Deficit Cuts Must Include Medicare Reform

In a June 27 letter [PDF], TMA, the American Medical Association, and 110 other state and national medical societies told President Obama and congressional leaders that any plan to reduce the federal budget deficit must include reforming the Medicare physician payment system.

"Bypassing this issue or passing another short-term fix simply drives up the cost of a long-term solution," the physicians wrote. "Had Congress acted as recently as 2005, the ten-year cost of preventing future cuts would have been $48 billion. Today, it is estimated that averting currently scheduled cuts would cost nearly $300 billion over the next ten years. If Congress continues to follow the past practice of employing budget gimmicks to push cuts into the future, the cost will exceed $500 billion in only a few short years."

Unless Congress acts, payments to physicians are scheduled to drop 29.5 percent on Jan. 1. "There is unanimous agreement that cuts of this magnitude would result in serious disruptions for the nation's elderly and disabled populations and cannot be allowed to occur," the letter warns.

The groups added that Congress "should ensure that the necessary funding is provided, in a credible and fiscally responsible manner, to ensure beneficiaries' continued access to physicians. An agreement on the debt ceiling legislation provides the best – and perhaps only – opportunity to ensure stability in Medicare payments, ensure continued beneficiary access to care, and address the SGR (Sustainable Growth Rate) deficit in a fiscally responsible manner."

Action, July 5, 2011