Congress’s Medicare Deal Isn’t a Deal at All

Democrats and Republicans are touting a permanent “doc fix,” but they’ve yet to reach agreement on the hardest part: how to pay for it.

The opening session of the 113th Congress. (Rick Bloom)
National Journal
Clara Ritger
Feb. 6, 2014, 7:51 a.m.

Demo­crats and Re­pub­lic­ans are tout­ing a com­prom­ise that would re­peal a flawed for­mula that de­term­ines Medi­care phys­i­cian pay­ments, but for now it’s a deal in name only.

Law­makers in both cham­bers are plan­ning to in­tro­duce bi­par­tis­an le­gis­la­tion Thursday to re­peal Medi­care’s Sus­tain­able Growth Rate for­mula, a phys­i­cian pay­ment plan Con­gress passed in 1997 in the hopes of lim­it­ing spend­ing on the massive so­cial pro­gram. Since 2003, however, Con­gress has passed short-term patches to stop the cuts, a mad­den­ing an­nu­al tra­di­tion known as the “doc fix” that has come at a cost of roughly $150 bil­lion.

In an ef­fort to end the an­nu­al ex­er­cise, the bills law­makers are re­leas­ing Thursday would re­peal the SGR for­mula and would in­sti­tute five years of an­nu­al up­dates of 0.5 per­cent to Medi­care phys­i­cians’ pay.

But des­pite the bills’ bi­par­tis­an back­ing, law­makers have yet to agree on the thorn­i­est is­sue of the doc fix: how to pay for it.

Neither bill in­cludes meas­ures to off­set the spend­ing — a hole that could sink it among the Hill’s budget hawks. And as Con­gress de­bates where to cut or where to get new rev­en­ue to off­set the spend­ing, the deal’s bi­par­tis­an sup­port could splinter.

The Con­gres­sion­al Budget Of­fice is slated to do a cost es­tim­ate of the meas­ures Thursday af­ter­noon, be­fore they are form­ally un­veiled.

If it were to pass, the com­prom­ise le­gis­la­tion as cur­rently writ­ten would cre­ate a pro­gram and qual­ity meas­ures to eval­u­ate per­form­ance and re­ward pro­viders who im­prove health out­comes, and it adds in­cent­ives for care co­ordin­a­tion for pa­tients with chron­ic con­di­tions. Ad­di­tion­ally, it cre­ates a Phys­i­cian Com­pare web­site that Medi­care be­ne­fi­ciar­ies can use to make de­cisions about pro­viders, as well as to al­low out­side re­view­ers to eval­u­ate qual­ity of care.

This year’s round of phys­i­cian re­im­burse­ment cuts is set to take ef­fect in March, un­less Con­gress acts.

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