Last week, shortly after the Senate passed legislation that would temporarily “fix” the susbtainable growth rate (SGR) problem for reimbursement in the Medicare and Medicaid programs, the House of Representatives passed the same legislation.
The $15 billion bill that passed, keeps the Medicare physician payment rates steady through 2011 by blocking the impending 25% cut in the Medicare pay rate. President Obama signed the legislation on December 16. Had the legislation not been passed, physicians would have seen a cut in their reimbursement starting January 1, 2011.
According to MedPage Today, the one-year fix is the “fifth and longest extension of Medicare physician payment rates passed by Congress this year.” The problem with this legislation is that it is temporary, and it essentially “puts doctors back in the yearly “last-minute-extension” cycle Congress has followed for most of the past decade.”
This means that unless Congress figures out a long-term solution to fix the SGR problem in the meantime, doctors will be subject to a cut of more than 25% in Medicare rates in 2012.
“I wish the Senate could do what the House did last year, which is to enact a permanent solution to this problem,” said Rep. Frank Pallone (D-NJ) in a statement. “But until that happens, this one-year approach is a major improvement over a series of very short-term bills.”
How to Pay for The Doc Fix
To reach a deal on the “doc fix,” the bill increases the amount a person would have to pay the federal government if he or she received too large of a federal subsidy. Under the Affordable Care Act (ACA), people who make up to four times the federal poverty level will receive federal subsidies starting in 2014 to help them purchase the insurance that law mandates they have (individual mandate).
Under the ACA, if a person receiving the credit does not accurately state his or her income, or if the person’s income increases during the year, he or she would have to pay the government back $250 or $400 for a family.
The SGR bill replaces the flat-rate with a sliding scale, requiring those with low incomes to pay less, and requiring those with higher incomes to pay much more — between $600 and $3,500 depending on income. The bill does not change the income requirements for receiving the subsidies in the first place.
Republicans used the new provisions that amended the ACA in exchange for their support of the “doc fix.” The SGR bill also:
– Extends a payment mechanism that adjusts for geographic differences in the cost of providing medical care
– Provides exceptions for caps in cases where additional therapy services are deemed to be medically necessary
– Extends increased rates for ambulance services, and
– Provides a 5% increase in payments for certain mental health services.
The American Medical Association (AMA), which has been lobbying Congress to delay the cuts through 2011, lauded the bill’s passage, but said a longer term fix to the SGR problem is badly needed. AMA president Cecil Wilson, MD, acknowledged that “The AMA will be working closely with congressional leadership in the new year to develop a long-term solution to this perennial Medicare problem for seniors and their physicians.”
Consequently, Dr. Wilson noted that “This one-year delay comes right as the oldest baby boomers reach age 65, adding urgency to the need for a long-term solution before this demographic tsunami swamps the Medicare program.” This means that finding a solution for a permanent “doc fix” must be addressed by the new Congress, especially given the shortages of physicians and practice groups refusing to take any more Medicare patients.
Practicing medicine is an extremely risky and highly regulated profession. Physicians barely can keep their heads above water in certain practice areas and constantly struggle with administrative burdens and insurance companies to receive reimbursement for their services. This is all under the pressure of paying hundreds of thousands of dollars in medical school loans.
In hindsight, Congress should have figured out how to fix paying doctors for the patients they already see, before adding more patients that doctors literally cannot afford to see. Accordingly, if America is going to add more patients into the system, Congress needs to ensure that the doctors who will treat those patients are being paid fairly and adequately for the services they provide and the risks that they have taken and continue to take.