Medicare Physician Pay Cut Looms Again

With less than two months before the current Medicare pay patch expires, all ears are on Congress as physicians and physician advocates anxiously await to hear encouraging news from Capitol Hill. Are physicians looking at a massive cut to Medicare payments before year end, or will Congress intervene once again?

Congress is fairly quiet right now and will probably remain so until after the November 2 midterm elections, although there was a bit of scurrying before the Oct. 8 adjournment.

On June 25, President Barack Obama signed the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010 to forestall a 21 percent pay cut and provide physicians with a 2.2 percent positive update to Medicare payments. Unfortunately, that increase has an expiration date. Physicians are now looking at a 23 percent cut in their Medicare payments beginning Dec. 1 and another 6.5 percent pay cut Jan. 1, 2011.

The U.S. Senate is considering proposals for another temporary pay patch, according to the American Medical Association (AMA). One of the proposals being considered would extend the current 2.2 percent payment update for the remainder of 2010 and give physicians an additional 1 percent increase in 2011. However, barring further Congressional intervention, the sustainable growth rate (SGR) formula would go into effect in 2012 and payments would be cut by an estimated 33 percent.

Other legislation would do away with the SGR formula entirely. Sen. Blanche Lincoln (D-Ark.) introduced a bill Oct. 4 that would repeal the current Medicare physician SGR payment system and provide physicians with annual updates.

The Medicare Rural Physician Recruitment and Retention Act of 2010 would base pay rates on what is considered by many a more accurate measurement of increased care costs, known as the Medicare Economic Index (MEI), rather than on the nation’s gross domestic product. The AMA and other physician groups have been advocating the MEI payment system for years.

Other provisions of the bill would adjust Medicare rates on a geographical basis to benefit rural states and increase the number of medical residency training slots supported by Medicare by 15 percent.

As Congress is adjourned until Nov. 15 and a holiday recess follows soon after, it is unlikely this bill will be considered before next year. With such a small window of opportunity, it’s more likely physicians can expect a repeat performance of last June.


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7 Responses to “Medicare Physician Pay Cut Looms Again”

  1. Kathleen F says:

    And we wonder why fewer and fewer of the physicians coming out of school are PCPs. You are worried about a nursing shortage; we need to start looking at the possibility of a PCP shortage – and especially those who accept Medicare/Medicaid in the very near future!

  2. B Szampruch says:

    This is so exhausting to deal with. The past 2 years we’ve had to go back and follow up on claims where we need to recoup extra money from Medicare. The labor time involved is lengthy. I think the government counts on the fact that many billing employees don’t necessarily have the know-how to go back and get the payments. This gives them the opportunity to keep their money! It’s amazing that the government doesn’t have to follow their own rules and regulations when it comes to making payment. They make the rules as they go and it always favors them. Why is it that other companies that provide labor services to individuals can increase their service charges and be able to profit but physicians who are saving individual lives have their pay taken away (not even profits now!)? Any profit they get ends up going back into practice for overhead such as equipment repairs and payroll just to keep the doors open. Does the government really think that our intelligent physicians will continue practicing much longer? Who will take care of us in the future and what will be the quality of the remaining physicians still practicing? I have already heard that many interns regret their career choice.

  3. S. Thompson says:

    Still fearing Medicare………… When will this end, when physicians stop taking Medicare. My PCP has already stopped taking Medcaid, next it will be Medicare.

    Our Non-profit hospitals and University Medical Centers will be flooded with Medicare patients especially in the OP Chemotherapy Infusions Centers. Private practice will not be able to treat the Medicare patients without co-ins, drugs are costing more than the reimbursement.

    Still fearing Medicare……………

  4. Donna H says:

    What I would like to know is…. how many of our elected officials on Capital Hill would be willing to continud to do their work on a daily basis and take a 33% wage cut for their trouble!!!!!

  5. Anth says:

    I am reading emotion and fear in the comments section. The reality is that Medicare cannot sustain itself very much longer. The federal government is going broke, and baby boomers are retiring by the thousands each day. We are in for MUCH TOUGHER times than in the past couple of years.

  6. Kristi May CPC says:

    Ah yet again scare tatics from the government. Isn’t this hard to believe? The sad thing is during elections this is not going to be top priority. As far as I can tell it is not even being discussed by the candidates. If control of the house is shifted does this again become another bargaining issue? Healthcare for the elderly should never be used as a political gain or with held for bargaining.

  7. Marlee says:

    This is why good physician practices are closing or selling. I am very glad to be out of medicine!!! Good luck to those who continue to provide good service.

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