2009 Legislative Agenda

DOoctor’s
rders
TMA’s Prescription
for a Healthy Texas
IFC
 Doctor’s Orders:
TMA Prescription for a Healthy Texas
2009 Legislative Agenda

In emergency medical situations, seconds count.

For health care and health insurance reform challenges facing the
81st Texas Legislature, our time also is short.

Our patients no longer understand nor can they navigate today’s

complicated health care system. Our patients are afraid they can’t get
Josie R. Williams, MD or even afford the care they need. Our patients believe our health care
system is broken.
Texas state leaders and legislators have the power to fix our broken health care system. As you
arrive in Austin for the 2009 Texas Legislature, we ask that you review our diagnosis and follow
the treatment prescribed by the Texas Medical Association in our Healthy Vision 2010: Diagnosis
and Prevention.

Texas physicians and our patients strongly support steps that:

• Add accountability and performance standards to health insurance,

• Expand access to care for all Texans,
• Enhance patient safety, and
• Improve quality of care.

Texas needs a health care system that allows all patients to receive the care they need when they
need it. Removing barriers to affordable, medically needed care is our No. 1 priority.

We know that’s a big task, but we’re Texans.

Respectfully, and on behalf of our 43,000 physician and medical student members and more than
20 million Texas patients, here is the Texas Medical Association’s Prescription for a Healthy Texas.

Josie R. Williams, MD
President, Texas Medical Association
 a He a lthy Te x as
iption for
TMA Prescr

h Insurance Headaches:
To Cure Healt
f conduct
act a h ea lth in surance code o e, timely
✓ En n to m ake appropriat
info rm atio
✓ Give patientsdecisions
health ca re in clinical trials
re for p atients
health ca
✓ Cover routine le fo r o ut-of-network se
rvices
acco un tab
✓ Hold insurers anizations
ulate p re fe rred provider org
✓ Reg
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Health Insurance Company Accountability

Skyrocketing health insurance premiums
are making it more difficult for employ-
ers to offer their employees coverage. No
one feels the challenge more acutely than
Texas’ small businesses.
Over the past decade, health insurers have
decreased their costs by increasing pre-
miums and offering products with much
higher out-of-pocket cost for our patients.
Texans end up paying more each year
for their health insurance but receive less
coverage in return.
Meanwhile, neither physicians nor our
patients can easily access accurate informa-
tion from health insurers to make informed
decisions. It has become impossible for
us to counsel patients on affordable and
efficient treatment plans. To avoid higher
costs, patients need current and honest
information on copays, deductibles, and
health plan networks.
To bring accountability to this multibillion-
dollar industry, TMA is asking legislators
to support the Health Insurance Code of
Conduct 2009 and other legislation. We
must hold health insurance companies ac-
countable to the promises they make
for the premium dollars Texans pay.

