July 11, 2012 — WASHINGTON — AMA President-elect Ardis Dee Hoven, M.D., testified before the Senate Finance Committee today on the need to eliminate the Medicare physician payment formula and replace it with a viable system that will support high-quality, high-value care for patients.

“We are very pleased that there is bipartisan discussion of how to eliminate this failed system of the past that discourages physician practice innovations and leaves Medicare patients at risk of facing access to care problems,” Dr. Hoven said. “We now have a unique opportunity to improve and restructure care delivery and payment policy. Restructuring our Medicare payment and delivery system is an enormous undertaking that requires initial immediate steps that can advance us further down the road, combined with a long-term strategy that takes us to the finish line.”

“Medicare payments have already been nearly frozen for a decade while the cost of caring for patients has increased by more than 20 percent,” Dr. Hoven said. “The longer lawmakers wait to address this issue, the larger the problem becomes.”

“The AMA shared with the Senate Finance Committee a path forward that will pave the way for innovations to improve the health care system and promote increased care coordination and quality while addressing rising costs,” Dr. Hoven said. “The first step is to start with a clean slate by permanently eliminating the failed Medicare physician payment formula. Congress should then provide a transition period that allows physicians to adopt new health information technology and practice strategies that will let them participate successfully in new care delivery models. The ultimate goal should be to transform the current Medicare system to one with multiple, proven care delivery models that reward high-quality care, rather than the current one size fits all formula.”

Dr. Hoven also submitted in-depth written testimony to the Committee. The AMA recently shared similar information with the House Ways and Means Committee in response to their request.