Permanent ‘Doc-Fix’ Looks DOA for 2013

a doctor tends to a patient in the US health care system
National Journal
Clara Ritger
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Clara Ritger
Dec. 5, 2013, 4:29 p.m.

Des­pite bi­par­tis­an sup­port, Con­gress is un­likely to pass a per­man­ent “doc-fix” by the end of the year, ac­cord­ing to an of­fi­cial in the House Ways and Means Com­mit­tee. But law­makers need to get a patch in place soon to pre­vent a 20 per­cent cut to phys­i­cians’ pay on Jan. 1.

While the goal with­in Con­gress is still a long-term fix, the of­fi­cial said, the real­ity is that the House will meet for four more days be­fore ad­journ­ing un­til next year.

Just be­fore the Thanks­giv­ing hol­i­day, the Cen­ters for Medi­care and Medi­caid Ser­vices un­veiled a 20 per­cent cut to 2014 doc­tor’s pay­ments for Medi­care ser­vices.

While the cut — and the time Con­gress has left to stop it — seems omin­ous, the like­li­hood of it hap­pen­ing is small. It’s a dance Con­gress does each year after CMS an­nounces the cut, which a 1997 law re­quired in or­der to keep fed­er­al spend­ing in check with fed­er­al in­come.

Since 1992, the gov­ern­ment has is­sued pay­ments to phys­i­cians to cov­er the cost of care for Medi­care be­ne­fi­ciar­ies. In 1997, CMS ad­op­ted the Sus­tain­able Growth Rate for­mula, which helps lim­it fed­er­al spend­ing on Medi­care. It en­sures the yearly in­crease in ex­pendit­ures does not ex­ceed GDP growth. As a res­ult, phys­i­cians who re­ceive re­im­burse­ments for ser­vices to Medi­care pa­tients have been sub­ject to an­nu­al cuts, but each year Con­gress comes up with a “doc-fix” to raise pay­ments, push­ing the cuts back to be dealt with in fu­ture budget cycles. Con­gress has passed 15 “doc-fixes” since 2003, adding up to a grand total of $150 bil­lion.

This year, a per­man­ent re­peal-and-re­place solu­tion gained trac­tion on the Hill be­cause the Con­gres­sion­al Budget Of­fice es­tim­ated that it would cost $175.5 bil­lion over 10 years, sig­ni­fic­antly lower than in pre­vi­ous years.

It is un­clear wheth­er delay­ing the per­man­ent “doc-fix” un­til 2014 would af­fect that cost es­tim­ate.

Lead­ing med­ic­al as­so­ci­ations, however, say the cost is worth it giv­en the long-term sav­ings.

“If we elim­in­ate the fisc­ally fool­ish SGR once and for all, it would cost less than all 15 of the pre­vi­ous patches that Con­gress has put in place over the last dec­ade,” said Ar­d­is Dee Hov­en, pres­id­ent of the Amer­ic­an Med­ic­al As­so­ci­ation, in a press re­lease. “At stake are in­nov­a­tions that would make Medi­care more cost ef­fect­ive for cur­rent and fu­ture gen­er­a­tions of seni­ors. In­nov­a­tion re­quires sta­bil­ity and in­vest­ment: in­vest­ment in health in­form­a­tion tech­no­logy to help share in­form­a­tion at the point of care, in­vest­ment in staff to help co­ordin­ate care, and in­vest­ment in time for phys­i­cians to con­sult with each oth­er about a pa­tient’s care.”

Hov­en said they are op­tim­ist­ic that they’ll get SGR re­peal this year, es­pe­cially giv­en the fact that le­gis­lat­ors star­ted work­ing on it early, as op­posed to oth­er years when it was handled as a last-minute fix in the budget. But be­cause Con­gress is fa­cing a tight budget, it will have to look for how to off­set the cost.

Hov­en ad­ded that ac­cess to care could be­come “a real threat” if Medi­care pay­ment re­mains un­stable and Con­gress doesn’t get a per­man­ent solu­tion done soon.

“One out of four Medi­care pa­tients is hav­ing dif­fi­culty find­ing a primary care phys­i­cian in this coun­try,” she said. “If in fact they fail to re­peal [SGR], the sta­bil­iz­a­tion of the Medi­care pro­gram is at great risk.”

Mem­bers of the Sen­ate Fin­ance Com­mit­tee are next ex­pec­ted to dis­cuss the SGR over­haul Dec. 12. The le­gis­la­tion — sponsored by Com­mit­tee Chair­man Max Baucus, D-Mont. — will be re­leased two days pri­or. The House Ways and Means Com­mit­tee Chair­man Dave Camp an­nounced Thursday that if “real pro­gress” con­tin­ues on the bill, he ex­pects the com­mit­tee to mark it up next week.

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