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Health Insurance Code of Conduct 2009
These measures would ensure transparency
and accountability in the way health insur-
ance companies conduct business:
✓ Health Coverage Cancellations: Require
an independent review of all decisions
to cancel an individual health insurance
policy prior to the actual cancellation.
✓ Calculation of Premium Quotes: Subject
health insurers to “file and use” require-
ments at the Texas Department of Insur-
ance (TDI), like other kinds of insurers.
✓ Calculation of Medical Loss Ratio:
Require health insurers to disclose how
they spend the patient’s premium dollar.
✓ Unregulated Secondary Networks
(Silent PPOs): Regulate how a physician’s
contract information is sold, leased, or
shared among health insurance companies.
✓ Physician Rankings: Require health
insurance companies to use scientifically
valid criteria to evaluate physicians’
performance, disclosing them in advance.
✓ Claims Processing: Prevent health insur-
ance companies from reverting to their old,
unethical ways of processing claims.
Timely Health Insurance Information
Buying health insurance coverage today is
increasingly complex. Insurance companies
offer a wide range of plans with different
benefits, exclusions, and costs. It is nearly
impossible to decipher the sales literature for
a direct, product-to-product comparison.
Standardized and reliable nutritional labeling
has made it much easier for consumers to
make better food choices. Consumers can
examine 20 different boxes of cereal and
easily compare product benefits such as
Insurance Facts
PLAN IV (PPO)
Monthly Premium $407
Percent of Expense Paid by Plan In-Network 60%
Percent of Expense Paid by Plan Out-of-Network xx%
Annual Out-of-Pocket Expense (est.) $1,669
Your Total Annual Cost (est.) $6,553
Justified Complaints
Premium to Direct Patient Care
Expected Profit
Benefit Levels
Annual Deductible $500
Annual Family Deductible
Annual In-Network Deductible
Annual Out-of-Network Deductible
Out-of-Pocket Maximum $5,000
Office Visit Copay 30%
Rx Copayments $10/$30
Rx Brand Name Deductible $250
Lifetime Maximum $5 million
Emergency Room Visit Copayment $100 copay + 30%*
Number of Electric Wheelchairs per Lifetime
Outpatient Surgery Copay 30% after deductible**
Inpatient Cost Sharing 30% after deductible**
*Your share of the negotiated rate (deductible waived).
**Your share of negotiated rate afer deductible is met.
number of calories, percentage of fat, sodium,
sugar, and protein. The same standardized
system could aid employers and patients
when shopping for health insurance.
TMA’s “Health Insurance Product Labeling
Plan” would require health insurers and their
brokers to use standardized reporting mea-
sures to help employers and individuals make
direct, side-by-side product comparisons.
Once a plan has been selected, patients
should have convenient access to benefit
information when they are making their
health care decisions. Health insurers should
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make this information easily available. Almost
every card in your wallet has some ability
to provide data — except your health insur-
ance card. There is absolutely no reason why
health insurers cannot provide accurate, real-
time information regarding patient benefits
and exclusions.
Routine Medical Care for Clinical Trials
Texans participating in a clinical trial should
be able to use their health insurance to pay
for routine medical costs — especially when
they are suffering from a life-threatening
disease or condition.
Twenty-three states require health plans to
pay routine medical care costs for clinical trial
participants. Medicare does, too. In Texas,
however, patients in clinical trials still must
pay these expenses out of pocket unnecessar-
ily. This must change.
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Accountability for Out-of-Network
Services
Employers and patients pay steadily rising
health insurance premiums. In exchange,
health plans promise a comprehensive
network of physicians, and payment for out-
of-network medical expenses. When health
plans break one or both promises, which
happens often, it dramatically increases the
out-of-pocket expenses for patients.
Texas must hold health plans accountable for
providing comprehensive networks of physi-
cians. We should give TDI authority to ensure
health plans develop adequate networks.
TMA opposes health plans’ attempts to
prohibit balance billing or to establish wholly
inadequate payment rates for non-network
physicians and hospitals.
TDI needs authority to require health plans to
disclose the methods and data they use to set
“maximum allowable” amounts.
Regulation of Preferred Provider
Organizations (PPOs)
Currently the discounted rates physicians
negotiate with health plans are being hijacked
by unregulated PPOs. These entities, called
“silent” and “rental” PPOs, shop around to
find the lowest rate a physician has agreed
to with any health plan. Then the PPO sells,
resells, or leases that discounted rate to insur-
ance companies, discount brokers, and other
unregulated health care businesses without
the physician’s knowledge or permission.
Fourteen states outlaw these arrangements.
Texas should, too.
 TMA Prescr
iption for
a He althy
Te x as
To Cure Health
Care Access Fe
ver:
✓ Help physicia
ns set up pract
served areas ice in medically
under-
✓ Fund graduat
e medical educa
✓ Protect 2003 tion
medical liabilit
✓ Ensure access y reforms
to a medical ho
✓ Establish an ap me
propriate Medic
✓ Ensure all elig aid payment sy
ible children ar stem
programs e enrolled in h
ealth care
✓ Improve men
tal health fund
ing
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Texans Need Affordable and Timely Health Care

