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  • Congressional Gimmicks leave Doctors and Taxpayers in a Lurch

    The Senate voted 45-52 yesterday to oppose the $140 billion so-called “extenders bill” (HR 4213). The Hill is reporting that Sen. Max Baucus (D-MT) is going to offer a slimmed down version for consideration as early as today. Two key health provisions of the bill are expected to be a continued bailout of state Medicaid programs and a temporary Medicare ‘Doc Fix’.

    The Sustainable Growth Rate (SGR), initiated in 1997, links the increase in Medicare reimbursement rates to growth in GDP. Since medical costs historically increase at a rate more than twice GDP, the SGR reduces the real payments physicians receive. A temporary “fix” has happened nine times in nine years to increase Medicare rates above SGR levels. Temporary fixes are the easy way out for politicians because they appear less costly to budget.

    The Hill reports that Senator Baucus is going to use a budgetary trick by paring down the “doc fix” from 19 months to 6 months. Of course, this means that the budgetary cost of the bill will appear smaller, but in reality the only difference is that Congress will have to revisit this issue in 6 months instead of 19 months – kicking the can down the road once again.

    Instead of providing a permanent fix to this on-going problem, the President and Congress decided to prioritize increasing spending on Medicaid expansion and on subsidies for insurance in the Patient Protection and Affordable Care Act. A permanent Medicare doctor fix was not included in the final legislative package because it would have added $300 billion to the ten-year cost estimate. So, doctors were left, yet again, to depend on the uncertainty of continued temporary fixes for the problem.

    The real national problem, however, is that the President and Congress are so willing to spend today at the expense of our country tomorrow. They are increasing our debt to such a great amount that our country is at a heightened risk of reduced future prosperity.

    The following figure shows the growth in federal spending between the years 2000 and 2010. Between 2000 and 2010, federal expenditures have more than doubled from $1.8 trillion to $3.7 trillion. In the first two years of the Obama Administration, Congress has increased federal expenditures by 25 percent. And yet even with this stunning rise in government expenditures the President and Congress tell us we must spend more and more.

    Consider that a permanent doctor fix would cost about $30 billion per year or about three-quarters of one percent of federal expenditures. If this is a priority for our nation’s leaders, then they should find $30 billion to cut elsewhere and avoid laying the burden for this additional spending on future generations with more deficit financing. This should actually not be that hard since – as the table indicates – federal expenditures have increased by over 30 times this amount in just the past three years.

    Adjusting the doctor reimbursement rates is necessary to avoid reimbursement cuts and limits to patient access. However, fiscally responsible members of Congress should insist that the PAY-GO rules apply and that an equivalent amount of other federal spending is reduced now to pay for the fix. An amendment introduced by Senator John Thune includes most of the central provisions of the Baucus bill – except for the continued Medicaid bailout. And it does so with common sense measures – such as $38 billion from cutting unobligated stimulus funds and $15 billion from selling certain government properties – that actually would produce a bill that reduces the deficit. Bundling the ‘doc fix’ with measures that reduce the deficit is certainly the direction the Senate should go to preserve access while maintaining fiscal prudence.

    Posted in Obamacare [slideshow_deploy]

    11 Responses to Congressional Gimmicks leave Doctors and Taxpayers in a Lurch

    1. kevin s texas says:

      how can the U.S Senate forget about the heart and soul of this country….THE PEOPLE…..I never asked for this “being on unemployment”…I would take a job in a heart beat if I could only find one!!!!Why is that?Is that because the same people that screwed the this country up…Our now deciding that the 90 million americans effected Do not matter anymore?Yes people 90 million….If you figure that for every 1 person filing for unemployment at least 5 are affected within every house hold “give or take” but either way it’s the facts!!!I hope today there will be some justice for the REAL victims of the economy ….At least I will continue to pray for it!

    2. D R, DC says:

      What makes the "doc fix" so bloody important that other spending should be cut to make room for it?

      Can anyone imagine Heritage calling for a "janitor fix" whereby we cut spending elsewhere to make room for increasing their pay?

      Get real.

    3. John, Buffalo NY says:

      For far to long, healthcare reimbursement in the Buffalo area has been among if not the lowest in the nation. I have worked all my adult life in healthcare and watched as everyone balanced their budgets on the backs of healthcare with continued reductions. There are more and more mandates for practices to maintain the highest standard of care and up to date equipment, but it becomes virtually impossible to do this in this continued declining reimbursement environment. One of the greatest contributors to the rising cost of healthcare, beside the aged population, is self referral to high cost services such as MRI, CT PET/CT and Nuclear Medicine. Stop self referral and you probably would reduce the cost of high end imaging by more than 30%. The doc-fix is critical to allowing imaging centers to be able to maintain the ability to care for Medicare patients. Should this not get fixed, over 90% of all Medicare paid for services in imaging would be at a loss so how could anyone care for Medicare patients? Get this done today and for good!

