Senators plan move on performance bill

Finance Committee leaders pledge action on pay-for-performance under Medicare as a House lawmaker introduces her own version.

By David Glendinning, AMNews staff. Aug. 15, 2005.

Washington -- Senate sponsors of a Medicare pay-for-performance bill are committed to moving on the issue before year's end despite concerns that budgetary squabbling could keep Congress from addressing upcoming reductions in physician pay.

Senate Finance Committee Chair Charles Grassley (R, Iowa) told witnesses at a recent hearing that pay-for-performance legislation he wrote with Ranking Member Max Baucus (D, Mont.) will move through the committee in the months after the August congressional recess. "We expect that to be part of our final package this fall," Grassley said.

But whether the final package will include a measure to halt an estimated 4.3% cut in Medicare payments coming in January 2006 remains unclear. Grassley and Baucus made the decision to omit any reimbursement fix from their pay-for-performance bill, deferring instead to separate legislation authored by Sens. Jon Kyl (R, Ariz.) and Debbie Stabenow (D, Mich.) that would turn cuts in 2006 and 2007 into increases of at least 2.6%.

Both Finance leaders have expressed their support for moving the physician update bill as well, but the separation of the two issues heightens the chances that Congress will consider paying doctors based on how well they perform without linking the initiative to a repaired payment system.

Physicians warn that this cannot happen.

The formula that determines how much Medicare pays doctors is on a "collision course" with the concept of pay-for-performance, also known as value-based purchasing, said Nancy H. Nielsen, MD, PhD, speaker of the American Medical Association's House of Delegates. Implementing one without addressing the other would ignore the fact that doctors would need to exceed the formula's spending limits to improve patient care, she said.