AMA Begins ‘Last-Ditch’ Effort To Convince Congress To Address Medicare Payments

The American Medical Association on Nov. 19 launched a "last-ditch" effort to convince the Senate to agree to a provision in a House-passed bill (HR 5063) that would allow the Bush administration to address the Medicare physician reimbursement rate, CongressDaily reports. Provider groups and other health advocates have been urging Congress to reverse Medicare provider rates that are scheduled to be cut 4.4% in January, on top of a 5.4% payment reduction imposed earlier this year (Rovner, CongressDaily, 11/19). The House last week approved an unemployment benefits bill with a provision that would give CMS the authority to "fix problems" with the Medicare reimbursement formula for doctors. The provision does not, however, provide physicians with any funds or reverse the payment cut. The Senate approved a similar overall bill, but it does not include the Medicare provision. Legislation that would have increased Medicare provider payments has been "bogged down" because the Bush administration and Congress disagreed over increased funding for HMOs, hospitals and other providers, priorities the administration does not support. In June, the House passed a $30 billion Medicare reform bill that included provider giveback provisions and a prescription drug benefit, but the Senate has failed several times to pass similar legislation (Kaiser Daily Health Policy Report, 11/15). AMA President Yank Coble said, "Senate inaction is unacceptable. Any additional delay in addressing these harsh, unintended cuts puts Medicare patients at great risk." Senate Finance Committee Chair Max Baucus (D-Mont.) said that even though senators appreciate the "urgency" of the physician fee cut, they are hesitant to correct it without addressing the needs of other providers, CongressDaily reports. "Other providers don't want the train leaving the station without them," Baucus said.

Issues with the Medicare Provision
There are concerns about how much it would cost the federal government if CMS decides to address the provider payment formula, as the Congressional Budget Office recently changed its estimate that such as provision would cost nothing. In a recent letter to Senate Budget Committee Chair Kent Conrad (D-S.D.), CBO Director Dan Crippen said his office originally assumed that the House provision would not actually give CMS "any additional legal authority to modify the physician fee schedule," meaning that there would be no change to the formula. Crippen added, however, "there are growing indications that the administration would use this provision as the basis for raising the rates for Medicare payments to physicians," a move that would cost $43 billion over 10 years (CongressDaily, 11/19). Health care lobbyists still intend to press for "giveback" legislation next year, but they say it may be a "hard sell" in a Republican-controlled Congress because of competing priorities, Boston Globe reports. Incoming Senate Finance Committee Chair Charles Grassley (R-Iowa) said he will examine the Medicare payment issue next year, as well as financial aid for rural hospitals (Kirchhoff, Boston Globe, 11/19).