Medicare pay boost iffy under budget plan

Lawmakers consider attaching pay-for-performance initiative to any physician payment increase.

By David Glendinning, AMNews staff. April 4, 2005.

Washington -- The annual budget-writing process on Capitol Hill got off to a rough start in March, potentially complicating physicians' efforts to secure a Medicare rate increase next year.

The $2.6 trillion fiscal year 2006 budget resolutions passed by the House and Senate contain widely varying amounts of proposed reductions in entitlement spending, which includes Medicare, Medicaid and other programs. The House measure calls for slashing roughly $69 billion over five years, while the Senate measure calls for $17 billion in cuts.

Negotiators from both chambers now will attempt to work out a compromise resolution, which would serve as a blueprint for appropriators who must draft spending bills by the end of the fiscal year that fill in the funding details. Budget rules make it difficult for these lawmakers to exceed the targets set in the resolution.

Any final product that the two bodies produce would be expected to include some level of health spending cuts, according to congressional aides. The two House committees that have jurisdiction over Medicare and Medicaid, for instance, are instructed to carve out a total of nearly $40 billion over five years from all of the programs under their purview.