Congress Punts, Freezes Medicare Fees for 10 Months

If you could express what Congress did on physician Medicare fees in sports terms, you might say lawmakers drove all the way to the 20-yard-line … and punted.

"It's irresponsible," said Texas Medical Association President C. Bruce Malone, MD.

Rather than seizing the opportunity to use leftover war money to scrap the Sustainable Growth Rate (SGR) formula that cuts physician payments and threatens to drive them out of the Medicare program, Congress did what it has done for 10 years – opt for a short term solution. It stopped the 27.4-percent cut scheduled for March 1 and froze fees at current levels for the rest of the year, meaning it will have to consider the issue again  by December and that a permanent fix – if it ever happens – will be even more expensive. The fee freeze is part of compromise legislation extending payroll tax cuts and unemployment insurance.

"Congress keeps calling it a 'Doc fix,' but they haven't done anything to fix it," said Dr. Malone. "Congress missed a great opportunity to solve the broken SGR formula once and for all."

The cost of this short-term patch is offset through reductions in several health care programs, including Medicaid disproportionate share payments to hospitals, Medicare bad debt payments to hospitals, federal Medicaid payments to Louisiana because of Hurricane Katrina, and the prevention fund created by the Affordable Care Act. Using savings from other health programs is not a good solution, Dr. Malone said, calling it a "Congressional shell game."

TMA, the American Medical Association, and others urged Congress to use money from Overseas Contingency Operations (OCO) – projected spending not needed as the wars in Iraq and Afghanistan wind down – to help pay for ensuring access to health care for the military and seniors. Doing so would allow Congress to "immediately repeal the SGR and to establish a pathway toward a truly sustainable physician payment system that focuses on improving quality and value for our nation's Medicare beneficiaries," they said in a letter to the chair of the House Ways and Means Committee.

"Using the OCO funds was the only solution Congress had to get rid of the SGR debt once and for all," Dr. Malone said. "The OCO funds were probably our only chance to repeal it. Congress showed their cards. They really don't care about doctors or Medicare patients. If they did they would have used the OCO funds. It's irresponsible. Now we are back in the cycle of one short term delay after another with no solution in sight. As a result, we all suffer – Medicare patients, physicians, our practices, and our employees. "

AMA President Peter Carmel, MD, said the AMA is "deeply disappointed that Congress chose to just do another patch – kicking the can, growing the problem and missing a clear opportunity to protect access to care for patients. Shortly after the coming elections, access to care for seniors and military will again be threatened by an even larger cut, and members of Congress will need to take swift action to end the broken formula." He added that "people outside of Washington question the logic of spending nearly $20 billion to postpone one cut for a higher cut next year, while increasing the cost of a permanent solution by about another $25 billion."

Susan L. Turney, MD, president and chief executive officer of the Medical Group Management Association, said Congress had chosen "political expediency over patients." She said physician practices "now face a mounting 35-percent payment threat from Medicare in 2013, and Congress has dug itself a $400 billion hole. Group practices are telling us that this congressional decision exacerbates an already unhealthy environment that limits their ability to plan for the future and balance their practice's fiscal health with their desire to continue to serve Medicare beneficiaries."

TMA is working for patients and physicians to create a Medicare system that is fair to all and preserves access to care. Visit TMA's Medicare Meltdown Action Center to see what TMA is doing. And, to illustrate the impact Medicare fee cuts could have on patients in terms even a child can understand, TMA produced the "Grandma & the Big, Bad SGR" video. Feel free to share it with your members of Congress, colleagues, friends, family, patients, and staff.


Last Updated On

February 20, 2012

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