    4. Pingback: » Financial News Update – 06/17/10 NoisyRoom.net: The Progressive Hunter

    5. William Vero Beach Florida says:

      The reason there needs to be a “Doctor Fix” lies in the fact that the federal government sets the price of all medical services by determining the “Medical Allowable” charge for every given service. Once that overall fee is set, the Balanced Billing Restriction prevents doctors who participate in Medicare from charguing over the Medicare Allowable fee. The SGR automatically cuts that fee by 22%.

      Because close to 60% of the fee goes to overhead (paying office staff, the lease on an office, medical malpractice insurance, etc) that 22% can only come from the “profit” of 40% which typically makes up the doctor’s salary. That is assuming that there is no bad debt and that everyone pays their copays or has secondary insurance. The reality is that 30% of patients in a typical practice don’t pay their share…the net effect is doctor salaries will drop by 40-50% and may soon be below the salaries paid in other countries such as Canada. I am alrady getting calls from “head hunters” about jobs in other countries that guarantee salaries close to what I currently make in a Medicare predominant private practice in the US. With these cuts, those jobs will be much higher paying..

      Even if a physician goes “non-par” with Medicare, the Balanced Billing Restriction prohibits billing more than 115% of the Medicare Allowable fee. In a community sych as where I practice, the SGR cut will have the effect of making the reimbursement from Medicare per service less than my overhead cost of seeing the patient. As 85% of the people in my community are on Medicare, this would have one result…closing the practice because it would no longer be financially viable.

      In other parts of the country, where Medicare may only make up 35% or so of the population, doctors will be forced to refuse Medicare patients much as they currently do Medicaid in most states. Because many private insurance companies reimburse based on the Medicare formula, they, too, will be cut by this. The net effect is going to be a surge in concierge and cash only practices. Access to healthcare is going to be more restricted even for those who have insurance as this trend accelerates.

    6. DP Texas says:

      I read the posted comments on the "doc fix" issue in the wake of watching over five clinics in my area go under. Hospital systems and others are swarming like buzzaeds to buy out struggling physicians who are desperately trying to keep their doors open. We have endured massive lay offs,our benefits have but cancelled, and the media puts out the message that healthcare is the place to be for jobs… WRONG.

    7. PJ Ft Worth, Tx says:

      John in Buffalo is absolutely correct. DR of DC is fairly typical of those misinformed about health care and healthcare providers. I have also worked in healthcare for 30 years and I have seen all physician and technical reimbursements in my field decline by 30-70%.It is becoming almost impossible to conduct business and meet payroll, pay taxes, and purchase supplies and pay bank loans in the current environment. Because provider enrollment in other conventional insurance plans in this state and physician licensure in other states is tied to Medicare/Medicaid participation, it is virtually impossible to”drop Medicare”if one plans on continuing as a healthcare provider. Other insurance reimbursements are”tied to Medicare”which means that one is paid at Medicare rates ,although some rates range from slightly below to slightly above Medicare rates. Self referral is a huge issue which Congress completely ignores and insurance companies”remedy” by cutting everyone’s reimbursements. Regulatory and accreditation requirements of CMS and Insurance companies increase in complexity and cost annually.Also, the number of youthful individuals who have sought and obtained SS disability and Medicare access at taxpayer expense(typically through Workers Compensation “injuries” or long term drug use scenarios) appears to have increased dramatically in recent years,although I suspect in another era of greater personal or moral responsibility these folks would be more productive memebers of society instead of increasing the Medicare funding burden.

    8. Bobbie Jo says:

      Government creating problem after problem.

      The media advertises healthcare is the place to be for jobs, neglect to specify jobs under obamacare (government) where everybody's health will be everybody's business and somebody's health will be compromised for another, where a select will benefit greatly while others will be rationed unfairly.

    9. Joani , Texas says:

      The Bush Administration is the one that put us here, and I dont think the Republicans were concerned about the deficit and spending during that time. Now We The People need a bailout and you want to worry about the deficit. It should have been a concern instead of bailing out the Banks, or even Haliburton. You need to rethink you're position. The H. R. 4213 money will go right back into the economy for necessities. Shame on you for turning your backs on the ones who voted for you and will vote against you in November. We need to lay off all senators and start over with new ones who put America and Americans first.

    10. John White MD says:

      Good luck finding a doctor to see you when you turn 65.

    11. Bobbie Jo says:

      Joani , Texas,

      you write "The Bush Administration is the one that put us here, and I don't think the Republicans were concerned about the deficit and spending during that time.

      The current president spoke feverishly on "change." He knows where to put the "change" as he adds discriminate burden on some, increasing the problems. Why hasn't and isn't the current president attempting rational "change" to anything everyone complains is BUSH'S FAULT!!!! ???????

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