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The Joint Select Committee on Deficit Reduction failed to produce a plan to cut federal spending, triggering a process slated to cut physician pay and a host of public h
On Nov. 21, just hours before the midnight deadline for the so-called supercommittee to publicly announce a deficit-reduction plan, the cochairs of the committee issued a statement saying that they could not reach a bipartisan agreement.
"Despite our inability to bridge the committee's significant differences, we end this process united in our belief that the nation's fiscal crisis must be addressed and that we cannot leave it to the next generation to solve. We remain hopeful that Congress can build on this committee's work and can find a way to tackle this issue in a way that works for the American people and our economy," according to the statement from Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Tex.).
The bipartisan, bicameral committee of 12 lawmakers was convened last summer as part of the Budget Control Act and tasked with finding about $1.2 trillion in cuts to federal spending over a decade. Under the law, should the supercommittee fail to agree on how to meet that goal, automatic, across-the-board cuts called "sequestration" go into effect starting in 2013.
The cuts would be evenly divided among defense and nondefense spending. Most federal programs are subject to the cuts, except Social Security, Medicaid, the Children's Health Insurance Program, and other low-income programs. The Medicare program is spared some of the deepest cuts since the law calls only for provider cuts, which are capped at 2%.
Physicians' groups expressed disappointment that several weeks of hearings and closed-door meetings had not resulted in a plan. The automatic cuts would endanger everything from military health care, medical research, and disease prevention programs to the training of primary care physicians, Dr. Virginia L. Hood, president of the American College of Physicians, said in a statement.
She urged Congress not to let the sequestration process take effect. Instead, she called on lawmakers to craft a plan to reduce the deficit in a more deliberative way, looking at the cost drivers in health care instead of allowing the across-the-board cuts. The ACP has already provided members of Congress with a list of possible cuts that could produce between $500 billion and $800 billion in savings over the next decade.
For instance, the ACP favors giving the federal government authority to negotiate the prices for drugs paid for by Medicare, a policy change that they estimate would save about $300 billion over 10 years. The federal government also could realize about $62 billion in savings by enacting a medical liability reform plan that includes a $250,000 cap on noneconomic damages, according to the ACP.
But the more pressing concern for doctors is the 27% Medicare physician fee cut that will take effect in a few weeks if Congress doesn't take action to stop it.
Physicians' groups intensely lobbied the supercommittee to make replacing the Sustainable Growth Rate (SGR) formula, used in setting Medicare payments, part of any deficit-reduction plan. Now the task of getting a permanent SGR fix will be much more difficult, said Robert Doherty, ACP's senior vice president for government affairs and public policy.
There had been some interest among the supercommittee members in addressing the SGR, and a large deficit-reduction package was a reasonable place to deal with such an expensive problem, Mr. Doherty said in an interview. As part of a $1.2-trillion package, it was possible to find the necessary $300 billion in offsets to pay for a fix. Finding those offsets would be much harder in a stand-alone bill.
But while Mr. Doherty said the supercommittee's failure represents a "huge lost opportunity" on the SGR, the ACP is not giving up. He said the group favors a proposal from Rep. Allyson Schwartz (D-Pa.) to permanently repeal the SGR. The proposal, known as the Medicare Physician Payment Innovation Act, would stabilize Medicare physician payments for several years before moving to new payment systems.
Specifically, Rep. Schwartz proposes that the Center for Medicare and Medicaid Innovation come up with at least four new payment and delivery models. Starting in 2017, physicians could choose one of those new models or stay in the traditional fee-for-service system, but fee-for-service payments would begin to decline in 2018. At press time, the proposal had not been formally introduced in Congress.
The proposal won the support of the American Academy of Family Physicians, the American Osteopathic Association, the American College of Obstetricians and Gynecologists, and the Society of Hospital Medicine but not that of the American Medical Association.
