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Medicare pay cut: Contact your lawmakers now

Physicians should let their legislators know now that they need relief from Medicare's outlandish payment update.

Editorial. Dec. 3, 2001.

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Physicians have every right to be thoroughly exasperated with the numbers that went into determining Medicare's 2002 payment update, as well as the resulting 5.4% overall pay cut for next year.

That leaves one number left that physicians can trust in this sorry mess, and it is S 1707. That's the Senate bill number assigned to The Medicare Physician Payment Fairness Act of 2001, introduced by Sens. Jim Jeffords (I, Vt.), John Breaux (D, La.) and Jon Kyl (R, Ariz.). A House version of the bill is expected soon.

The measure would greatly reduce the amount of the physician pay cut. More important, it instructs the Medicare Payment Advisory Commission -- which is already well aware of the problems with the system -- to recommend permanent solutions to this very flawed formula. This bill deserves the strong support of all physicians.

At the heart of the problem is the sustainable growth rate, the physician spending target that determines whether physician pay will be upped or cut. A key flaw in the SGR formula requires factoring in growth of the U.S. gross domestic product, even though the connection between that economic figure and the need for health care services is a mystery. That philosophical error is then greatly compounded by the use of numbers that are simply wrong. Inaccurate 1998 and 1999 GDP estimates are used in place of actual figures for those years. [...]