Finding affordable care is the most urgent
health care problem facing the state. More
than 26 percent of Texans, 5.6 million people,
are uninsured. In addition to being the unin-
sured capital of the United States, Texas also
ranks last for employer-sponsored insurance.
Only 52 percent of Texans have coverage
through their employer. For small businesses
— the bulk of Texas employers — the num-
ber is even worse: 34 percent.
Cost is the primary culprit. Premiums for
employer-based insurance have more than
doubled since 2000. The average cost for
family health insurance coverage is more than
$12,600 annually.
Uninsured patients create higher health care
costs for everyone. Without continuous care
by a primary care physician or “medical
home,” these patients must seek care in an
emergency room — the most expensive place
to receive care. To compound problems,
Texas continues to face a physician shortage,
especially for primary care physicians. TMA
is asking legislators to take these bold steps to
make health care more affordable and avail-
able to all Texans.
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Adequately Fund Texas’ Physician Loan
Repayment Program
The Physician Education Loan Repayment
Program has been one of the most success-
ful models to address the state’s physician
shortage. However, current funding for the
program covers only about a third of the
average debt a physician accumulates during
his or her 11-plus years of education.
Additional funding is needed to restore
the program so it can be a valuable tool in
recruiting physicians to underserved areas
of the state.
Fund Graduate Medical Education (GME)
Texas needs more GME slots to train the
number of physicians required to care for
our rapidly growing population and reverse
our overdependence on other states and
countries. It is not good fiscal policy for the
state to invest $200,000 in each Texas medical
student over four years, then force graduates
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to leave the state for residency training. Those
new physicians likely will never return to
Texas. TMA calls on legislators to fund medi-
cal school expansions and GME slots. We also
must restore state appropriations for Medicaid
GME, which will allow Texas to obtain ad-
ditional federal matching dollars.
Establish an Appropriate Payment Sys-
tem for Medicaid
Medicaid and the Children’s Health Insurance
Program (CHIP) are good buys for Texas,
given their generous federal matching dollars.
Both programs offer low-income working
parents an affordable way to insure their
children. Medicaid and CHIP payments to
physicians still lag far behind other payment
rates, even after the 2007 increases. Physi-
cians want to participate in these programs
but in many cases cannot afford to open their
practices to Medicaid and CHIP patients. To
ensure access to a medical home for these
patients, legislators must continue to improve
continuity of care and payments through
Medicaid for adults’ and children’s services.
Protect Texas’ Medical Liability Reforms
The 2003 liability reforms have worked.
They’ve lived up to their promise. Sick and
injured Texans now have more physicians
who are more willing and able to give them
the medical care they need. In fact, Texas
has gained more than 14,000 new physicians
representing many high-risk specialties such
as emergency medicine, neurosurgery,
pediatric intensive care, and pediatric
infectious disease.
Physicians enjoy lower premiums and a
more competitive liability insurance market.
It is critical that we protect the 2003 health
care liability reforms, especially the caps on
noneconomic damages and emergency care
provisions. The emergency care protections
have saved lives by helping ensure Texas
patients have access to critical and timely
care. The threat of lawsuit frenzy could harm
Texas’ trauma care.
Improve Mental Health Funding
Mental illness costs the state and local
governments more than $1.5 billion per year.
Each person repeatedly jailed, hospitalized, or
admitted to detoxification centers can cost the
state $55,000 per year. We must expand the
availability of community-based mental
health care for adults and children, including
prevention and early intervention.

Newly Licensed Texas Physicians Jump

by 26 Percent Since 2003 Reforms
4,000

Pre-Reform, Texas Averaged

3,000 2,298 Newly Licensed
Physicians Per Year

Since Reform, Texas Has

2,000
Averaged 2,899 Newly Licensed
Physicians Per Year

1,000

0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2009

Before Tort Reform After Tort Reform

Total number of licensees was adjusted to include an estimated 720 new licensees that were processed during Fiscal Year
2001 but not issued until September 2001, the start of FY 2002 due to lack of funding for an August 2001 board meeting.
Sources: Texas Medical Board, and Texas Medical Association

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 The Physicians’ Foundation Survey Reveals
Looming Decrease in Practicing Doctors
A late 2008 survey by The Physicians’ Foun-
dation depicts widespread frustration and
concern among primary care physicians
nationwide, which could lead to a dramatic
decrease in practicing doctors in the near
future. Nearly half of those surveyed — more
than 150,000 practicing doctors — say that
over the next three years they plan to reduce
the number of patients they see or stop prac-
ticing entirely.
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The bottom line is that the person you’ve
known as your family doctor could be getting
ready to disappear — and there might not be
a replacement.
Combined with the significant lack of primary
care physicians nationwide, these findings
portend health care disaster for Texas, where
the shortage is even more dire. We currently
rank 43rd out of 50 states and the District of
Columbia in number of physicians per capita.
The reported reasons for the widespread
frustration among physicians include
increased time dealing with nonclinical
paperwork, difficulty receiving payment, and
burdensome government
regulations. In fact:
✓ 63 percent said nonclinical paperwork has
caused them to spend less time with their
patients,
✓ 76 percent of physicians said they are
either at “full capacity” or “overextended
and overworked,”
✓ 60 percent would not recommend
medicine as a career to young people, and
✓ Only 17 percent of physicians rated the
financial position of their practices as
“healthy and profitable.”
Physicians say all these challenges combine to
keep them from the most satisfying aspect of
their job: patient relationships.
 TMA Prescr
iption for
a He althy
Te x as
To Cure Ramp
ant Physician S
hortage:
✓ Protect 2003 med
ical liability refo
✓ Improve Texan rms
s’ access to a m
✓ Establish an ap edical home
propriate paym
✓ Fight for a sin ent system for
gle Medicaid
Texans health care stan
dard of care fo
r all
✓ Protect the pat
corporate in ient-physician relationship
terference against
✓ Encourage gro
wth in medical
✓ Enhance fund school enrollm
ing for graduat ent
✓ Improve the e m edical educatio
Physician Educa n
Program tion Loan Repay
ment
take as dire
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Refill as Needed
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Date
Instructio
ns