The AMA praised Rep. Schwartz for her efforts to try to repeal the SGR but stopped short of endorsing the plan, saying that it couldn't sign on to the specific schedule of pay increases and penalties given the workflow changes and investments that would likely be required from physicians.
In the wake of the supercommittee's announcement, physicians' groups called on Congress to act immediately to avert the scheduled 27% Medicare pay cut and to come up with some sort of long-term solution to the annual scrambling to avert SGR-related fee cuts.
"The AMA is deeply concerned that continued instability in the Medicare program, including the looming 27% cut scheduled for Jan. 1, will force many physicians to limit the number of Medicare and TRICARE patients they can care for in their practices," Dr. Peter W. Carmel, president of the AMA, said in a statement . "Congress has ignored the reality that short-term patches have grown the problem immensely. The cost of repealing the formula has grown 525% in the past 5 years and will double again in the next 5 years."
Congressional Action Looming
The U.S. Senate voted on Dec. 17 to put off by 2 months a Medicare physician pay cut due to take effect on Jan. 1. The Senate voted 89-19 to approve the package, just before it left Washington for a holiday recess.
But on Dec. 19, as the House came back into session, many congressmen said they would not support the package, mainly because it only provided 2 months of relief, rather than a year or longer. Similar legislation passed the House Dec. 13, but with a longer horizon: If enacted, that bill would replace the 27% cut with a 1% increase for 2 years.
If the House votes against approving the Senate bill, and the two houses cannot compromise before Jan. 1, physicians will see a 27% reduction in fees, as dictated by the Medicare Sustainable Growth Rate (SGR) formula.
The American Medical Association expressed disgust in a statement issued after the Senate vote.
“Waiting until the last week of the legislative session to address a problem that Congress knew was looming all year is not the way to conduct our nation’s business,” AMA President Peter Carmel said in the statement.
The AMA called on Congress to stop instituting stop-gap fixes and to instead replace the SGR formula. “The 12 temporary patches that Congress has applied have raised the cost of solving the problem by more than 500% over the last few years and eroded patients’ access to care,” said Dr. Carmel. “A permanent solution is the long overdue, fiscally responsible approach.”
Alicia Ault contributed to this report.
Medicare beneficiaries are already having trouble finding physicians in many parts of the country, and deep cuts in physician reimbursements may indeed threaten the entire program. Since vascular surgeons are heavily dependent on Medicare support, large cuts in reimbursement or threats to the entire program could be nothing short of catastrophic.
| Dr. Donaldson |
There is no question Medicare cannot continue without cost control, but default "sequestration" or an across the board surgical approach to the budget does not do justice to the complexity of the problem nor take advantage of the crisis to make truly lasting and useful change. Neither does such a relatively oversimplified solution grapple with the obvious deep pockets of waste, defensive overutilization, fraud and overt competitive profiteering.
Furthermore, the Obama healthcare law is on the books and making good progress towards addressing the injustices of our system while at the same time controlling costs without sacrificing quality. At the end of the day, doctors worthy of their profession must join the current CMS effort, strive to keep their eye on the ball of value in patient care and support the fundamental constructive changes now in motion. With energetic expression of this recommitment and constructive cooperation on our part, street wisdom strongly suggests that a 27% cut will not go forward.
Magruder C. Donaldson, MD, is chair of surgery at Metrowest Medical Center in Framingham, Mass.
Medicare beneficiaries are already having trouble finding physicians in many parts of the country, and deep cuts in physician reimbursements may indeed threaten the entire program. Since vascular surgeons are heavily dependent on Medicare support, large cuts in reimbursement or threats to the entire program could be nothing short of catastrophic.
| Dr. Donaldson |
There is no question Medicare cannot continue without cost control, but default "sequestration" or an across the board surgical approach to the budget does not do justice to the complexity of the problem nor take advantage of the crisis to make truly lasting and useful change. Neither does such a relatively oversimplified solution grapple with the obvious deep pockets of waste, defensive overutilization, fraud and overt competitive profiteering.
