Medicare Physician Reimbursement Short Term Fix Proposed

April 15, 2008

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On April 11, 2008, the American Academy of Neurology Professional Association (AANPA), along with other physician specialty groups, met with US Senate Finance Committee Chair Max Baucus (D-MT) to get an update on his plans to prevent a pending cut in Medicare payments. Without congressional action, physician reimbursement under Medicare will be cut 10.6 percent on July 1, 2008 and another five percent on January 1, 2009.

Sen. Baucus stated that he will be drafting legislation that would provide an 18-month fix to stop the payment cuts, continue the physician quality reporting program, increase payments to primary care providers, and realign the Relative Value Update Committee (RUC), which he said lacks balance.

Commenting on Sen. Baucus's plan to only provide an 18-month payment fix, former AANPA Legislative Affairs Committee chair Mark Yerby, MD, MPH, of Portland, OR was disappointed. "This is never ending," said Yerby. "How long are we expected to go to Congress and ask them to provide access to care for Medicare beneficiaries?" Yerby did agree, however, that the AANPA and other specialties should support the 18-month fix at a minimum.

Passage of legislation is uncertain. Baucus pledged to push a bill through Congress, but was unwilling to share any information on how to finance an 18-month fix. The cost of sustaining current physician reimbursement rates is estimated at $8 billion, while a comprehensive multi-year fix would cost $40 billion, and the elimination of the current formula that determines physician reimbursement could cost as much as $288 billion.

Senator Baucus said he expects action in the Senate by mid-May to prevent the July 1 cut.

For more information, please contact AANPA Legislative Counsel Mike Amery at mamery@aan.com.