Congress delays 5% cut in Medicare physician payments

In a last-minute flurry of activity before adjourning for the year, the U.S. House and Senate passed legislation to delay a proposed 5% cut in Medicare physician payments for 1 year, freezing the conversion factor at the 2006 level, according to a press release from the American Medical Association.

The legislation did not address cuts specific to orthopedics due to changes in practice expense and work relative value units (RVUs), which will still go into effect in 2007. However, the legislation sets aside funds to avert cuts in 2008, and stops additional Medicare cuts to rural physicians, according to the AMA release.

As reported by Orthopedics Today in November, the final rule issued by Medicare increased the work component for the RVUs for evaluation and management services. CMS officials say that the change would pay physicians more for time spent with patients and encourage them to spend more time assessing patients' health status and educating them.

The last-minute legislation, the Tax Relief and Health Care Act of 2006, included implementation of a quality reporting system for physician services. Beginning in 2008, hospitals must report on patient satisfaction and risk-adjusted outcome measures to receive full inpatient payment updates. The final rule also includes three new measures from the Surgical Care Improvement Project, which relate to the care process for beneficiaries undergoing surgical procedures.

In addition, the bill established a Medicare reporting program for 2008 under which physicians can report on quality or structural measures, including those related to the use of health information technology.