Friday, November 5, 2010

Dear Santa: I want a Medicare fix

Well it's that time of year again.

No, not Thanksgiving or Christmas, or even the venerable Interim Meeting of the AMA. It's the time that physicians nationwide anticipate another mandatory cut in Medicare reimbursement rates.

This time the recurrent temporary fix will result in a cut of 23.6 percent on December 1st. Assuming political gridlock the rate will fall another fraction of 6.5 percent on January 1.

History dictates that there will be lobbying, bluffing, puffing and even some "take my toys and go to my room" childish attitude but in the end Congress will create another "fix". In the past this has been to stabilize payment rates to a Victorian-era fee schedule (ok, 1997 or so) and set up an expiration schedule that again is measured in months.

But this year might be different. Or, at least it threatens to be.

American voters stampeded to the polls to vote out the status quo in favor of a new Republican House and a "lack of cloture" Democratically impotent Senate. Many of these new Republicans campaigned on the promise of fiscal responsibility (read: make the Bush tax cuts permanent and curb spending, including entitlement programs).

The Republicans have as a group pledged to cut $100 billion in January.

Now enter the AMA.

This association is again lobbying for a fix -- though now it is not the "permanent fix" but rather a tempered 13-month patch to give physicians at least a year to worry until the next SGR induced armageddon.

But will this new Congress support the AMA proposal? I don't think so.

Rumors abound to the cost of the AMA idea but it ranges between $17 billion to upwards of $20 billion. I'm certainly not an insider, but a new Republican congressman might find it challenging to explain to those tea party goers about why one of his first actions was to vote to support a double digit entitlement extension.

The other options are also mind stretching.

The lame duck Democratic controlled body could pass a 1 month extension and leave it up to the Republicans to spend the money in 2011. Or, they could use the pout strategy and just grind out the final month with the cut in place with Medicare physicians having to deal with a very arduous Christmas present.

So what will happen? It's anybody's guess but a likely outcome will be a compromise of sorts.

It would be fairly easy to disguise a three or four month fix as part of a January revenue bill to add some permanence to the Bush era tax cuts. This would of course create another type of March Madness, but it also would only cost a minuscule five or six billion. Chump change.

There is the issue of raising the debt ceiling that will have to survive a potential Senate filibuster by one of our new freshman Kentucky senators who will be calling for a balanced federal budget. This ophthalmologist turned tea drinker may not see eye to eye with adding more money to a spending bill -- even if it would be good for patients.

But no one said it would be easy.

- Posted using BlogPress from my iPad

Location:37,000 feet over Arizona

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