Senate leaves Medicare pay fix undone

Congress adjourns before addressing the problems with the physician reimbursement rate.

By Markian Hawryluk, AMNews staff. Dec. 9, 2002.

Washington -- In a session noted for lawmakers' inability to agree on major pieces of health legislation, perhaps no omission will hit physicians harder than the failure of the 107th Congress to pass a Medicare physician payment update fix.

The Senate adjourned in November without passing a Medicare payment package that would have set physician payment updates at about 2% a year for the next three years.

It also failed to OK a measure that would have indemnified the Bush administration from lawsuits if it chose to correct errors in the formula administratively. The House passed both measures, but senators were unwilling to increase doctor reimbursement without boosting payments to hospitals, health plans and others.

"The consequences of Senate inaction will be dire," said AMA President Yank D. Coble Jr., MD. "The Medicare payment cuts are a mistake that everyone agrees should be corrected and put behind us. But if this recognized mistake is allowed to stand and create real harm for America's seniors, that's unforgivable."

The Centers for Medicare & Medicaid Services said the administration does not have the authority to fix projection errors and other technical problems in the formula that produced a 5.4% pay cut in 2002. CMS delayed publication of the 2003 update to resolve problems with practice expense costs for anesthesiologists. But CMS Administrator Tom Scully said the new update would cut rates another 4.4% unless Congress acted. [...]