Senate Approves Bill To Put Off 25% Cut in Doctors’ Medicare Pay
On Wednesday, the Senate unanimously approved by voice vote a bipartisan bill (HR 4994) that would delay for one year scheduled cuts to physicians' Medicare payments, blocking a 25% payment cut scheduled to take effect on Jan. 1, 2011, Reuters reports (Smith, Reuters, 12/8).
The House is expected to pass the bill before the end of the week. President Obama urged lawmakers to move quickly on the measure and promised to sign it (Alonso-Zaldivar, AP/San Francisco Chronicle, 12/8).
Details of Legislation
The new measure, which has been estimated to cost $14.9 billion over 10 years, would extend current Medicare reimbursement rates until 2012.
The Congressional Budget Office reported that the full package -- which includes extensions to several other expiring Medicare programs at an estimated cost of $4.6 billion -- is fully funded.
The bulk of its cost would be offset through changes to a provision in the federal health reform law related to health coverage subsidy overpayments.
Under the overhaul, certain low- and middle-income individuals and families in 2014 will be eligible for tax subsidies to cover their health coverage costs through the new health insurance exchanges.
Those who receive larger tax subsidies than they are eligible for must repay the federal government a portion of the subsidy -- up to $250 for individuals and $400 for families. The new bill would change the repayments to a sliding scale structure based on the income levels of recipients.
The legislation also would be funded in part by the Medicare Improvement Fund (California Healthline, 12/8).
Before the Senate vote, some Democrats raised concern about the bill's offsets.
Sen. Ron Wyden (D-Ore.) said that revising the exchange subsidies "would not be my first choice." However, Sen. Jay Rockefeller (D-W.Va.) said that it would be impossible to approve such legislation without offsets, adding, "You've got to take it out of something."
Long-Term Solution Still in Works
Obama and physician groups welcomed the Senate's passage of the bill and urged Congress to use the one-year reprieve to develop a permanent solution to the Medicare physician payment rates issue (Ethridge/Gardner, CQ Today, 12/8).
The current payment formula -- known as the sustainable growth rate formula -- was approved in 1997 and originally intended to lower costs by annually resetting physician payment rates. However, when the cuts are deferred, they accumulate and force lawmakers to scramble for "patches."
Although lawmakers often have said that they want a long-term fix for the SGR, they usually face challenges reaching agreements on how to fund such legislation (California Healthline, 11/19).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.