As Healthcare Finance News went to press, physicians faced “a whopping pay cut” of 21 percent in Medicare reimbursement beginning April 1.
Congress delayed the pay cut twice this year, from Jan. 1 to March 1, then to April 1, with the Senate recently passing a bill to delay it until Oct. 1.
But doctors are tired of delays. They want a permanent fix to what they and many experts consider a broken payment formula, known as the sustainable growth rate (SGR).
American Medical Association President J. James Rohack, MD, has warned Congress that without adequate reimbursement, physicians may drop from the Medicare program creating care access problems for seniors.
“Short-term actions are the wrong answer to a long-term problem,” Rohack said after the recent Senate vote. “These band-aid fixes have only served to increase the size of the cuts and the cost of reform.”
“The longer Congress delays, the higher the cost to the American taxpayer,” he said. “It’s time to fix the formula and ensure that seniors can count on Medicare now and for years to come.”
The Centers for Medicare and Medicaid Services is mandated to adjust the Medicare physician fee schedule annually, based on the SGR adopted in the Balanced Budget Act of 1997.
Using the formula, CMS has issued negative updates every year saince 2002. Congress has intervened over the past several years to postpone pay cuts.
Congress has struggled since 2009 over where to include a permanent fix for the Medicare physician payment formula. A Medicare physician pay “fix” was not included in the healthcare reform package passed March 21.
Most members of Congress agree that Medicare payments to physicians are too low, but few have been able to come up with a satisfactory way to pay for it.
Bob Doherty, senior vice president of government affairs and public policy for the American College of Physicians, said at a recent briefing that he doesn’t know what kind of vehicle Congress will use to correct the physician payment formula, “but a long-term change must be enacted.”
“The problem is, because of the failure of past Congresses to deal with the SGR in a straight way, they have dug a hole so deep they don’t know how to get out of it or where to find the money,” he said.