Medicare "Doc Fix" -- Groundhog Day Continues

The temporary fix to avert the 21% cut to Medicare physician payments expires on June 1 -- once again creating a dramatic threat to physician reimbursement.

The long-debated issue of fixing the flawed sustainable growth rate (SGR) payment update formula has now gotten more complex since the Congressional Budget Office (CBO) released an updated estimate on merely freezing the current Medicare payment levels. According to the updated CBO, a long-term payment freeze would cost $276 billion over 10 years, a figure that is more than 30% more than its estimate to adopt a similar measure last fall. The scoring increase is attributable to the improved economic outlook and an increase in the estimate in the volume of Medicare physician services over the next decade. This issue does not make any sense to the average American -- how can it cost $276 billion to keep physician reimbursement flat?

So now physicians (for the third time this year) are facing the 21% "cliff" if Congress does not again act to avert the cuts. Twice so far this year, Congress has extended the 2009 Medicare payment rates as it continues to debate a longer-term fix to the problematic update formula.

Democrats are working to pass a measure that would avert the cuts for up to 5 years, estimated to cost $89 billion. Members of the both the Senate and the House support such a fix but, so far, have not been able to agree on the "pay for" for such a fix which has created the issue.

This issue remains critical to the viability of many physician practices, and there are growing reports of practice and clinic closures due, in part, to this protracted debate along with persisting inadequacies in Part B drug reimbursement.

We need to get this SGR issue fixed -- hopefully for more than a short term fix so we can move onto other issues critical to patient access and reimbursement. We continue to work to urge Congress to exclude prompt pay terms from ASP in order to have accurate and consistent reimbursement of life saving treatments in the physician office and hospital outpatient setting as an urgent next step.