At a Crossroads: The AMA and Health Care Reform.
As Ronald Reagan was transitioning from Gipper to Governor, he had a short-lived career as a recording artist. Unlike some of his later Hollywood contemporaries, like Kevin Bacon, Steven Seagal, Jennifer Lopez, and William Shatner, Reagan’s recording career was for a very limited and specific purpose.
Simply put, he was frightened at the prospect of socialism in America and he was determined to do something about it.
So, in 1961, three years before his star-turn at the 1964 GOP National Convention, Reagan teamed up with the American Medical Association to record an album denouncing a proposed bill that would provide compulsory medical care to senior citizens in the United States. That bill, the Social Security Act of 1965, proposed to create Medicare and Medicaid.
In “Ronald Reagan Speaks Out Against Socialized Medicine,” the well-known actor gave a ten-minute speech about the dangers of allowing the government too much control over health care, noting that “[o]ne of the traditional methods of imposing statism or socialism on a people has been by way of medicine.” Reagan warned that socialized medicine was only the tip of the iceberg. Pretty soon, the government would decide your means of employment, your salary, and what school your kids could go to. Reagan then encouraged his listeners to oppose the bill, otherwise “one of these days you and I are going to spend our sunset years telling our children, and our children’s children, what it once was like in America when men were free.” The record wasn’t enough to derail the bill, but established the AMA as one of the most well-organized and powerful lobbying groups in the United States.
The AMA continued its crusade against governmental intervention into health care over the next several decades. It has opposed every significant health care reform attempt from Truman’s call for universal health care to HillaryCare nearly five decades later, all under the auspices of preventing socialized medicine. In doing so, the AMA, buoyed by its status as the largest association of doctors and medical students in the United States, became a powerful, and consistently conservative voice on Capitol Hill.
However, in recent years, the AMA has seemingly turned its back on the Republicans that it used to support and depend on for votes, and has contributed, instead, to Democrats. With several high-profile announcements over the last few months, the AMA has, seemingly, cemented its shift to the left. The AMA supported the health care reform bill that recently passed the House, encouraged the military to drop it’s “Don’t Ask, Don’t Tell” policy, and recommended that the federal government reevaluate its classification of marijuana as a controlled substance.
The AMA, however, has resisted these ideological labels and maintained that it has always been in favor of increased access to health care. However, as the Senate starts to consider health care reform, the AMA finds itself at a crossroads. Its membership is declining and its political power is diminishing. Worse, its message is becoming increasingly fractured as different factions are trying to pull the AMA in different directions. By angling for a seat at the bargaining table instead of playing the obstructionist role that it had become accustomed to, the AMA had hoped to shape the bill on its terms. Now, it faces accusations of selling out and betraying the fundamental principles of the organization.
The AMA: Pro-Health Care Reform or Pro-Medicare Reform?
It’s easy to get lost in the mundane, especially when parliamentary procedure is involved. But a key cloture vote on October 21, 2009 helped illustrate the AMA’s dwindling political power. The Senate failed to cut off debate and move to a vote on S. 1776, effectively killing a bill that would have prevented a 21 percent cut in Medicare payments to physicians by fixing a reimbursement formula that many doctors consider fundamentally and fatally flawed. In fact, the Democrats couldn’t even muster a bare majority, let alone the requisite 60 votes, losing by a 47-53 margin. An angry Senator Harry Reid, D-N.V., later blamed the AMA, which had lobbied heavily on behalf of the bill, claiming that he had been misled by the group into thinking he had significant GOP support.
“We were told by the American Medical Association and others, that we would get help by the Republicans to take care of senior citizens so they could have doctors to take care of them,” Reid said on the floor of the Senate. “I want everyone here to know, we’re going to take care of Medicare. If the Republicans here in the Senate don’t want to do it the way we’ve done it in the past by doing this doctors’ fix, then we will, when we finish the health care legislation, we’ll come back and we’ll take care of a multiple-year fix for the doctors and senior citizens.”
The AMA’s defeat was a rare one for the once-powerful group, but one that showed its decreased political standing. During its heyday in the 1970s, the AMA counted nearly three-fourths of the nation’s physicians as members. That number has steadily decreased to the point that the AMA only represents approximately 20 percent of practicing physicians today. Nevertheless, the AMA is still the largest professional society for doctors and med students in the United States. In 2008, the AMA reported its membership to be approximately 236,000 physicians and med students. According to the AMA’s online physician locator, which provides contact information for “virtually every licensed physician in the United States,” there are over 814,000 physicians practicing in the United States.
