Fix for Medicare Payments Is Unlikely as 30% Cut Looms

Physicians once again find themselves staring at significantly lower Medicare fees for next year, based on the Medicare Sustainable Growth Rate formula.

Under a stop-gap law passed in June, doctors currently are receiving a 2.2% increase in Medicare payments—but only through Nov. 30. In the absence of Congressional action, that increase will be rolled back and the previous pay cut of approximately 21% will go into effect for the month of December.

For 2011, the proposed rule projects an additional 6.1% cut, starting on Jan. 1. “This means that under current law'that is, in the absence of additional legislative action—if a service is performed on Nov. 1 and Jan. 1, the payment for Jan. 1 will be about 30% lower” than the Nov. 1 payment, explained Ellen Griffith-Cohen, a spokesperson for the Centers for Medicare and Medicaid Services.

Associations and policy makers say that they expect Congress to once again address the pay cut before it goes into effect on Nov. 30. But there is a consensus that temporary fixes are not the answer.

The American Academy of Neurology has been very concerned with the SGR formula, said Rod Larson, the Academy's chief health policy officer. “We think it needs to be replaced and a permanent solution needs to be found.”

Mr. Larson said that the continuous short-term fixes create a lot of havoc and uncertainty for physicians and could discourage more and more doctors to stop seeing Medicare patients. Patients with Medicare make up 30% of neurologists' patient population on average, he estimated.

“We're going along with the rest of the medical groups to press Congress to address this issue; I think physicians' patience is wearing thin,” he said.

Meanwhile, both Democrats and Republicans in Congress are vying to be the party to fix the Sustainable Growth Rate formula. But there's doubt about any change in the Medicare payment system this year.

“I don't see anybody working on it hard enough right now to think that there's actually going to be a solution that's on the floor of the House right before or after the election. That's just not going to happen,” Rep. Michael Burgess (R-Tex.) said at a recent Congressional Health Care Caucus forum.

“We'll probably do some other temporary patch to get into the next Congress,” said Rep. Burgess, who is also an ob.gyn.