January 1997 Bulletin

Academy to ask Congress to ban HCFA's 'excellence' term; Mayo's orthopaedists won't participate

The Academy will ask Congress to prevent the Health Care Financing Administration (HCFA) from using the term "participating centers of excellence" for its demonstration project for orthopaedic and cardiovascular services.

The action comes as hospitals across the country consider whether they will accept HCFA's invitation to submit final application forms. The department of orthopaedic surgery at Mayo Clinic, Rochester, Minn., has rejected an invitation to apply for participation in the program, said Bernard F. Morrey, MD, department chairman.

"HCFA's final application form made it crystal clear that the primary focus of HCFA is discounts," Dr. Morrey said. "In no appreciable way does the process encourage or reward quality service. HCFA only wants to discount further what, in our opinion, is already being discounted in a manner that compromises patient care."

The program requires hospitals to negotiate one price, covering all costs from administration to surgical fees, for total hip and knee replacements for Medicare patients.

Mayo was one of 152 institutions notified on Dec. 20, 1996 that it had been selected for consideration to participate. There were 84 institutions for orthopaedic services and 68 for cardiovascular services. They were among 533 hospitals in 10 midwest and far west states that submitted pre-applications in March 1996.

Academy executive vice president William W. Tipton Jr., MD, said the "Academy is not opposed to demonstration projects that attempt to provide quality, cost-effective service, but the Academy is opposed to this program which addresses cost without concern for quality service to patients.

"The Academy is strongly opposed to the use of the term 'participating centers of excellence' because it is a marketing ploy that will mislead patients into believing these are the only hospitals that can provide quality service. This is not true."

The American Medical Association also has approved a resolution opposing the use of the term.

Dr. Morrey, who also is the 1994 Academy president, said that "in spite of reduced costs of joint implants, putting patients on critical pathways and reducing the cost for surgery, it would not be possible for us to participate in a program that required any further discounts.

"HCFA's application made it clear that if you don't show a discount in costs, don't apply. It appears to only pay lip service to quality."

Dr. Morrey also pointed out that Mayo's orthopaedic service performs a high percentage of joint reoperations. "The reimbursement for a reoperation is at the same rate as the primary operation, despite the fact that the cost of the implants are higher, the operating time is longer, the in-hospital stay is longer and the complication rate is higher. Mayo's revision practice is increasing and the negative reimbursement is becoming prohibitive. Unfortunately, HCFA has missed or ignored the opportunity to rectify this inequity which ultimately will have a severe negative impact on patient care and access."

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