The AMA has used its size and influence, and most importantly, its money, to become an important player on Capitol Hill. The AMA has spent over $30 million in lobbying since 2008, and has spent $12.6 million through the first nine months of 2009, according to Opensecrets.org.
However, its stance on health care reform has taken a circuitous and often confusing route.
On November 5, two days before the House vote on H.R. 3962, the Affordable Health Care for America Act, the AMA expressed support for the bill, which included a public option. In early June, the New York Times reported that the AMA had warned Congress that it would oppose the public option, only to backtrack later in the day. “The AMA opposes any public plan that forces physicians to participate, expands the fiscally-challenged Medicare program or pays Medicare rates, but the AMA is willing to consider other variations of a public plan that are currently under discussion in Congress,” said Dr. Nancy Nielsen, then-president of the AMA, in a written statement.
Their eleventh-hour support for the House bill gave President Obama a huge boost just days after the Democrats lost gubernatorial races in New Jersey and Virginia. In his statement of support, Dr. James Rohack, president of the AMA, stated that the bill was “consistent with our principles of pluralism, freedom of choice, freedom of physician practice and universal access.” Rohack admitted that the bill was not perfect, however he argued that the bill “goes a long way toward expanding access to high-quality affordable health coverage for all Americans, and it would make the system better for patients and physicians.”
How is it that the AMA, one of the biggest roadblocks to health care reform over the past few decades, came to support a bill that, according to its detractors, is but a pretense for an eventual full-fledged governmental takeover of health care?
The answer to that question could very well lie with the bill that started the AMA’s fight against socialized medicine: Medicare. In the second part of Dr. Rohack’s letter, he also expressed support for H.R. 3961, the Medicare Physician Payment Reform Act of 2009. The bill, which passed the House on November 19, would prevent a 21 percent cut in physician payment rates, and most importantly, replace the Sustainable Growth Rate (SGR) formula, which currently determines how Medicare is funded.
The SGR formula, which was passed in 1997, was an attempt by Congress to control the ballooning costs of Medicare. The SGR determined, essentially, that Medicare’s funding would depend on the gross domestic product, meaning that Medicare could not grow faster than the country’s economy. According to a 2009 study by the Kaiser Family Foundation and Health Research & Educational Trust, the costs of health care have far exceeded the rate of inflation, indeed the prices of premiums have increased by 131 percent since 1999 while inflation has only been 28 percent in that time span. As a result, the SGR formula already amounts to a cut even before factoring in increases or decreases in GDP.
The AMA has been at the forefront of the effort to stop the bleeding of Medicare payments to physicians. Since 2002, Congress has passed stopgap measures every year to prevent cuts in Medicare payments to physicians. In December 2007, Congress stepped in and passed a bill that prevented a projected 10 percent cut in payments. In June 2008, the AMA’s intense lobbying efforts paid off as Congress overrode President Bush’s veto and overwhelmingly voted to extend the bill to cover the rest of 2008 and all of 2009. While the AMA was pleased that Congress made sure that doctors would continue receiving their money, it was disappointed that Congress failed to permanently solve the problem.
“Seven times in the last seven years, Congress has passed legislation to over-ride the SGR formula. In essence, Congress has been operating with an artificial budget baseline for Medicare physician spending…” Michael Mayes, Vice President of the AMA, wrote in a letter to Senator Reid. “Those who are concerned about waiving budget requirements should recognize that the past practice of ‘temporary band-aids’ on the SGR problem has only served to increase both the size of future cuts and the cost of subsequent interventions.”
Based on projections from the Congressional Budget Office, Medicare cuts would be 25 percent or more in 2011. “There have been no updates to physician rates since the SGR came in, it’s just been kept stable by that yearly fix,” said Dr. Josh Cohen, a headache specialist and ten-year AMA member who practices at St. Luke’s Roosevelt Hospital in New York. “Doctors end up breaking even, so any cut that could potentially happen could make it a losing proposition to see those patients, and smaller practices couldn’t afford to do so. There have been some estimates that if a cut like this went through then somewhere between 40-60 percent of physicians who see Medicare patients would no longer be able to do so. That would have a disastrous effects for our country’s seniors who are relying on Medicare to have access to physicians.”
