Peter W. Carmel, MD, president of the American Medical Association (AMA)

CHICAGO–The Patient Protection and Affordable Care Act (PPACA) is midway through its second year, and its impact is mixed, said Peter W. Carmel, MD, president of the American Medical Association and chair of neurosurgery at New Jersey Medical School in Newark, during the Pendergrass New Horizons Lecture on Nov. 28 at the 97th Scientific Assembly and Annual Meeting of the Radiological Society of North America (RSNA).

As nations globally search for ways to make the healthcare systems more effective, more efficient and less costly, the U.S. is in the midst of historic change, said Carmel. “PPACA outlined an ambitious plan to increase access, reform insurance industry practices, improve quality and invest in prevention all while reducing costs.”

In year two, there is some good news, largely in terms of patients. Insurers can no longer deny care based on pre-existing condition, youth under the age of 26 can remain on parents’ policies and co-payments have been eliminated for most preventive services. Plus, insurers must spend 80 percent of premium dollars on healthcare.

“PPACA is an historic victory, but like so many victories, it is imperfect,” said Carmel. “Serious challenges remain.”

Most importantly, according to Carmel, PPACA failed to repeal the sustainable growth rate formula (SGR). More recently, the Joint Select Committee on Deficit Reduction, commonly referred to as the Supercommittee had "a golden opportunity to protect Medicare for future generations of seniors and they blew it.”

In addition to triggering $1.2 trillion in deficit reduction measures beginning in 2013, sequestration also includes a “meat cleaver” cut of 2 percent to Medicare providers. However, whether or not sequestration will actually occur remains to be seen.

Still, Congress must attend to unfinished business. Carmel explained that leaders in both parties have affirmed their commitment to repealing the SGR. It may be another short-term action or (possibly) a long-term solution. “The bottom line is that it is impossible for this nation to climb out of its fiscal hole if we don’t address the broken Medicare system,” said Carmel, noting that the costs of repealing the SGR have risen from $48 billion in 2005 to $300 billion this year and a projected $600 billion in 2016.

“The ongoing threat of SGR cuts stands in way of health system reform,” said Carmel.

Other challenges also remain. For example, PPACA did not fix the medical liability system. Carmel offered H.R. 5, the Health Act, as a remedy. Modeled after successful programs in California and Texas, the act would cap economic damages at $250,000 and discourage frivolous suits, he said.

The AMA also is discouraging the formation of the proposed independent payment advisory board, which could initiate additional cuts to Medicare providers if projected spending targets are exceeded.

Carmel likened the situation to triple jeopardy, and then outlined a few AMA victories. These include:

• The revision of final rules for ACOs to allow participating physicians to share in first dollar savings;
• Significant modifications to e-prescribing penalty programs; and
• Introduction of the Medicare Patient Empowerment Act in the House of Representatives and the Senate.

The AMA also worked with the American College of Radiology to block a planned $400 million in new Medicare cuts to imaging services and opposed the Medicare Payment Advisory Commission recommendation to extend the multiple procedure payment reduction (MPPR) to the professional component of imaging exams.

The Centers for Medicare & Medicaid Services blinked and reduced MPPR cuts from 50 to 25 percent. “Our work on this critical issue is not over. When physicians stand together in a united front, we can have a profound impact,” Carmel concluded.