Senate Debates Doc Fix Off Budget – AMA Pushes Hard for Legislation

While over 40 years ago, the American Medical Association (AMA) ‘opened it’s bid to kill Medicare,’ today they are now broadcasting a new television commercial about Medicare with a different take: “the doctors want to protect the program, and themselves, from steep cuts in payments,” according to the New York Times.

One of the main reasons the AMA is carrying out this campaign is to avert nearly $250 billion over 10 years, in legislation separate from the big health care overhaul. Specifically, S. 1776 is a “Senate bill that would permanently adjust a Medicare payment formula,” which would prevent steep annual cuts in the rates that doctors are paid. Essentially, the AMA worked with politicians by saying they would support health care reform if the cuts were ‘fixed.’

For those on Capitol Hill, preventing cuts in Medicare reimbursement rates is known as the annual “doc fix.” Without such a fix, doctors would face a 21% Medicare pay cut from the health care reform bill.

Senator Debbie Stabenow (D-MI) introduced S. 1776 as a standalone bill, which Senate majority leader, Harry Reid (D-NV) said “was a necessary step.” Critics of the bill however believe that this will hurt the overall fiscal responsibility of health care reform. Senate Budget Committee Chairman Kent Conrad wants to establish a commission to develop a longer-term solution to the doctor payment formula as well as other recurring budgetary problems.

Part of the issue involves the sustainable growth rate, the mechanism Congress adopted in the 1990s to try to ensure that the amount Medicare pays for annual doctor care of each beneficiary doesn’t grow faster than the overall economy. With Medicare projected to go bankrupt in 2017, obviously this plan did not work.

Not only have costs for doctors per beneficiary shot up, health care spending now takes up over 16% of the U.S. economy. To address this issue, the House bill would get rid of the sustainable growth rate, while the Senate Finance bill increases payments by 0.5 percent in 2010 at a cost of $10 billion, but it would leave doctors facing a 25 percent cut in 2011.

Opposition to the bill came from Senate Minority Leader Mitch McConnell, according to the Dow Jones Newswires, who said today that S. 1776 was specifically left out of the health care bill so that the Finance Committee could keep the total under $900 billion. Other critics, such as Senator Corker (R-TN), ranking member of the Senate Select Committee on Aging believed AMA’s actions were “throwing future generations under the bus, by in essence urging Congress to pass a quarter-of-a-trillion-dollar spending bill, unpaid for.” He even went as far as saying that:

“The A.M.A. is engaged in basically one of the oldest professions in the world: selling the support of its body.”

J. James Rohack, president of the American Medical Association (AMA), said that it would be very difficult for doctors to support the broader Senate healthcare legislation if there were no effort to address long-term cuts to Medicare payments.

 

Ultimately, with the issue of reimbursement having such a tremendous impact both on physicians, patients, and the overall cost of health care reform, Congress needs to consider how America is going to pay physicians to treat more insured people, especially if a public option comes into play. The idea of cutting payments to doctors while adding more people into the health care system, which is already short of providers, creates almost no financial incentive for doctors to continue treating patients. While Congress is trying to figure out how to pay for health care reform, who is going to figure out how to pay your doctor enough to stay in business?

American medical associationDebbie StabenowDoc Fixlong term pay cutsMedicare pay cutNEWphysician pay
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