Congressional stopgap prevents Medicare fee cuts

April 2, 2014

On March 31 the United States Senate passed a bill, by a vote of 64 to 35, that will avert a threatened 24% cut in reimbursements to physicians who treat Medicare patients. The House, via a somewhat questionable voice vote, had approved similar legislation a few days before, and President Obama is expected to sign it into law soon. The $21 million appropriation will be paid for with cuts to healthcare providers, to be phased in over the next ten years. The measure, which is the seventeenth temporary “patch” to the Medicare payment formula to be applied by Congress since 1997, is seen by many as a stopgap, designed to prevent a chaotic situation, but also a way of avoiding, for now, a more permanent repair of the payment formula. In fact, many legislators opposed the latest “doc fix” on the grounds that it will stall the momentum for a permanent solution.

According to an Associated Press story, “there is widespread agreement on bipartisan legislation to redesign the payment formula that would give doctors 0.5 percent annual fee increases and implement reforms aimed at giving doctors incentives to provide less costly care.” The obstacle to a far-reaching agreement however, seems to be disagreement over how to pay for the cost of jettisoning the old formula—which is estimated at approximately $140 million. Read a comprehensive report from ABC news.

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