The physicians of the Texas Medical
Association are committed to working with
business leaders and lawmakers to restruc-
ture our health care delivery systems and
reverse this unhealthy trend. As outlined in
TMA’s groundbreaking Healthy Vision 2010:
Diagnosis and Prevention document, TMA’s
long-term plan would increase the availability,
affordability, and quality of Texas health care.
We also stress wellness and prevention to
stem the growing demand and cost of medi-
cal services in Texas.
Effective health care system reform requires
strong leadership, careful planning, and
extensive collaboration among those who
pay for, deliver, and receive health care. It
must begin by taking short-term, immediate
steps that establish positive momentum.
Our 2009 legislative agenda, Prescription for a
Healthy Texas, prescribes numerous first steps
that can move Texas down the road toward
significant health care reform.

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Page 10
 TMA Prescr
iption for
a He althy
Te x as
To Cure “Buye
r Beware” Virus:
✓ Fight for a sin
gle health care
Texans standard of care
for all
✓ Protect the pat
corporate in ient-physician relationship
terference against
✓ Preserve reta
care team ap il health clinic oversight and
proach the health
✓ Eliminate was
te and overuse
of health care
resources
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Ensure High-Quality Health Care for All Texans

Texas has a shortage of physicians, both
primary care physicians and specialists. We
currently rank 43rd out of 50 states and the
District of Columbia.
The passage of the 2003 landmark medical
liability reforms has helped Texas bring more
than 14,000 new physicians to take care of
Texas patients. However, we still don’t have
enough physicians to keep up with our robust
population growth.
Unfortunately, many seek to fill this
void with nonphysician practitioners,
corporations, and retail health clinics.
Some would prevent physicians from
owning a health care facility and/or life-
saving equipment. This only further restricts
our patients’ ability to receive cost-effective
and timely care. TMA argues that lowering
the standard of care is neither a good solution
nor good public policy for improving Texans’
access to quality health care.

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Ensure a Single Standard of Care for All
Texans
TMA is committed to a single high standard
of care for all Texans. This means that care
is centered on each patient’s need and each
patient receives high-quality care by a well-
trained team of professionals supervised by
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a physician. We must protect the safety of
Texas patients and ensure they receive the
best medical care by the best person trained
to deliver that care. Only physicians have the
broad clinical expertise and training to exer-
cise independent medical judgment and serve
as the trusted leader of the health care team.
Nonphysician practitioners are valuable mem-
bers of the health care team but are limited
by their education, training, and skills as to
the level of care they can safely provide.
The legislature must prevent nonphysician
practitioners from expanding their scope of
practice beyond that safely permitted by their
education, training, and skills.
Protect the Patient-Physician
Relationship
Texas prohibits the corporate practice of
medicine. The principle is simple. Only physi-
cians, not corporate entities, are licensed
by Texas to provide medical services. The
fundamental purpose of this law is to ensure
physicians’ independent medical judgment.
This independence is critical. It ensures that
our patients’ medical needs come before a
hospital or governmental entity’s business
needs. TMA opposes efforts to broaden the
corporate practice of medicine beyond the
current exceptions for medical schools,
501a corporations, and federally qualified
health centers (FQHCs). We also believe the
Texas Medical Board should be required
to maintain current information on the
sponsorship, governance, and membership
of 501a corporations.
Preserve Retail Health Clinic Oversight
Retail health clinics were designed to give
patients access to fast, convenient, and afford-
able health care. But because the clinics are
staffed by advanced practice nurses (APNs) or
physician assistants (PAs), they do not provide
the same level of care as physicians’ offices,
urgent care clinics, or minor emergency cen-
ters. TMA supports an integrated care model
where the APNs and PAs staffing the clinics
are appropriately supervised by a physician,
refer patients back to the patients’ regular
physician to ensure continuity of care, refer
patients appropriately for additional or follow-
up care, and practice within their scope of
practice.
Ownership of Health Care Facilities and
Equipment
Physician-owned hospitals are not new.
Physicians founded many of the nation’s first
hospitals to ensure appropriate care for their
patients. There have, however, been con-
siderable changes in health care financing
and coverage over the past decade. These
changes drive the debate over who can invest
in a facility. TMA believes that responsible
ownership, whether by a physician or hos-
pital, should be patient-centered and include
a commitment to appropriate peer review of
utilization, quality, and safety to ensure the
highest quality care for our patients.
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 a He a lthy Te x as
iption for
TMA Prescr
y Lifestyle Epidemic:
nhealth
To Cure Our U
esity
ve agg ress ively to prevent ob
✓ Mo ban
E nac t a statewide smoking
✓ ection
nd ca n cer pre vention and det
✓ Fu ion rates
Im p ro ve Te xas’ immunizat
✓

