Senate Clinches 10-Month Medicare 'Doc Fix'

February 17, 2012

February 17, 2012 — The Senate today followed swiftly on the heels of the House by approving legislation that delays a jaw-dropping reduction in Medicare reimbursement to physicians from March 1 to January 1, 2013. The bill now goes to President Barack Obama, who is expected to sign it.

The measure also extends a temporary cut to the Social Security payroll tax paid by workers through 2012 as well as unemployment compensation benefits for the long-term jobless.

The House approved the bill this morning in a 293-132 vote. Within an hour, the Senate concurred, 60-36.

In today's legislative action, Congress averted a 27.4% reduction in Medicare rates set for March 1 that might have caused droves of physicians to stop treating new or even current Medicare patients, limiting access to care. While one crisis is over, however, another one is in the making because lawmakers must act later this year to prevent another rate reduction on January 1, 2013, that is expected to top 30%.

Organized medicine is chastising Congress for choosing not to permanently repeal Medicare's sustainable growth rate (SGR) formula for calculating physician reimbursement — the reason behind the massive cut. However, the Congressional Budget Office recently put the cost of eliminating the formula and merely freezing Medicare rates for 10 years at $316 billion, an amount that deters lawmakers from crafting such a long-term solution.

Although the measure approved by Congress spares physicians an outright pay cut, it nevertheless works to reduce their bottom line. The legislation freezes Medicare rates for the rest of 2012, even as practice expenses continue to rise. Physicians also endured a Medicare pay freeze throughout 2011.


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