Stabilizing Medicare Fees

Burgess Seeks One-Year Extension 

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Medical Economics Feature – September 2012 


Tex Med. 2012;108(9):37-39.

. 2012;108(9):37-39.

U.S. Rep. Michael C. Burgess, MD (R-Texas), filed legislation in July to extend Medicare physician payment rates for one year. He said the bill, HR 6142, would ensure continued access for Medicare beneficiaries and TRICARE recipients.

"By providing one more year of stability, we make a critical, initial step toward ridding ourselves of this problematic and inadequate payment system," said Representative Burgess, vice chair of the House Energy and Commerce Committee's Subcommittee on Health and chair of the Congressional Health Care Caucus.

"Allowing for a one-year extension now will prove early to our seniors, physicians, and health care providers that they are at the forefront of our minds and our legislative agenda, and we will not leave them uncertain about how the upcoming 'fiscal cliff' will impact their care."

Unless Congress acts before the end of the year, the Centers for Medicare & Medicaid Services (CMS) will cut overall payments to physicians by 27 percent on Jan. 1 because of the Sustainable Growth Rate formula (SGR), a formula Congress adopted in 1997. Its supporters said it would stop Medicare spending on physicians from increasing faster than the economy as a whole. Every year since 2003, Congress stepped in at the last minute to avert drastic payment cuts and replace them will small increases.

"As numerous fiscal deadlines create a potential collision at the end of this year, kicking the Sustainable Growth Rate provision of legislative relief down the road is dangerous. In order to guarantee a substantive, long-term plan, guaranteeing proper services for Medicare beneficiaries, doctors need to first be provided with payment certainty for 2013," Dr. Burgess said.

"Despite Congress' continual enactment of last-minute legislation to prevent these cuts from going into effect over the last few years, 11th-hour legislative maneuvers should no longer take the place of a stable and secure solution," said Dr. Burgess. "I have never seen so much progress made on this issue than this year, but Congress must have more time to work with stakeholders on crafting a permanent replacement. While this legislation will provide a one-year extension, Congress must continue to work toward a permanent fix that will solve the issue once and for all, and this bill provides that time."

Another threat to physicians' Medicare payments is the Independent Payment Advisory Board (IPAB), a 15-member panel appointed by the president that would recommend cuts in Medicare payment fees to physicians if federal spending on health care reaches certain levels. Creation of the board is part of the Patient Protection and Affordable Care Act the Supreme Court recently upheld.

 This spring, the House of Representatives acted to abolish IPAB by passing HR 5, the Preserving Access to Healthcare Act, by a vote of 223 to 181. However, news reports say it is unlikely Senate Majority Leader Harry Reid will ever call the bill to the Senate floor for a vote. And even if he did and it passed, the reports say, President Obama would veto it.

Representative Burgess said that the IPAB "encompasses all that is wrong with the Affordable Care Act," which he said will disrupt the practice of medicine.

"Along with many excesses and constrictions in the law, IPAB represents the worst of what is envisioned under the health care law," he said. "As a physician, as a member of Congress, and as a patient in my 60s, I am offended by the Independent Payment Advisory Board. IPAB is not accountable to any constituency and only exists to cut provider payments to fit a mathematically created 'target.'"

He added that IPAB "would have far-reaching implications beyond Medicare for all of our nation's doctors. IPAB throws the government into the middle of the sacred doctor-patient relationship with the power to influence prices, reimbursements, and access. Beyond controlling Medicare, IPAB's rationing edicts would serve as the benchmark for private insurance carriers' own payment changes. Because of limitations on what the control board can cut, the majority of spending reductions would come from cuts to Part B and Part D provider fees."

TMA joined 41 other medical societies in urging Congress to abolish IPAB. In a letter to congressional leaders, they contended that IPAB will only worsen problems caused by the SGR.

"It is estimated that it will now cost over $300 billion to 'fix' the SGR, and we clearly cannot afford the IPAB to become the next SGR," they wrote. "Today, the price tag for repealing the IPAB is relatively small, so Congress should seize this moment and repeal the IPAB now before the cost to do so becomes prohibitive, and access-to-care problems become acute."

Finally, they said, health care professionals "representing roughly 37 percent of all Medicare payments – including hospitals and hospice care – are exempt from IPAB cuts until 2020; thus, IPAB-directed cuts will disproportionately fall on physicians." Physicians already face fee cuts of more than 40 percent over the next decade and could be subject to double jeopardy from combined SGR/IPAB reductions if nothing is done, they added.

TMA supports eliminating IPAB because the issue of Medicare spending is too important to be left in the hands of an unaccountable board with decisions based solely on cost.

Meanwhile, CMS officials unveiled a 2013 Medicare fee proposal that could raise total Medicare payments to family physicians by 7 percent and fees for other physicians providing primary care by 3 to 5 percent, due mostly to a proposal to create new payment codes for outpatient discharge care management. However, payments to some specialists would decrease.

"Helping primary care doctors will help improve patient care and lower health care costs long term," said CMS Acting Administrator Marilyn B. Tavenner. 


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