Senate Finance Committee Chairman Max Baucus says his panel will consider so-called “doc fix” legislation to repeal the rate formula used for physician reimbursement under Medicare when lawmakers return to Washington in December.
The Montana Democrat sent out a notice Thursday to fellow committee members announcing they will meet in “open executive session” on Dec. 12 “to consider an original bill to repeal what is officially known as the Medicare Sustainable Growth Rate (SGR) formula.”
The legislation that Baucus will offer will be distributed 48 hours before the start of that meeting.
However, there remain significant stumbling blocks to any major overhaul of the doc fix — including how to pay for it — even as bipartisan support for repeal has gained momentum.
Unless Congress acts by Jan. 1 in some manner, Medicare physician payments will be cut by about 24.4 percent.
At the root of the problem is that the SGR formula enacted in 1997 as a way of controlling Medicare spending established a fee schedule with calculated annual updates for more than 7,000 physician services under Medicare. But as the economy began to slow and health care costs began to outpace gross domestic product growth, the formula produced decreases in physician fees each year, starting in 2002.
Over the past 10 years, Congress has spent nearly $150 billion on short-term SGR patches or “overrides” to prevent such cuts, either by increasing physician payment rates or freezing rates to prevent decreases. But each year that has produced uncertainty for physicians about whether or when their Medicare reimbursements will be cut.
On Oct. 31, Baucus and Finance Committee ranking member Orrin Hatch, R-Utah — joined by House Ways and Means Chairman Dave Camp, R-Mich., and that panel’s top Democrat, Rep. Sander Levin, D-Mich. — released a “discussion draft outline” on permanently fixing the SGR. That draft called for an SGR repeal that would include a 10-year freeze and a performance-based incentive program starting in 2017.
While Baucus is now moving forward with his version of a bill, Camp’s committee in the House continues to take “the feedback from the draft released last month and [is] evaluating comments,” said an aide.
It remains uncertain how any permanent SGR fix, or another temporary one, might ultimately be approved this year, either as a stand-alone item or part of a larger budget bill possibly being worked out by a bipartisan budget conference committee.
It also is not clear where budget offsets might be found to pay for a permanent repeal. The Congressional Budget Office estimated earlier this year that it would cost about $139 billion over 10 years, which was lower than previous CBO estimates.