January 15, 2015 -- Nearing the end of his term, Congress's top adviser on Medicare exhorted lawmakers to put an end to a widely disparaged budget mechanism that routinely threatens to slash doctors' pay from the big government health program.
Medicare Payment Advisory Commission Glenn Hackbarth, who will leave the post this year, noted that Congress has frequently overcome in other instances the same hurdle that has blocked a so-called permanent "doc fix." A bipartisan effort to overhaul the system of payments was scuttled last year due to disagreements over whether and how to offset its costs.
Savings drawn from Medicare have been used as offsets for other congressional objectives, including expanding medical insurance coverage through the 2010 health law (PL 111-148, PL 111-152) and reducing the deficit through the Budget Control Act (PL 112-25), Hackbarth said last week.
Cost-saving changes in Medicare policy also have covered some of the costs of the stopgap bills Congress has repeatedly passed in recent years to stall scheduled cuts in doctors' pay. A budget mechanism known as the sustainable growth rate (SGR) dictates now cuts in Medicare payments to doctors. There's broad bipartisan agreement that the formula, known as SGR, is flawed. Congress has acted 17 times to stop SGR from cutting doctors' pay, with the current patch (PL 111-93) expiring in March.
According to Hackbarth, "hundreds of billions" of Medicare savings have been applied to budget deals, doc fix patches, and the 2010 health law.
"Yet we never seem to have enough to pay for an appropriate payment system for physicians," he said at a recent MedPAC meeting. "That frustrates me to no end, and I am hopeful that the new Congress will at last come to grips with this."
The Congressional Budget Office (CBO) in November pegged the cost of a permanent doc fix at about $144 billion over a decade.
MedPAC members are finalizing this week the next set of formal recommendations to Congress regarding Medicare, the largest single purchaser of health care in the United States, with annual spending seen topping $600 billion. The recommendations will be made in the commission's annual March report.
Commission members have agreed to repeated suggestions made to earlier Congresses backing the need to a permanently overhaul of Medicare physician payments.
In the March 2014 report, MedPac, said there's an "urgent" need to repeal the SGR mechanism, saying that "after a decade of year-end legislative overrides, the policy is causing uncertainty for physician and other clinician practices."
The commission also noted that the seemingly perennial need to pass a doc fix takes a toll on Congress as well.
"The SGR also bogs down the policy process by focusing efforts on the yearly need to override negative fee schedule updates," it said.