Washington Highlights: March 25,
2005
Medicare Hospital
Insurance Fund Solvent Until 2020
Contents
Prior Issues
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The Trustees of the Social Security and Medicare trust funds March
23 released their annual report
on the current status and projected condition of the funds over
the next 75 years. The Medicare Part A Trust Fund will be financially
insolvent in 2020, one year later than projected last year. The
report states that Medicare Parts B and D will be "adequately
financed, since premium and general revenue income are reset each
year to match expected costs." However, it warns that the government
will have to "rapidly" increase the premiums and general
revenue transfers from the U.S. Treasury that fund Parts B and D
in order to "match expected expenditure growth under current
law." Part B expenditures on benefit payments are expected
to rise from $149.3 billion in 2005 to $264.3 billion in 2014, and
represent 4.8 percent of GDP by 2079.
According the summary of the report, "Medicare's financial
difficulties come sooner - and are much more severe - than those
confronting Social Security" due to increases in underlying
health care costs per enrollee. The fund fails the trustees' short-range
10-year financial adequacy test as well as the long-range test of
75 years by a wide margin.
The Medicare trustees did find that the program's financial outlook
has improved slightly compared to last year's estimate. The trustees
estimate that Medicare's Hospital Insurance (HI) Trust Fund is projected
to be exhausted in 2020, one year later than estimated in last year's
report. This change results from slightly higher income and slightly
lower costs in 2004 than previously estimated. Projected costs for
Medicare Part D, which funds Medicare's new drug benefit, are also
lower than forecast in last year's Trustees Report, contributing
to the improvement in Medicare's overall spending outlook.
The Trustees expect the Medicare Economic Index (MEI) used to calculate
physician payments to remain fairly steady over the next 10 years,
at about 2 percent annually. However, they project negative physician
updates of "5 percent annually for 6 consecutive years, beginning
in 2006." According to the report, the negative update reflects
recent "increases in physician expenditures, exacerbated by
the physician updates legislated in the MMA." The MMA (Medicare
Modernization Act) legislated 1.5 percent physician updates in CYs
2004 and 2005.
States the report, "These projections demonstrate the need
for timely and effective action to address Medicare's financial
challenges. Consideration of such reforms should occur in the relatively
near future. The sooner the solutions are enacted, the more flexible
and gradual they can be."
Senate Finance Committee Chairman Charles Grassley (R-Iowa) responded
to the release of the report stating, "Congress also needs
to examine ways to make the Medicare program more effective by providing
incentives that reward efficient, high quality care. Congress already
took a major step forward with the new benefits outlined in the
Medicare Modernization Act of 2003 (MMA)." Both Sen. Grassley
and House Ways and Means Committee Chairman Bill Thomas (R-Calif.)
said that as the MMA is implemented, Congress should evaluate the
effectiveness of these provisions.
Information:
Lynne Davis Boyle, Assistant Vice President
AAMC Government Relations
ldavisboyle@aamc.org
(202) 828-0526
Christiane Mitchell, Senior Legislative Analyst
AAMC Government Relations
cmitchell@aamc.org
(202) 828-0526
AAMC Testifies to FDA on Adverse Event Reporting
The Food and Drug Administration (FDA) held a March 21 hearing
to consider reforms by which adverse events in clinical studies
can most effectively be reported to Institutional Review Boards
(IRBs). The occurrence in a clinical trial or other study of an
unexpected and serious medical complication related to the test
product may cause an IRB to require a change in the study or in
the informed consent. However, the IRB needs complete information
in order to determine if the event changes the risk to study participants.
As it first announced in the Federal Register on Feb. 8,
the FDA is seeking to ensure that such events are most effectively
reported and evaluated so that IRBs can act decisively.
AAMC Senior Research Consultant Howard Dickler, M.D., testified
on behalf of the Association, along with representatives from other
academic, clinical research, and pharmaceutical organizations. Dr.
Dickler noted that the purpose of IRBs is to minimize risk to participants,
and to balance a study's risk with its potential benefit. IRBs were
never intended to act as scientific review or data monitoring committees.
The AAMC and other academic organizations recommend that study sponsors,
who have the most complete access to data from all sites in a clinical
trial, be responsible for providing a complete evaluation and summary
of all the data when reporting adverse events to IRBs and investigators.
Information:
Howard Dickler, M.D.,
hdickler@aamc.org, (202) 828-0567
Human Cloning Ban Bills Introduced in Senate,
House
Legislation was reintroduced March 17 in the Senate and House to
prohibit human cloning. "The Human Cloning Prohibition Act
of 2005," introduced as S.
