Reversing Scheduled Cuts to Medicare Physician Payments Would Cost $10B-$50B, CBO Says

The cost of reversing a scheduled reduction in Medicare's physician payment rate would cost between $10 billion and $50 billion over the next five years, according to estimates from the Congressional Budget Office, CQ HealthBeat reports. CMS is scheduled to reduce Medicare physician payments by 5% in 2006 unless Congress takes action to reverse the cuts, and lawmakers are considering a number of options for addressing the payment reduction. According to the CBO estimates, which are dated March 24, freezing physician payments at the 2005 level would cost about $27 billion over five years and $48.6 billion over 10 years. Meanwhile, CBO estimated that replacing the current sustainable growth rate formula for setting physician reimbursement rates -- a change recommended by the Medicare Payment Advisory Commission -- would cost nearly $50 billion over five years and $154.5 billion over 10 years. Extending through 2006 a 1.5% payment increase for 2004 and 2005 that was included in the new Medicare law would cost $9.7 billion over the next five years, according to CBO. In addition, increasing payments 1.5% in 2006 and another 1.5% in 2007 would cost $20.8 billion from 2005 through 2010. CBO also estimated that recognizing changes in the new Medicare law as "changes in law" for the purpose of calculating the SGR would cost $12.8 billion over five years and $46.1 billion over 10 years. Finally, CBO estimated that retrospectively and prospectively removing doctor-administered medications from the SGR would cost $46.5 billion from 2005 to 2010 and $114.2 billion from 2005 through 2015 (CQ HealthBeat [1], 4/15).

Video News Releases
In related news, the Senate voted unanimously on Thursday on a measure that would require federal agencies to include in their video news releases disclaimers that alert viewers that the government is the source of information. According to CQ HealthBeat, the Bush administration "has come under fire in recent weeks" for releasing videos promoting its policies without revealing the source of the information. The Senate's approval of a measure to change that practice, included in the fiscal 2005 supplemental spending bill (HR 1268), would prohibit the administration from using federal funding to produce video releases unless the videos include notification that they were produced by the government. The measure includes language that would exempt activities authorized by existing law to avoid "hamper[ing] the ability of the government to distribute legitimate educational and public health information," CQ HealthBeat reports. Bush on Thursday said that agencies should identify themselves as the sources of reports but added that it is "incumbent" on the broadcasters to notify viewers that the news stories were produced by the federal government (CQ HealthBeat [2], 4/15).