Community Commentary: American Medical Assn. losing its credibility, membership

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Sally Pipes, president of the Pacific Research Institute, has written an important article in Forbes analyzing new survey results that demonstrate that 87% of medical physicians in the United States no longer view the American Medical Assn. as representing their views and interests.

"Much of that dissatisfaction stems from the organization's support for President Obama's contentious health care reform package," Pipes states.

The survey, conducted by physician recruitment firm Jackson & Coker, discovered that more than three times as many doctors believed that the quality of American health care would "deteriorate" rather than "improve" under ObamaCare; and 9 of 10 physicians think ObamaCare will have a negative impact on their profession.

Most member-driven organizations would collapse with such negative trends, but the AMA survives by collecting up to $70 million from its exclusive relationship with the federal government to provide Current Procedural Terminology (CPT) codes in direct conflict with medical doctors.

The CPT codes are maintained by the Chicago-based AMA to describe medical, surgical and diagnostic services. It is designed to communicate a uniform set of information about medical services and procedures to physicians, patients, accreditation organizations and payers for administrative, financial and Medicare and Medicaid billing coders.

These codes have been designated by the U.S. Department of Health & Human Services to be published for treatment guidelines and billings.

Federal and state spending on healthcare is $1.1 trillion, about 42% of all healthcare spending in the U.S. last year. CPT codes set average physician and hospital reimbursement rates.

For example, the average physician rates for treating Medicare beneficiaries is 81% of the rate private insurers pay. For Medicaid patients, the reimbursements are just 56% of the private rate.

AMA 2009 revenue, according to "Hoover's Company Profiles," was $248 million, with $70 million of income coming from "publishing." This is an especially large percentage of revenue, considering that the AMA membership dues were only $42 million.

The AMA is adamant that this publishing involves more than 100 books, but the AMA refuses to break out which part is not CPT-code related. The sensitivity to full disclosure of CPT revenue is further heightened by the May 2009 announcement that 100 members of AMA's 1,200 member staff would be laid off, presumably due to falling membership dues.

On July 16, 2009, the AMA shocked the physician community by publicly endorsing the House Healthcare Reform Bill, which was passed on March 23, 2010, as the Patient Protection and Affordable Care Act. Nicknamed ObamaCare, the law conveniently maintained the AMA's monopoly on CPT billing codes.

Dr. Daniel Palestrant, founder of SERMO, the largest online exclusive physician's network, summed up medical doctor frustration with the AMA: "With estimates ranging that 15% to 40% of each healthcare dollar spent going towards administration overhead, and administrative overhead and physicians largely blaming CPT codes for this problem, one has to wonder why this has remained conspicuously out of the debate."

Dr. Palestrant continues: "In the healthcare debate, it is rare that we find a single issue that all parties can agree is a big part of the problem. Too much paperwork and complexity in the billing process is one of those few things. … For most physicians, Current Procedure Terminology, or CPT codes, have become a defining aspect of how we must practice medicine.

"They have become the 'currency' of healthcare, mandating all manner of payments to physicians from the most complex surgical procedures to routine office visits. In the process, the CPT coding system has turned into an incredibly complex system of codes, modifiers, and exceptions."

ObamaCare was sold to the public as good medicine, based on the strident support of the American Medical Assn. Given the crumbling AMA membership, the preservation of CPT coding system in ObamaCare represents the ultimate collusion of convenience between the business side of the AMA at the expense of physicians and patients.

CHRISS STREET is the former Orange County treasurer-tax collector and a Newport Beach resident. His latest book, "The Third Way," will be published Oct. 15.

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