July 9, 2008

TO:  Board of Trustees 
        APA Assembly 
        Council on Advocacy and Public Policy & Committees 
        APAPAC Board 
        APA-CAN Grassroots Members 
        APA District Branch & State Association Executive Staff 
        APA Members

FR:  Nicholas M. Meyers, Director of Government Relations

RE:  SENATE PASSES MEDICARE BILL; VOTES TO END 40 YEARS OF DISCRIMINATION AGAINST PSYCHIATRIC PATIENTS

It is my very great pleasure to let you know that just moments ago, the United States Senate voted 69-30 to cut off debate and pass H.R. 6331, the House-passed Medicare package that blocks impending payment cuts to physicians for 18 months. The legislation also brings to an end more than 40 years of discrimination against Medicare patients receiving outpatient mental health care, who are required to pay a 50% coinsurance as opposed to the 20% coinsurance applied to all other Part B services.

Passage came in dramatic fashion as Senator Edward M. Kennedy (D-MA) -- in his first appearance on the Senate floor since being diagnosed with brain cancer -- cast the decisive vote. As soon as Senator Kennedy assured the win, nine additional Republicans switched their votes from No to Yes, joining their 9 GOP colleagues who had again voted for passage, giving the bill two more votes than the 67 needed to assure a veto-proof margin of victory. The nine additional Republicans are Senators Alexander (TN), Corker (TN), Cornyn (TX), Chambless (GA), Hutchison (TX), Isakson (GA), Martinez (FL), Specter (PA), and Warner (VA). They joined Senators Collins (ME), Coleman (MN), Dole (NC), Murkowski (AK), Roberts (KS), Smith (OR), Snowe (ME), Stevens (AK), and Voinovich (OH), who voted Yes for the second time in two weeks.

Of interest to APA members, as passed by Congress, H.R. 6331 will:

--Block an impending 10.6% cut in the Medicare payment update until January 1, 2010.
--Provide a 0.5% positive update for the remainder of 2008.
--Provide a 1.1% positive update for 2009.
--Provide a temporary bump in payments for psychotherapy services.
--Shift the budget neutrality requirements of the payment formula from work values to the conversion factor.

While cautioning that we are still reviewing the practical consequences of all of these factors, we believe that they will result in a meaningful increase in Medicare payments for at least some and perhaps many APA members.

In addition to the much-needed payment provisions, H.R. 6331 includes 3 significant policy changes impacting psychiatric patients that APA has lobbied over many years. These will:

--Phase-out (over 6 years) the discriminatory 50% coinsurance that has been required for outpatient mental health services since Medicare was first established.
--Require coverage of benzodiazepines and barbiturates under Medicare Part D.
--Create statutory protections for certain classes of medications (including antidepressants and antipsychotics) that ensure that medically vulnerable patients will have access to "all or substantially all" such medications under Part D.

Please note that it is reported that the President will veto the bill and will undoubtedly try to peel off the 3 Republicans needed to prevent a veto override. We will need to work to ensure this does not happen. In the meantime, however, on behalf of your DGR staff I would like to thank the APA national and District Branch/State Association leadership, and APA members across the country for their tireless efforts to achieve this dramatic victory. Particular thanks to the leadership, members, and Executive Staff in the states of those GOP members we targeted as possible Yes votes. This tremendous victory would not have been possible without your active support.