The AMA has certainly put its money where its mouth is. According to OpenSecrets.org, PACS and/or individuals affiliated with the AMA donated nearly $1.9 million during the 2008 election cycle with 56 percent going to Democrats. This is a stark reversal from their contributions in 2004 and 2006, when 76 percent and 67 percent of those contributions went to the Republicans, respectively.
A look at their donation pattern for the 2010 cycle is more illuminating. In the House, the top recipients have been Representatives Judy Chu, D-C.A., Michael Burgess, R-T.X., and Harry Teague, D-N.M., all of who have received $5,000. Chu voted for the House bill while Burgess and Teague did not. However, all three voted for the recent Medicare reform bill. In fact, Burgess, a medical doctor, was the only Republican to break ranks with the party and vote for the bill.
“[I]t is very unlikely that today’s bill will ever become law, since the Senate has already soundly rejected a similar plan,” Burgess, a long-time proponent of fixing the SGR, explained in a press release. “Because of this, today’s vote is largely symbolic, and with my ‘yes’ vote, I stand committed to America’s doctors, the millions of seniors they care for, and TRICARE recipients, to fix this problem.”
In the Senate, the leader of the pack has been Chuck Schumer, D-N.Y., who has been one of the most outspoken supporters of a public option. Schumer has received $5,000 while the other top recipients of money from AMA affiliated individuals or organizations are Charles Grassley, R-I.A., Barbara Boxer, D-C.A., Blanche Lincoln, D-A.R., Kirsten Gillibrand, D-N.Y., Robert Menendez, D-N.J., Patty Murray, D-W.A., and Debbie Stabenow, D-M.I. All but Grassley voted for cloture on S. 1776 in October.
To the AMA, this is not an ideological issue. Simply put, the AMA believes it is impossible to have meaningful health care reform without fixing Medicare. “You’d basically be stealing from one system to pay for another,” said Cohen. “If you end up covering 40 million under a new plan that you create, but suddenly, 40 million seniors have no access to care because their doctors drop out of Medicare, then you really haven’t accomplished anything.”
The AMA has disputed claims that it is moving towards the left. “The AMA is a bipartisan organization and represents physicians who often disagree greatly on politics, but agree on health related policy,” said Kristina Maletz in an email, a medical student at Columbia University and an AMA member. “I see people claim that the AMA swings to the far right, and those that say it swings to the far left. My only conclusion from this is perhaps the AMA representation just as it was intended: representing the will of the house of medicine.”
Cohen, a life-long Democrat, agrees with this assessment, pointing out that the AMA is a diverse body that encourages people from all over the political spectrum to join. He also dismisses the idea that the group is becoming more liberal, stating that the AMA’s political donations depend on its priorities. “In the early 90s, there was a lot of attention on a Patients’ Bill of Rights. As a result there was more political affiliation along those lines and physicians supported that. In late 90s there was more focus on liability reform, which was being undertaken by Republicans,” said Cohen.
Cohen also points out that the AMA’s recent announcements regarding marijuana and “Don’t Ask, Don’t Tell,” are based, purely, on medical concerns. “The ‘Don’t Ask Don’t Tell’ policy interferes with patient confidentiality as patients cannot discuss important health matters related to their sexual orientation with physicians in the military for fear of job loss,” said Cohen. “On the issue of marijuana, many doctors believe there may be medical uses of marijuana or THC, but the current scheduling of marijuana as Schedule 1 prevents research to determine whether or not marijuana has any medical applications.”
Not everyone is buying it. According to “The Decline of the AMA,” Jeff Carlisle wrote that, as early as 2001, there were already concerns over the AMA’s leftward tilt. In 1998, the AMA threw its weight against a Washington state ballot initiative to ban racial preference programs. In 2001, the AMA criticized the Boy Scouts of America for their policy banning homosexuals from serving as scoutmasters, asserting that such actions can lead to greater suicide rates. Later that year, then-president of the AMA Richard Corlin gave a speech calling for stricter gun control.
