Provider Status Explained: Understanding the how behind the federal legislative strategy

Provider status is essential to the future of the profession of pharmacy. We explained last week the reason why pharmacists need provider status now more than ever (if you missed it, check out the post here) and began to discuss some of the background around why this shift in the business model is so substantial. For all the Simon Sinek Golden Circle fans out there, now that we have dissected the why, the natural next step is to understand how we shift this business model in pharmacy. This week we will take a look at how this could happen at the federal level and will follow up with a look at states next.

Public Payors Influence the Private Sector

You may be thinking, “Okay, we need to shift our revenue stream. Why are legislative or regulatory changes even necessary? The role of the pharmacist has shifted, let’s charge for the patient care services we provide.” Although this “build it and they will come mentality may be applicable to other sectors of the economy, the business of healthcare is pretty unique. Because healthcare is so expensive, it is not realistic to expect to build a sustainable business model outside of the health insurance system.

The next challenge is to understand how to integrate the pharmacist into the health insurance system to be paid as providers. So, if we were to simplify the health insurance system to the extreme, we could say there are two paths you could choose to go down: public payors or private payors. Looking at other sectors of the economy, you can make an observation similar to Ellen Glasgow: “The government’s like a mule, it’s slow and it’s sure; it’s slow to turn, and it’s sure to turn the way you don’t want it.” So, you may think the private sector is the way we must go, and may set your sights on behemoths like UnitedHealth Group, Anthem, or Humana.

But, healthcare doesn’t work like other businesses. Despite the normal mantra that the private sector innovates, and the public sector adopts, healthcare tends to be the opposite. This may be because, as was discussed in the first installment of our series, business follows the money. Despite there being behemoths in the private health insurance industry, the single largest insurer of the most people in the United States is the public healthcare system (Medicare and Medicaid). With this significant share of the marketplace, the public payors have created a culture in which they shape change in the healthcare system.

So, a strategy is starting to take shape. An effective way to be recognized as healthcare providers is to create legislative or regulatory changes at the federal level specific to the public health insurance system.

The Social Security Act

What we are seeking is reimbursement for pharmacist-provided patient care services under Medicare Part B. This would align us with other comparable healthcare professionals that are reimbursed for their services under the medical insurance system. So, you may be asking yourself, how do you change who can be reimbursed for healthcare services under Medicare Part B? Well, it all comes back to the Social Security Act, and the influence this giant piece of legislation has had on our healthcare system.

The Social Security Act was signed into law in 1935 and established many of the social programs much of our country has come to depend on (e.g. Social Security Program, unemployment insurance, maternal & child welfare programs). Thirty years after originally signed into law, the 1965 Amendments were passed establishing the Medicare and Medicaid Systems. Included in Section 1861(s)(2) of the Social Security Act is a list of all healthcare providers other than physicians that can be reimbursed under Medicare. The healthcare professionals stretch across the gambit, from physical therapists and physician assistants to social workers and psychologists. Notably missing from this list, though, is the pharmacist.

Our mission is clear: to add pharmacists to this list. But is this even possible? How can we be sure this strategy can even be accomplished? If only we could test this strategy with a recent example from another healthcare (since 1997) provider.

The Nurse Practitioner Strategy

After more than 20 years of grassroots advocacy campaigns and systematic legislative victories in Congress, the 1997 Balanced Budget Act was signed recognizing nurse practitioners (NPs) as healthcare providers under Medicare Part B. Prior to this legislative victory, NP salaries were paid out of the health systems that they worked for, and the justification for their salaries was largely dependent on expected cost savings and an increase in health outcomes of patients that was associated with the care that they provided. Sound familiar?

Recognizing the unsustainability in an indirect ability to bill for patient care services and how this could negatively result in a lack of access to patient care services, nurse leaders began organizing and forming advocacy campaigns in the 1970s. They began with the introduction of a bill in 1974 that would recognize NPs as providers and it died. Recognizing the limited ability to make such a substantial change in one swoop, they reevaluated their strategy and instead began passing smaller, more realistic bills that began to create a culture shift within the healthcare team in our country. Over the course of these decades, NPs came together as a profession, completing numerous grassroots advocacy campaigns that resulted eventually in the signing of the bill in 1997 that finally got them to their goal.

From a historical perspective, we can see that legislative victories in this country often come down the path of incremental change. One may make the observation that by leaning into those incremental changes for 20 years, NPs were able to get to their final goal: provider status. If you’re interested in reading more about the nurse practitioner journey and how it relates to pharmacists, check out the great article here.

If we are to adopt a similar strategy, the profession of pharmacy should consider what the incremental changes are that we can adopt to get us to the finish line. There has never been a better time. The COVID-19 pandemic has highlighted the essential nature of pharmacists in our healthcare infrastructure, and has showcased to policy makers how vital pharmacists are in local communities. 

Incremental change, you say?

We’ve torn apart the why and the importance behind this issue. We’ve examined the how when it comes to our federal legislative strategy. But we can’t ignore the states and their (proportionally) greater nimbleness when it comes to implementing change. In the next installment of the Provider Status Explained series, we will be tackling the how behind the state strategy to reach provider status and postulate around the eventual tipping of a scale when a majority of states pass the finish line that may increase the chances of national success.

Until next time, stay curious and passionate.

Published by The Grassroots Pharmacist

We are pharmacists passionate about engaging pharmacists in advancing health policy

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