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Improve Texas’ Fiscal and Physical Health

Heart disease, cancer, and stroke may be the
most common causes listed on death certifi-
cates. However, the real killers are tobacco,
poor diet, stress, and lack of exercise. Stud-
ies indicate that at least 50 percent of health
care spending is lifestyle-related and could be
preventable.
The obesity epidemic threatens Texas’ physi-
cal and fiscal health. Texans young and old
are growing fatter. Nearly 66 percent of Texas
adults and 32 percent of Texas teens are
overweight or obese. Obesity-related diseases
such as diabetes, arteriosclerosis, and
hypertension are increasing at the same
rate as obesity.
Tobacco also exacts a high price from busi-
ness and taxpayers. In Texas, more than $12.2
billion can be attributed to the costs associ-
ated with smoking. The cost per smoker is
about $3,561, which includes direct medical
and indirect costs.
To improve the physical and fiscal health of
Texas, all of us — individual Texans, their
families, physicians, health care profession-
als, government, and health plans — need to
focus on wellness and prevention.

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 Stop the Obesity Epidemic
Obesity and related diseases like diabetes are
major factors behind rising health care costs
and health insurance premiums. Texas spends
$5.3 billion on medical costs related to over-
weight and obesity. To stop the obesity epi-
demic, we must focus on preventing obesity
rather than treating the diseases that it causes.
TMA is asking legislators to pass legislation
and funding for a coordinated school health
program for all grade levels. We also must
fund education on the importance of proper
nutrition and physical activity.

Projected Increase in Number of Obese* Adults in Texas, 2006-2040

(in millions)
16

14

12

10
Anglo
8 Black
Latino/a
6
Total
4

0
2006 2010 2020 2030 2040
Source: Office of State Demographer, Moderate Projection *BMI<=30

Page 15
Make Texas Smoke-Free
Banning smoking in public
places is one of the easiest,
simplest, and fastest public
health interventions Texas
could undertake. Twenty-
eight states have adopted
smoking bans in restaurants;
22 of these states also pro-
hibit smoking in workplaces.
TMA believes it is time that
Texas joins these ranks.
We are asking lawmakers
to pass a statewide ban on
smoking in public places.
Employers also should
receive tax incentives to
reward nonsmokers and encourage smokers Improve Texas’ Immunization
to participate in tobacco cessation programs. Immunizations are important, effective, and
safe. Each year more than 42,000 adults
Cancer Prevention and Detection for and 300 children die in the United States
Frontline Physicians from vaccine-preventable diseases and their
Primary care physicians are the front line of complications. Physician efforts are essen-
cancer prevention and detection. In 2007, the tial. Unfortunately, physicians’ payments for
voters passed a constitutional amendment purchasing, storing, and administering vac-
authorizing the state to issue up to $3 billion cinations do not cover their cost. Physicians
in bonds to fight cancer. It is important that also must pay a new state tax on vaccines,
we use Proposition 15 funding to help a further disincentive for some physicians to
enhance care for Texas patients and reduce provide immunizations. Improving payments
the incidence of cancer in the state by to physicians for administering vaccines is
educating physicians about the latest cancer important. It ensures children have a regular
treatments and technological advances. physician in charge of their care — a medical
home — and protects our communities from
preventable diseases.

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Page 17
Texas Medical Association
401 West 15th Street
Austin, Texas 78701-1680
www.texmed.org