The AMA’s support of the House bill touched off some internal strife within the organization, as a group of doctors introduced a resolution rescinding the AMA’s support at last month’s meeting of the AMA’s House of Delegates in Houston. The resolution failed overwhelmingly, and according to Cohen, who was present at the meeting, the disagreement was based more in misunderstanding and miscommunication than in any deep-seated ideological divide. “Every day I get updates from AMA, but not all physicians receive these emails. As a result, there’s a lack of knowledge and understanding as to why the AMA is doing what they’re doing,” Cohen explained. “The great thing about this meeting was that the AMA was able to explain all that to those members who hadn’t been following the process, and they understood why AMA is doing what it’s doing.”
The divisions within the AMA also highlight the fact that many groups within the medical community have openly split with them. The American College of Surgeons and the American Society of Cataract and Refractive Surgery have both come out against the Senate bill, taking issue, in particular, to the proposed Medicare Advisory Board, and excise taxes on elective cosmetic surgery. The state medical associations of California, Texas, and Florida have also expressed their opposition to the bill as it’s currently written.
However, the most vociferous criticism has come from the Association of American Physicians and Surgeons (AAPS). The conservative organization has been linked with the Tea Party movement and boasts Ron Paul as a member. In September, after the AMA expressed support for a predecessor of H.R. 3962, over 1,000 members of the AAPS picketed the AMA’s office building in Washington D.C. When the AMA supported H.R. 3962, the AAPS picketed the AMA meeting in Houston. Their website encourages doctors to resign from the AMA, and their front page contains links to photos and videos from their AMA protests. “The AMA has sold out patients, and sold out the profession of medicine for a few dollars of Medicare money,” said Kathleen Serkes, Director of Policy and Public Affairs, in a press release.
The AMA has also taken criticism from the left. The Physicians for a National Health Plan (PNHP), which advocates advocate for a single-payer system, has accused the AMA of being in bed with the pharmaceutical industry. “[The] AMA derives substantial funding from the pharmaceutical industry and its politics should be understood in that context,” said Dr. Laura Boylan, PNHP member and professor at NYU Medical School, in an email. “One single source of pharma funding alone, the sale of individual physician identification info, accounts for 16% of all AMA revenue sources.”
Indeed, according to the New England Journal of Medicine, in 2005, the AMA earned $44.5 million in revenue from the sale of doctors’ prescription information and history to pharmaceutical companies, which accounted for 16% of the AMA’s total revenue. In 2007, the AMA stated that they would allow doctors to withhold their information from the prescription information database, but continued to tout the benefits of inclusion, such as conducting medical research, setting up clinical trials, facilitating drug recalls.
Like the AMA, the pharmaceutical industry supports Obama’s health care reform efforts. In August, the big pharmaceutical companies cut a deal with the White House to support the bill in exchange for a pledge by the government not to use its leverage to negotiate lower prices for drugs. The AMA, for its part, adamantly denied any quid pro quo with the White House. According to an AMA spokesperson, the AMA spoke with both sides of the aisle on a variety of matters, including prescription drugs, but ultimately made their decision because they reviewed the bill and deliberated on it.
Ultimately, the AMA’s ever-changing role in the health care reform saga could take yet another turn. The AMA has not ruled out pulling its support for the bill if the Medicare payment fix fails to pass the Senate. “In supporting 3962, the AMA made it clear that the final bill needs to address certain things that were not in 3962. If 3961 fails, then it is conceivable that the AMA would be in a position where they could no longer support the bill because of the detriment to our nation’s patients and the potential that, instead of increasing access to health care, we could be decreasing it,” said Cohen.
Meanwhile, the irony of the fact that the AMA is now advocating for a program they once demonized as the first step towards Communism hasn’t been lost on them. A spokesperson for the AMA reflected on this phenomenon, saying that times have changed and that Medicare has been around for so long that millions of seniors rely and depend on it. As such, it doesn’t make much sense to abandon it, and if anything, Medicare has to be strong in order to suit the needs of its patients.
Cohen adds that he doesn’t see the AMA’s embrace of Medicare to be inconsistent with its core principles. “It’s like with the public option. People get very concerned about a plan that’s at the disposition of budgetary realities and what that can mean for the program down the road,” said Cohen. “Medicare started out as an adequately funded program but now is woefully underfunded. Whatever system is created has be appropriately funded, that it’s sustainable, and will increase access to care.”