658 by Senator Sam Brownback (R-Kan.) and as H.R. 1357 by Rep.
Dave Weldon (R-Fla.), would prohibit any person or entity, public
or private, from:
- performing or attempting to perform human cloning;
- participating in an attempt to perform human cloning; or
- shipping or receiving for any purpose an embryo produced by human
cloning or any product derived from such embryo.
The bills also make it unlawful to import for any purpose an embryo
produced by human cloning.
Human cloning is defined in the legislation as "human asexual
reproduction, accomplished by introducing nuclear material from
one or more human somatic cells into a fertilized or unfertilized
oocyte whose nuclear material has been removed or inactivated so
as to produce a living organism (at any stage of development) that
is genetically virtually identical to an existing or previously
existing human organism."
The legislation states it does not restrict "areas of scientific
research not specifically prohibited by this section, including
research in the use of nuclear transfer or other cloning techniques
to produce molecules, DNA, cells other than human embryos, tissues,
organs, plants, or animals other than humans."
The bills provide for criminal penalties of fines and/or imprisonment
for up to 10 years and, for cases that involve pecuniary gain, civil
penalties of not less than $1 million and not more than an amount
equal to twice the gross gain, if that amount is greater than $1
million.
The Senate bill also directs the Government Accountability Office
(GAO) to report to Congress within 4 years of enactment on the need
to amend the human cloning ban created by this legislation. The
report is to include "a discussion of new developments in medical
technology concerning human cloning and somatic cell nuclear transfer,
the need (if any) for somatic cell nuclear transfer to produce medical
advances, current public attitudes and prevailing ethical views
concerning the use of somatic cell nuclear transfer, and potential
legal implications of research in somatic cell nuclear transfer,"
as well as a review of any technological developments that may require
that technical changes be made to in the legislation.
Information:
Dave Moore, Senior Director
AAMC Government Relations
dbmoore@aamc.org
(202) 828-0525
National Academies Releases Report on Fostering
Independence in New Researchers
The National Research Council of the National Academies March 18
released a report suggesting that the National Institutes of Health
(NIH) promote independence among new biomedical researchers by improving
their training and giving them more resources to pursue their own
projects. The report, Bridges
to Independence: Fostering the Independence of New Investigators
in Biomedical Research, also addresses concerns about the
increasing age at which new investigators establish independent
research careers. Thomas Cech, Ph.D., president of the Howard Hughes
Medical Institute, chaired the Bridges to Independence Committee
that wrote the report.
The report makes several recommendations for NIH to improve postdoctoral
training: enforce a five-year time limit on all postdoctoral funding,
including research grants; reallocate resources for postdocs away
from R01-supported research and toward individual awards and training
grants; and provide a new research award for postdoctoral researchers
to conduct independent research under the mentorship of a senior
investigator. The report also recommends that foreign students be
permitted to apply for training grants that currently have U.S.
citizenship requirements or to make equivalent avenues of support
available.
In order to make mentors more accountable for training, the report
also recommends modifying the R01 grant application to clarify the
mentorship responsibilities of PIs. Applications would require a
description of how the postdoc would be prepared for independent
research careers, a description of how the postdoc would be involved
in the proposed projects, and a list of current postdocs as well
as the name, time in laboratory, and current position of all postdocs
supported in the past decade. The panel also recommends that NIH
support efforts by universities, academic departments, and research
institutions to supply postdocs with more opportunities to learn
professional skills. Enhanced data collection systems on postdoctoral
researchers to include all NIH-supported researchers, regardless
of specific funding mechanism, would provide the ability to analyze
the effectiveness of scientific programs.
To address the difficulties that new investigators face in making
the transition to an independent research career, several new funding
mechanisms were suggested. Twelve NIH institutes now offer some
form of K22 career-transition awards. The report suggests replacing
these awards with an agency-wide grant program for scientists moving
into their first independent investigator positions; the program
would provide up to two years of postdoctoral support and 3-4 years
of support in independent research positions. In addition, the NIH
should create a "New Investigator R01" award that asks
for previous experience instead of preliminary results. As the number
of "soft-money" non-tenure track staff scientist positions
continues to grow, the report proposes that NIH and host institutions
share responsibility for a budgetary "safety net" that
provides time to reapply for grant support if their funding lapses
by a combination of "bridge support" and multi-year contracts.
The report also recommends the creation of renewable "small
science" research grants to support non-tenure-track researchers
who are not PIs on other significant grants.
Information:
Jodi Lubetsky, Staff Associate
AAMC Division of Biomedical and Health Sciences Research
jlubetsky@aamc.org
(202) 828-0485
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