Lawmakers took another step toward permanently repealing the perennially pesky "doc fix" this week, but payment-related hurdles need to be overcome before a new formula for reimbursing the providers who treat Medicare patients can be put in place.
A framework from the House Ways and Means and Senate Finance committees would freeze payments at their current levels until 2023 while alternative payment models are tested, and, starting in 2017, a "value-based performance" program would tie payments to the quality of treatment and other performance metrics, according to a preliminary version of a discussion draft provided by a lobbyist Wednesday.
The proposal appears similar in concept to one passed unanimously by the House Energy and Commerce Committee in July. Both aim to shift provider payments from fee-for-service—in which physicians are compensated based on the volume of patients they see—to quality-based payments.
Neither proposal includes any discussion of pay-fors, the stickiest part of finding a permanent solution. This year has seen unprecedented bipartisan cooperation on developing a permanent fix, but finding over $100 billion to pay for it has yet to be attempted. The Congressional Budget Office estimated the Energy and Commerce bill would cost $175 billion over 10 years.
Passing a permanent fix would remove a decade-old thorn from Congress's side. The Sustainable Growth Rate formula passed in 1997 to hold Medicare cost growth down began mandating payment cuts for providers in 2003. Since then, Congress has passed numerous patches to prevent doctors from seeing the steep reimbursement cuts. Lawmakers on both sides of the aisle support replacing the SGR with a new formula, but lack of agreement on the pay-fors has so far kept a deal out of reach.
The doc fix could be paid for as part of a bigger budget package, but early indications from the budget conference committee set up by Congress's last fiscal crisis are that a "grand bargain" is unlikely. Budget negotiators had their first meeting on Wednesday and are to report recommendations to Congress by Dec. 13.
The Ways and Means and Senate Finance committees are asking for feedback on their discussion draft by Nov. 12.
This article appears in the October 31, 2013 edition of NJ Daily.