Congress Holds Off Doc Pay Cut Through May 31

Janice Simmons and Cheryl Clark, April 16, 2010

Congress approved legislation on Thursday night that delays the looming 21% physician cut in Medicare reimbursements that had been in effect since April 1. The legislation extends the new period through May 31.

The House voted 289 to 112 to enact the bill that included the provision to postpone, at least temporarily, a reduction in physician payments mandated by the sustainable growth rate (SGR) formula. The Senate had approved the same bill several hours earlier in a 59 to 38 vote. The bill received some bipartisan support with 54 Democrats, three Republicans, and two Independents voting for the bill.

For the second time this year, the Centers for Medicare and Medicaid Services (CMS) agreed to step in and advise contractors to hold claims for medical services performed on or after April 1 for the first 10 business days of the month. That period ended Wednesday.

On Thursday, a spokesperson for CMS said the agency would start processing claims for medical services provided on or after April 1 at the new, lower reimbursement rate. However, this process cannot occur until CMS' processing systems are tested and updated for lower rates. Medicare contractors are required to pay these claims on a first in-first out basis.

Congress is expected to take up legislation to extend the current payment rate until Oct. 1. The House and the Senate have passed separate bills to achieve this extension; negotiations are continuing, though, about how it will be paid for.

Lori Heim, MD, president of the American Academy of Family Physicians, said on Thursday that her organization is happy with the extension, but disappointed with the timing. "It's really disappointing that we're doing this at beyond the 11th hour. It's an administrative nightmare to go back and collect co-pays and readjustments."

Heim is most concerned that Congress is being "short-sighted." What Congress is doing, she added, has undermined the confidence of physicians and will be counterproductive to all health reform issues."

"They are in an election year, and nobody wants to be seen as adding to the deficit. It's politically easier for them to keep putting off the doctors, rather than allocate $209 billion that it would take to do the permanent fix over 10 years."

Additionally, she said, the public doesn't seem to understand what's going on either. "It's unfortunate. Medicare is being blamed. But it's not Medicare at all. It's Congress. Medicare and the Administration get the bad rap, but this is clearly at the seat of Congress."

She said the next opportunity for physicians, who take Medicare patients, to opt-out or not participate in the Medicare program is June 1.

Many physicians across the country have threatened to stop taking Medicare patients if the SGR fix does not pass.

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