Sen. Baucus Outlines Medicare Bill; Plan Includes Reductions to MA Plans, Physician Fee Increases
Senate Finance Committee Chair Max Baucus (D-Mont.) laid out the "final, contentious details" of legislation that would halt a 10.6% cut to Medicare physician fees, among other provisions, CQ Today reports. Baucus plans to introduce the legislation on Friday.Earlier this week, Baucus outlined some provisions of the working measure, which is "[p]rimarily a Democratic product," according to CQ Today. The proposal would delay the physician fee reduction, which is scheduled to go into effect on July 1, and increase physician fees by 1.1% for the next 18 months.
The legislation also includes financial assistance for low-income beneficiaries enrolled in the Medicare drug benefit, an electronic prescribing initiative and a proposal to ensure pharmacies are paid by Medicare promptly for drugs they dispense to beneficiaries.
Offsets
The bill would cost $20 billion over five years, the majority of which would come from the physician fee increase, according to CQ Today. Baucus said that the offsets will come mostly from cuts to the Medicare Advantage program. The offsets include cuts to indirect medical education payments and so-called private fee-for-service plans under MA. The proposal also would limit use of a MA process called "deeming," under which private insurers force health care providers not explicitly enrolled in their plans to participate when beneficiaries in those plans visit them.
In a May 22 letter to lawmakers, HHS Secretary Mike Leavitt said that President Bush will veto any legislation that cuts payments to MA plans. Democrats have "pushed hard for such cuts" to MA, saying that it is "overpaid and damaging to traditional Medicare," according to CQ Today. MA plans, on average, are paid 117% what traditional Medicare pays (Armstrong, CQ Today, 6/5).
Republican Support
According to CongressDaily, "Baucus is hoping to entice Republican senators to his version of the legislation that is expected to include sweeteners for vulnerable GOP members." Senate Special Committee on Aging ranking member Gordon Smith (R-Ore.) and Sen. Olympia Snowe (R-Maine) have publically announced support for Baucus' legislation (Edney, CongressDaily, 6/6).
Baucus' measure has "attracted some Republican support, but not yet enough to obtain the 60 votes needed to invoke cloture and end debate on the legislation," CQ Today reports (CQ Today, 6/5).
Grassley Proposal, Reaction
Finance Committee ranking member Chuck Grassley (R-Iowa) on Wednesday revealed portions of a competing bill, which he plans to introduce after Baucus' proposal (CongressDaily, 6/6). Grassley's bill increases physician fees by 0.5% through 2008 and by 1.1% in 2009.
Grassley said the MA cuts in Baucus' proposal will "guarantee a presidential veto," adding, "Without saying whether the president's right or wrong, I can say this -- we've got to get things done by June 30, and that's going to make it impossible." Grassley said his proposal -- which will be revealed "soon" -- "can be signed by the president" (CQ Today, 6/5).
