Advantage, saying it allows patients to choose their personalized mix of benefits from private insurers who then bill Medicare. But Democrats say those payments to private insurers amount to a generous taxpayer subsidy to a profitable industry and they want the money to go directly into Medicare.

Bush has vowed to veto any cuts in Medicare Advantage, setting the stage for a drawn-out fight.

The next steps are unclear. After Republicans in the Senate blocked the vote to stop the looming 10.6 percent rate cut, Congress adjourned for the Fourth of July. As they returned this week, the American Medical Association blasted them in television and radio ads.

"Congress had six months to effectively address harsh Medicare cuts that will harm seniors' access to care," AMA President Dr. Nancy Nielsen said in a news release. "Despite broad bipartisan support in the House of Representatives for legislation to stop the Medicare cuts, action was stymied by 39 senators."

If history is any indication, a fix may only be temporary. In 2006, when a similar situation occurred, Congress took six months to cobble together a compromise. In fact, the battle over reimbursement rates has come to the brink every July for the last five years as Congress wrestles with what experts agree is an obsolete, and complicated, Medicare reimbursement formula.

For Medicare patients like Berry, the future is scary. After using the emergency room a few times and trying, without success, some of the brand new clinics in the West Valley, Berry ended up getting the care she needed at Yakima Neighborhood Health Services.

But it can be difficult to see the same doctor all the time at the sliding-scale clinics, and that's what Medicare patients, who tend to have multiple ailments and medications, really want: someone who knows all their history.

"I've never lived in a town where it's so hard to find a doctor," Berry said.

* Information from the Associated Press was included in this report.

* Leah Beth Ward can be reached at 577-7626 or lward@yakimaherald.com.

In search of a Medicare fix

* The federal health program for some 40 million older and disabled Americans continues to exceed spending goals, which kicks in a formula that lowers payments to some 600,000 doctors who treat them.

* A scheduled 10.6 percent rate cut that was to have taken place July 1 has been temporarily suspended. But doctors face another 5 percent cut next year.

* Experts agree the Medicare funding formula is faulty, but Congress hasn't been able to agree on a permanent fix.

Roll Call

* Rep. Doc Hastings, R-Pasco, voted for legislation to stop the Medicare rate cut. The House passed the bill 355-59.

* Democratic Sens. Patty Murray and Maria Cantwell also voted to proceed with a full vote to stop the cut, but the Senate fell one vote short of the 60 needed to proceed.

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