Opinion: Senate needs to halt cutbacks in Medicare payments


On Thursday, June 26, 2008, the U.S. Senate had the opportunity to avert a July 1, 2008, 10.6 percent cut in payments to physicians who care for Medicare beneficiaries.

This opportunity presented itself in the form of a cloture vote (to avoid a “filibuster”) on HR6331. HR6331 was passed by the House earlier in the week by an overwhelming, bipartisan vote of 355 to 59.

HR6331 would have provided the status quo in Medicare physician payment for the remainder of this year, a modest 1.1 percent increase for 2009, and a special provision for Alaska.

This special provision would have increased immediately, on a permanent basis, the Medicare physician payment schedule in Alaska by about 35 percent. That increase would put the Medicare payments at about the same level as for the Alaska Medicaid program. However, this enhanced payment schedule would still not cover the cost for an Alaska doctor to operate a practice.

HR6331 is a bill very similar to two Senate bills — one authored by Sen. Max Baucus (D-MT), chair of the Senate Finance Committee; and one by Senator Charles Grassley (R-Iowa), the ranking minority member of that committee. The special Alaska provision is in all three of these bills.

The cloture vote on June 26th failed by one vote — which if it had passed would have brought HR6331 to a Senate floor vote in time to avert the 10.6 percent cut on July 1st. Both Alaska senators voted to move HR6331 to the Senate floor. We commend them for that support for Alaska’s Medicare beneficiaries and doctors. Sens. Stevens and Murkowski both worked hard to get the special Alaska provision included in all three of the bills. Sen. Stevens deserves special kudos for spearheading and being the architect in developing and including this provision in all these bills.

The special Alaska provision, a 35 percent increase in the for primary care physicians, is very similar to the temporary increase in 2004 and 2005. That was also engineered by Sens. Stevens and Murkowski. It resulted in better access to care for our Medicare beneficiaries, and the same can be expected if this new provision is enacted.

The Senate is now in recess and will return on July 7th. We urge the Senate to immediately fix, on its return, what it didn’t fix before it recessed for the 4th of July.

This required action by Congress is still just another application of a “band-aid” to the complicated and flawed formula that determines the Medicare physician payment schedule.

For the past 10 years, this formula has produced cuts in the Medicare physician payments when the costs of running a practice continue to materially increase. This formula, the Sustainable Growth Rate Formula (SGR) is broken and needs to be permanently repaired.

Each year, Congress has been engaged in similar last-minute “band-aid” treatments to a broken formula that produces absurd results, and pays for a fraction of the cost for an Alaska doctor to operate a practice. Physicians in effect, are small- business people with increasing overhead and shrinking reimbursements.

Any of the three current bills under consideration would provide for an approximate 18-month bridge period in which the fatally flawed and broken formula can and must be addressed and fixed.

Physicians in Alaska and throughout the country are outraged by the latest failure by the Senate to apply the dressing to stanch the Medicare blood flow. Alaska is indeed fortunate to have two senators who have and will fight to do the right thing for Alaska Medicare beneficiaries.

The Medicare system operates currently only through the altruism of the physician community all over the United States — but even altruism has its limits.

Dr. Thomas Vasileff is president and Dr. J. Ross Tanner is immediate past president of the Alaska State Medical Association.

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