Final Rule - 2007 Medicare Cuts Stand at 5 Percent as Congressional Action Looks Unlikely
• WASHINGTON
In November, the Centers for Medicare & Medicaid Services (CMS) announced it’s final rule on changes to the Medicare Physician Fee Schedule (MPFS): A reduction of a flat 5 percent in reimbursement payments to physicians.
Meanwhile, those hopes of those expecting stopgap action before the lame duck Congress retires for Christmas are flagging.
In addition to the 5 percent cut, a change in the calculation of the geographic practice cost index (GPCI) for physician work will cut Medicare reimbursements for physicians in most parts of Texas by up to 1.9 percent in 2007. There is no change expected for Dallas and Houston, but there will be a reduction of 0.47 percent in the Austin area, 0.54 percent for Galveston and 1.87 percent in most of the rest of the state, including Bexar County, the Coastal Bend, the Rio Grande Valley and Laredo.
On top of that, there are many specialty-specific cuts included.
“Unless Congress acts by year’s end, we’re up against a 5 percent across-the-board cut in all physician Medicare payments, additional specialty-specific cuts of up to 9 percent; additional location-specific cuts of 1.9 percent for physicians in most parts of Texas which includes East Texas, and cuts for imaging services of up to 5 percent,” said Pam Udall, director of media relations for the Texas Medical Association.
For instance, a combination of cuts in the Sustainable Growth Rate (SGR), Imaging and Relative Value Unit (RVU) changes will result in total cuts for Anesthesiologists of up to 12 percent, 11 percent for pathologists and 14 percent for radiologists, according to data from the TMA.
The TMA and other groups signed a letter to congressional leaders, including lame-duck Senate Majority Leader Bill Frist.
“On behalf of the undersigned national and state medical societies, we urge you to pass legislation during the lame-duck session of Congress to halt the scheduled Medicare physician payment cut and provide physicians with a positive payment update for 2007. If Congress does not act, the sustainable growth rate (SGR) will cut Medicare payments to physicians by 5 percent on Jan. 1, 2007,” the letter said.
“On numerous occasions, Members of Congress have indicated that this pending cut would be addressed prior to the end of the 109th Congress. We stand ready to work with you to fulfill those commitments,” it said.
The American Medical Association, which was gathered in Washington for its semi-annual policy meeting, continued to lobby lawmakers for action before the end of the year. Approximately 3,000 physicians attended the AMA meeting,
“As physicians from across the nation meet this week to set the course for the future of medicine, our focus is on stopping Medicare cuts that will harm seniors’ access to health care,” said AMA Board Chair Dr. Cecil Wilson.
“Congress returns to Washington today for its lame-duck session, and we urge lawmakers to make preserving seniors’ ability to get in and see the doctor a priority. Congress can do this by halting the 2007 Medicare physician payment cut and instead ensure a payment update that reflects increases in the costs of caring for patients,” said Dr. Wilson.
Physicians and advocates worry that any decision will be pushed back into the 110th Congress as the repercussions of the November mid-term elections sort themselves out. Congress reconvenes in January under the leadership of the Democrats in both the Senate and the House.
It’s worth noting that 73 percent of AMA campaign donations during the election went to Republican candidates.
“Democrats won’t allow anything to pass they don’t like, and Republicans have little interest in starting the Democratic reign early,” said Thomas Mann, a congressional scholar at the centrist Brookings Institution think tank in Washington.
“It could be a very short lame-duck session,” Mann said.
“These projected payment cuts will destabilize the Medicare program and erode access to care for America’s seniors,” the joint letter to Congress stated.
“According to an American Medical Association survey, if payments are cut as projected in 2007, 45 percent of physicians will either decrease or stop accepting new Medicare patients in 2007, and 50 percent of physicians plan to defer the purchase of information technology. Additionally, 43 percent of physicians will decrease the number of new TRICARE patients they accept, as TRICARE ties its physician payment rates to Medicare,” it said.
“If Congress does not act, we fear that physicians will be forced to make difficult decisions: Nearly half of physicians say Medicare cuts will force them to decrease or stop taking new Medicare patients,” said the AMA’s Dr. Wilson.
“Current Medicare payments in 2006 are about the same as they were in 2001, and nine years of cuts to physicians totaling about 40 percent will have a severe impact on seniors ability to get health care,” he said.
“When the point comes that they are losing money, they will cut Medicare patients or refuse to take additional Medicare patients. A doctor has the right to limit patients treated or not to see a patient,” the TMA’s Udall said.
The AMA Board of Trustees issued a report at their Washington meeting on activities to raise awareness of the cuts. The report calls on Congress to stop the 2007 payment cut, provide a positive payment update to reflect increases in medical practice costs, and include provisions to facilitate a long-term solution to the current physician payment system.
“Eighty senators and 265 representatives have called on Congress to take action in this session of Congress to stop the cuts, and Congress’ own advisory committee on Medicare has recommended tying Medicare payments to practice costs,” said Dr. Wilson. “Physicians nationwide speak in one voice to ask Congress to act now before time runs out for seniors and the physicians who care for them.”
CMS projects that it will pay approximately $61.5 billion to over 900,000 physicians and other health care professionals in 2007 as a result of the payment rates and policies adopted in the new rule. The changes will become effective January 1, 2007. • DT