Finding a physician who accepts Medicare has long been a challenge for aging Georgians, particularly when doctors have faced the threat of a deep cut in Medicare reimbursements year after year.
But late Tuesday night, April 14, Congress passed the “doc fix” bill, which will remove the annual specter of Medicare reductions and transform the way the government pays doctors for treating those patients.
“It’s by no means a perfect solution, but it does represent a step in the right direction,” said Donald Palmisano, executive director of the Medical Association of Georgia. “It does provide patients and physicians some stability for the next five years.”
Palmisano said the uncertainty over Medicare has forced some doctors to limit how many Medicare patients they could see and still make a profit overall.
“It causes stress in a physician’s practice, and ends up impacting access to care for patients,” he said.
In 1997, Congress passed a budget bill that contained a formula for slowing the growth of Medicare costs. Every year since -- sometimes more than once a year -- it has had to pass a stopgap bill to keep the cost-cutting provisions of the first bill from actually taking effect. But doctors never knew when they might get zapped. Indeed, the Senate voted Tuesday night just hours before a 21 percent reduction in reimbursements was to take effect.
Under the bill, the current reimbursement schedule will be replaced with small payment increases for doctors for the next five years. During that time, Medicare will transition to a new payment system. Currently, doctors are reimbursed under the “fee for service” model, in which they receive more money if they perform more procedures, order more tests, offer more services. The new system would focus on the quality and value of care, not just the volume of it.
Also of note: Medicare patients with the highest incomes will pay more for premiums. Starting in 2018, wealthier Medicare beneficiaries (individuals with incomes above $133,500, with thresholds higher for couples), would pay more for their Medicare coverage, a provision expected to affect 2 percent of beneficiaries.
Deficit will grow by $141 billion
The Senate voted 92-8 to approve the legislation, which the House had already passed 392-37. President Barack Obama said shortly after the Senate vote that he would sign the bill, calling it a “milestone for physicians, and for the seniors and people with disabilities who rely on Medicare for their health care needs.”
There’s enough in the wide-ranging measure for both sides to love or hate. “Like any large bill it’s a mixed bag in some respects, but I think on the whole it’s a bill well worth supporting,” Senate Majority Leader Mitch McConnell, R-Ky., said.
The bill will cost about $210 billion but only provides for about $70 billion to cover the cost. That means it will add about $141 billion to the federal deficit, the Congressional Budget Office said.
Consumer groups and organizations advocating for seniors also have expressed concerns that beneficiaries will face greater out-of-pocket expenses on top of higher Part B premiums to help finance the way Medicare pays physicians.
For doctors, the passage is an end to a familiar but frustrating rite. Lawmakers have invariably deferred the cuts prescribed by a 1997 reimbursement formula, which everyone agreed was broken beyond repair.
But the deferrals have always been temporary because Congress has not agreed to offsetting cuts to pay for a permanent fix. In 2010, Congress delayed scheduled cuts five times.
A small bump for docs each year
As passed, the bill will give doctors an 0.5 percent bump in each of the next five years as Medicare moves to its new payment system of quality vs. quantity.
The measure encourages better care coordination among providers for patients with chronic illnesses, ideas that experts have said are needed in the Medicare program.
House Energy and Commerce Committee Chairman Fred Upton, R-Mich., one of the bill’s drafters, has called it a “historic opportunity to finally move to a system that promotes quality over quantity and begins the important work of addressing Medicare’s structural issues.”
A “technical advisory committee” will review and recommend how to develop alternative payment models. Measures will be developed to judge the quality of care provided and how physicians will be rewarded or penalized based on their performance.
While the law lays out a structure on how to move to these new payment models, much of their development will be left to future administrations and federal regulators. Expect heavy lobbying from the physician community on every element of implementation.
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