AMA President Lazarus on SGR, Competition, Physician Happiness


October 23, 2012


At the recent Medical Group Management Association (MGMA) meeting in San Antonio, Texas, Medscape Business of Medicine Executive Editor Leslie Kane was able to get some time with Jeremy A. Lazarus, MD, President of the American Medical Association (AMA). Dr. Lazarus talked about some of the key issues affecting physicians.

Medscape: The future of the Sustainable Growth Rate (SGR) is a critical issue. This is a huge problem for physicians, although it seems that the public in general isn't very concerned. What do you think is going to happen?

Jeremy Lazarus, MD

Dr. Lazarus: The SGR is not only a problem for physicians. There is a reason it should be of concern to patients and consumers. Our information is that 1 out of every 4 seniors has trouble accessing a primary care physician because more physicians are not taking Medicare patients; and 1 in 5 physicians is limiting the number of Medicare patients they take.

The reason the SGR repeal hasn't had massive public impact as a crisis splash is that doctors haven't, as a whole, suddenly stopped taking Medicare patients; it's been a very slow and steady decrease.

But there has been bipartisan support to repeal the SGR. There are very few in Congress who don't support the repeal of the SGR.

Medscape: What do you see as a possible alternative to the SGR?

Dr. Lazarus: It could be lots of different things. It could be a system that pays incentives for better care at lower cost. It could involve paying for outcomes of care. It could be utilizing a number of different payment systems, including some kind of global payment. It could be a fee situation that would involve better coordinated care and lead to better outcomes.

The AMA recently delivered a letter to the Senate. We have agreed to some overarching principles that can form the basis for new federal policy on a transition from the SGR. We believe a new payment system should also be beneficial to physician practices of every size and specialty, and that there should be models for every type and size of practice. The method used in Denver might be very different from that in a small rural town.

We are asking for a transformational period of 5 years to experiment with different types of systems and find out what works. The challenge of finding an alternative to the SGR is small compared with the challenges of dealing with all the changes brought by the ACA.

Medscape: On a different note, regarding Accountable Care Organizations (ACOs) and new payment models, a small number of physicians have mentioned that with programs such as "shared savings" programs, there could be a temptation to withhold some care or undertreat in order for physicians or the organization to earn the financial bonus for coming in under budget. Of course, this was also the case with capitation. It's not a new issue. Do you think this is a potential problem?

Dr. Lazarus: Incentives should be tied to improving care and to measures that are on the way to improving outcomes. One could hypothesize that anything could be misused. I would hope that hospitals and organizations would choose a way to distribute payments that is ethical and leads to improving the care of patients.

Medscape: You've talked about how it's important for physicians to be happy in their work situations, whether they're employed or in a small or large practice.

Dr. Lazarus: Yes, this is part of our strategic plan. We are working with 25 practices of different sizes and shapes and finding out what factors make the lives of physicians fulfilling and satisfying. It might be the infrastructure, it might be team-based training. But they are trying to develop models and templates for physicians so that doctors can look at them to decide what's going to be best for them.

Many physicians are probably going to stay in fee-for-service, and some will be in small practices. We want to give them the tools they will need to maintain the type of practice they want.

Medscape: Do you think that what makes younger physicians happy is different from what makes older physicians happy?

Dr. Lazarus: Probably. Younger physicians are looking more toward employment by a hospital, rather than working in a group. Younger physicians have more healthy ideas about a balance in their life or working more effectively in the hours they choose. They're more willing to take a salaried position, especially if they're coming out of medical school with a large debt.

For older physicians who are used to a particular way of practice, it's probably more problematic. Many of them are being forced to adapt to a system they hadn't chosen.

Medscape: There are some groups or individuals who have said that they need more alternatives to the AMA. How do you feel about potential competition with the AMA?

Dr. Lazarus: We are the largest physician organization and we play the largest leadership role for the physician community. Officials in Washington, DC, and others in government look to the AMA to represent physicians. We think we are a credible source for physicians. We do represent the vast majority of physicians.

We also provide information to state organizations and specialties. For specialists, their organizations are also probably very useful to them, and state organizations also. But we provide tools that physicians can use for a variety of issues. Everyone is entitled to their opinion, and competition is fine.

Medscape: Is there a particular message you'd like to give to doctors?

Dr. Lazarus: We recognize that there are different models of practice. And payment models are also changing. It is also a time of opportunity. The Centers for Medicare & Medicaid Services have the Center for Innovation, which is experimenting with many possible new models and solutions. There is a lot of potential. The AMA has many resources to help physicians decide what are the right models and situations for them.