AMA Gives Obama Warm But Wary Reception

CHICAGO, June 15, 2009— -- In his highly anticipated speech to the American Medical Association, President Barack Obama said he wants the AMA onboard the healthcare reform train -- but he won't delay its departure if the AMA hesitates.

"To say it as plainly as I can, health care reform is the single most important thing we can do for America's long-term fiscal health. That is a fact," Obama said.

"In order to do that we are going to need the help of the AMA."

The historic speech in front of a group that has blocked past reform efforts was met with respect -- he was interrupted 36 times by applause, including a handful of standing ovations. But at least once -- when he said he would not back caps on jury awards in medical liability cases -- he was booed, although the booing was notably restrained given the emotional attachment the AMA has to tort reform built on caps.

"They responded positively but warily," said Dr. Michael Reichgott of New York, a delegate from Medical Education Section of the AMA. "Everybody was being very skeptical. There is a great deal of cynicism about what the government really intends to do."

And on this issue at least, the cynicism came from both sides. The Center for Justice and Democracy, which purports to advocate for injured consumers, attorneys and others, issued a letter to Obama signed by 64 survivors of medical malpractice. The letter expressed concern that "the rights of medical malpractice patients may be stripped away" as a result of the president's national health care push.

Obama told the AMA that what his administration -- the government -- intends to do is to do is enact a $1 trillion reform plan to cover nearly every United States citizen and to expand access to medical care.

After focusing on the parts of reform where agreement was a given -- coverage for preventive medicine, moving the nation from cardboard file folders for patient records to a portable electronic health record, and freeing doctors from hassles that turn them into "bean-counters and paper-pushers" rather than "healers" -- Obama turned to what has proven to be most controversial aspect of reform: the public plan.

Obama tried to sell the idea of a new public insurance plan to a group of people who have, by in large, been against it.

The president would like the government to run a Medicare-like insurance option alongside private plans, all of which would be purchased through an insurance clearinghouse called the "exchange."

But Republicans in Congress are vehemently opposed to the idea, calling it a "government takeover," that would drive private insurance companies out of business.

Some AMA members said they fear a public plan would be too much government-interference in their medical practice.

As former AMA president Dr. John Clowe, a retired family physician who practiced in New York, put it, "The AMA doesn't approve of government-run medicine. We want independence."

But Obama promised the public option was not his secret scheme to turn the U.S. system into a single-payer system.

"The public option is your friend, not your enemy," he said.

"So, when you hear the naysayers claim that I'm trying to bring about government-run health care, know this -- they are not telling the truth."

Last week the AMA began to signal its objection to a public plan, and it immediately found itself enmeshed in controversy as other organized medicine groups criticized the position.

A day after voicing its objections to public option, the AMA was forced to issue a second statement -- this time rebuking the New York Times for its reporting of the AMA stance.

Dr. Nancy Nielsen, outgoing president of the AMA, said then that the article was an unfair characterization and that while the AMA opposes a plan that would require physician participation and reimburse at Medicare rates, it is open to hearing specifics of all healthcare reform plans.

And while Nielsen has sought to soften the blow, the AMA's House of Delegates is slated to vote on a resolution that would codify AMA's opposition to a public plan option.

Obama didn't back away from the idea of using Medicare payment rates, but he told the crowd that while the AMA had a "legitimate concern" that physicians would be reimbursed less if Medicare payments were applied in the public plan, he wanted to improve Medicare payments so that physicians would be reimbursed based on best practices and patient care instead of output.

"With reform, we will ensure that you are being reimbursed in a thoughtful way tied to patient outcomes instead of relying on yearly negotiations about the Sustainable Growth Rate formula that's based on politics and the state of the federal budget in any given year," he said.

As soon as Obama mentioned the Sustainable Growth Rate formula, the delegates were on their feet applauding since the formula -- known as the SGR -- has been a constant thorn in physicians' sides for the last decade.

From the physician prospective, the SGR is a formula based on bad math that ends up threatening them with payment cuts of 5 percent or more each year -- until Congress steps in with its annual "Hail Mary" fix. But the yearly fixes have not ended up increasing Medicare payments to physicians, so the bottom line is that reimbursement is stuck at 2001 rates.

While Obama was short on the specifics of exactly what would replace the SGR, Nielsen said in a press conference following the speech that she's convinced the president understands the arcane formula for determining physician's Medicare payments needs to be scrapped.

At the post-speech press conference, Nielsen also resisted the urge to hammer Obama about his disavowal of caps on jury awards in malpractice cases.

"Hey, you have to give credit where credit is due," she said. "This is the first Democratic president to talk to us about any kind of liability reform."

Reichgott said he respected that Obama didn't leave out the parts of his plan that would obviously be unpopular with the AMA crowd.

"He didn't say things just to play to the needs of the crowd," he said.

Nonetheless, it's unclear if the pas de deux danced by the administration and the AMA today will signal a new cooperative spirit.

In the afterglow, at least some delegates were willing join Nielsen in giving the president his due.

"The most important thing is he came here, he spoke to the group, he said he would listen, he's been listening, and I think those are really important things," Reichgott said.

AMA Delegate Dr. Phillip Tally, a neurosurgeon from Bradenton, Fla. echoed that sentiment.

"I think he scored a lot of points with doctors... just by his presence here."

Reports from the Associated Press contributed to this report.