Various physician organizations told a House panel last week that they anticipate a significant number of their memberships dropping from Medicare participation should the 10.6 percent cut go into effect July 1, as slated.
The House Committee on Small Business held a hearing May 8 to look at how the pay cuts will affect small practices in particular.
The vast majority of physician practices are small businesses, according to Cecil Wilson, MD, on the board of trustees for the American Medical Association and a witness at the hearing.
"Fifty percent of physician practices have less than five physicians, and yet account for 80 percent of outpatient visits," Wilson said. "Steep payment cuts under the (current payment method), along with numerous other challenges in the current healthcare environment, threaten the continued viability of these practices."
A recent Medical Group Management Association (MGMA) survey of more than 1,100 medical groups and 28,679 physicians nationwide found that group practices "have already taken significant steps in reaction to the tenuous reimbursement environment," said Mona Reimers, president of the MGMA's Indiana chapter.
According to the MGMA survey, nearly 24 percent of respondents said they have already begun limiting or not accepting new Medicare patients. Nearly half of the respondents said they plan to stop accepting Medicare patients or will limit the number of Medicare patients they treat if the July pay cut goes into effect.
Herb Kuhn, deputy administrator of the Centers for Medicare and Medicaid Services, said CMS recognizes the problems in the current payment formula for calculating annual physician payment updates.
"CMS is concerned by the tremendous amount of uncertainty the recent approach to physician payment issues causes at the physician level, which can be particularly difficult for small physician practices," he said.
Kuhn emphasized that CMS plans to add quality and transparency into any new strategy of paying physicians under Medicare. "Given the size and impact of the Medicare program, now and in the future, it is critical that we move from passive payer to active purchaser of high-quality, efficient care," he said.
In March, Sen. Debbie Stabenow (D-Mich.) introduced the Save Medicare Act of 2008 to block the July 1 Medicare payment cut and allow 18 months of payment updates that better reflect medical practice cost increases. The bill is currently in the Senate Finance Committee for consideration.
How does your practice plan to handle a 10.6 Medicare payment cut July 1 if no bill comes through to block it? Email diana.manos@medtechpublishing.com