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House averts ‘fiscal cliff,’ forestalls 26.5% Medicare physician payment cut
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The U.S. House of Representatives on Jan. 1 passed bipartisan legislation 257-167 that included a 1-year delay in Medicare physician payment cuts.
The 26.5% payment cut had been scheduled to take effect Jan. 1.
H.R. 8, the Job Protection and Recession Prevention Act of 2012, amends the Economic Growth and Tax Relief Reconciliation Act of 2001. It increases the income tax rate for workers earning more than $400,000 annually and extends unemployment benefits. A 2-month delay to a 2% pay reduction for all Medicare physicians mandated under a 2011 deficit reduction law was also included.
The American Optometric Association supported the 1-year reprieve in the Medicare physician payment cut, it said in a statement sent to members.
The cut stems from the sustainable growth rate (SGR), a key factor in annual Medicare payment updates designed to limit spending. A number of medical societies have called for the SGR to be altered or repealed.
“The 1-year Medicare physician payment patch was offset partly through $22 billion in payment reductions to other Medicare providers, including hospitals, pharmacies and dialysis clinics,” the AOA said in its statement.
The group credited its advocacy efforts with preventing optometrists from being targeted.
“While the immediate Medicare pay crisis has been averted for now, the 1-year SGR fix and the 2-month sequester signals the start of a new effort to prevent future Medicare pay cuts and finally fix Medicare’s broken payment formula,” the AOA said.
“This last-minute action on the part of Congress is a clear example of how the Medicare program is increasingly unreliable for physicians and patients,” Jeremy A. Lazarus, MD, AMA president, said in a news release. “This instability stalls progress in moving Medicare toward new health care delivery models that can improve value for patients through better care coordination.”
Congress has voted several times in recent years to forestall the Medicare physician payment cut.
“Overall, Medicare payments to optometrists in 2013 will have increased by about $450 million since 2004,” the AOA said in its statement to members. “This represents a 74% increase in Medicare payments to optometrists during a period when the annual SGR update has remained essentially flat. Medicare’s higher valuation of medical eye care services provided by optometrists means that payments to ODs have increased 37% more than for physicians generally over the last decade.”
In a statement released by the White House, President Barack Obama addressed the importance of compromise with regard to Medicare.
“I agree with Democrats and Republicans that the aging population and the rising cost of health care makes Medicare the biggest contributor to our deficit,” he said. “I believe we’ve got to find ways to reform that program without hurting seniors who count on it to survive. And I believe that there’s further unnecessary spending in government that we can eliminate.”
The final tally on the House legislation included 172 Democratic votes and 85 Republican votes in favor of the bill; 151 Republicans and 16 Democrats voted against the measure.
The Senate passed amendments to the bill Dec. 31, 2012, by a margin of 89-8. – by Matthew Hasson and Nancy Hemphill, ELS