Kansas Health Institute | Information For Policy Makers. Health for Kansans.

WASHINGTON, D.C. — The U.S. Senate today voted to postpone until Nov. 21 a scheduled 21 percent cut in the rates paid to doctors who provide Medicare services and instead increase the payments by 2.2 percent.

But the provisions included in H.R. 3962 still needs approval in the U.S. House and the president's signature before the cut that kicked in June 1 is undone and the increase can begin. And the House can't act on the measure sooner than Tuesday.

Friday's voice vote was part of what has become an annual "dance" in Congress over the Medicare rates paid to physicians.

The scheduled cut was set in motion by what is known as the Sustainable Growth Rate Formula (SGR) adopted as part of the Balanced Budget Act of 1997 with the intention of curbing growing increases in Medicare spending.

Since that bill was passed doctors have seen their annual Medicare reimbursement rates cut just twice, by about 5 percent in 1999 and again by about 4 percent in 2002. Though the budget balancing formula has called for cuts each year since, Congress in each of the past several years has voted to reverse them.

Annual dance

But the annual uncertainty over rates is vexing to doctors in Kansas and elsewhere.

An online petition started by the Texas Medical Association that calls for a scuttling or major overhaul of the formula had collected about 110,000 signatures by Friday morning, including those from about 1,200 Kansas physicians, according to Allison Peterson of the Kansas Medical Society.

"Obviously, for the physican community and the hospital community, too, this annual dance that we go through with Congress is extremely frustrating and lends to a growing sense of uncertainty of how the physician community will be able to count on the federal government as a good business partner," said Peterson, the society's communications director.

She said the uncertainty is even more troubling for doctors now that they are being called upon by the federal government to invest in health information technology and as they plan for the influx of new patients expected as a result of the health reform law signed in March. According to projections, the reform beginning in 2014 will extend health insurance coverage to more than 130,000 Kansans who currently go without it.

"At their core," Peterson said, "physicians' offices are small businesses and it's very difficult to make budgeting forecasts, difficult to know whether to bring on a new physician in a rural community or hire a new nurse or a physician's assistant with so much uncertainty."

Health reform aside, Medicare is critically important in Kansas, where the population is disproportionately elderly. Especially in rural areas, it is not uncommon that Medicare patients account for the majority of a doctor's practice. About 400,000 Kansans rely on Medicare services.

The Kansas congressional delegation has consistently opposed cuts in Medicare reimbursements. U.S. Sens. Pat Roberts and Sam Brownback, both Republicans, have said they would support scrapping or reworking the payment formula. Roberts, in the past, has sponsored legislation to reform it.

Peterson said doctor groups around the country wanted a "permanent" fix to the reimbursement formula included in the health reform law. That didn't happen, so now they are hoping it will happen in the months ahead.

Angst and uncertainty

"I can say the physician community is longing for a permanent resolution to this annual dance that seems to take up so much of everyone's time and causes so much angst and uncertainty," she said.

There was other news this week in the angst-and-uncertainty department.

Kansas is among 30 states counting on Congress to extend through June 2011 extra federal Medicaid assistance scheduled to expire Dec. 31. Without that extended aid, Kansas faces a $131 million budget hole.

But efforts to get that passed as part of H.R. 4213 along with delaying the Medicare cuts were blocked Thursday night in the Senate after Democratic leaders failed to find enough support to forestall a Republican filibuster.

Because of the stalemate on H.R. 4213, the Medicare rate cut provisions were moved into H.R. 3962.