Furthermore, the Obama healthcare law is on the books and making good progress towards addressing the injustices of our system while at the same time controlling costs without sacrificing quality. At the end of the day, doctors worthy of their profession must join the current CMS effort, strive to keep their eye on the ball of value in patient care and support the fundamental constructive changes now in motion. With energetic expression of this recommitment and constructive cooperation on our part, street wisdom strongly suggests that a 27% cut will not go forward.
Magruder C. Donaldson, MD, is chair of surgery at Metrowest Medical Center in Framingham, Mass.
Medicare beneficiaries are already having trouble finding physicians in many parts of the country, and deep cuts in physician reimbursements may indeed threaten the entire program. Since vascular surgeons are heavily dependent on Medicare support, large cuts in reimbursement or threats to the entire program could be nothing short of catastrophic.
| Dr. Donaldson |
There is no question Medicare cannot continue without cost control, but default "sequestration" or an across the board surgical approach to the budget does not do justice to the complexity of the problem nor take advantage of the crisis to make truly lasting and useful change. Neither does such a relatively oversimplified solution grapple with the obvious deep pockets of waste, defensive overutilization, fraud and overt competitive profiteering.
Furthermore, the Obama healthcare law is on the books and making good progress towards addressing the injustices of our system while at the same time controlling costs without sacrificing quality. At the end of the day, doctors worthy of their profession must join the current CMS effort, strive to keep their eye on the ball of value in patient care and support the fundamental constructive changes now in motion. With energetic expression of this recommitment and constructive cooperation on our part, street wisdom strongly suggests that a 27% cut will not go forward.
Magruder C. Donaldson, MD, is chair of surgery at Metrowest Medical Center in Framingham, Mass.
The Joint Select Committee on Deficit Reduction failed to produce a plan to cut federal spending, triggering a process slated to cut physician pay and a host of public h
On Nov. 21, just hours before the midnight deadline for the so-called supercommittee to publicly announce a deficit-reduction plan, the cochairs of the committee issued a statement saying that they could not reach a bipartisan agreement.
"Despite our inability to bridge the committee's significant differences, we end this process united in our belief that the nation's fiscal crisis must be addressed and that we cannot leave it to the next generation to solve. We remain hopeful that Congress can build on this committee's work and can find a way to tackle this issue in a way that works for the American people and our economy," according to the statement from Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Tex.).
The bipartisan, bicameral committee of 12 lawmakers was convened last summer as part of the Budget Control Act and tasked with finding about $1.2 trillion in cuts to federal spending over a decade. Under the law, should the supercommittee fail to agree on how to meet that goal, automatic, across-the-board cuts called "sequestration" go into effect starting in 2013.
The cuts would be evenly divided among defense and nondefense spending. Most federal programs are subject to the cuts, except Social Security, Medicaid, the Children's Health Insurance Program, and other low-income programs. The Medicare program is spared some of the deepest cuts since the law calls only for provider cuts, which are capped at 2%.
Physicians' groups expressed disappointment that several weeks of hearings and closed-door meetings had not resulted in a plan. The automatic cuts would endanger everything from military health care, medical research, and disease prevention programs to the training of primary care physicians, Dr. Virginia L. Hood, president of the American College of Physicians, said in a statement.
She urged Congress not to let the sequestration process take effect. Instead, she called on lawmakers to craft a plan to reduce the deficit in a more deliberative way, looking at the cost drivers in health care instead of allowing the across-the-board cuts. The ACP has already provided members of Congress with a list of possible cuts that could produce between $500 billion and $800 billion in savings over the next decade.
For instance, the ACP favors giving the federal government authority to negotiate the prices for drugs paid for by Medicare, a policy change that they estimate would save about $300 billion over 10 years. The federal government also could realize about $62 billion in savings by enacting a medical liability reform plan that includes a $250,000 cap on noneconomic damages, according to the ACP.
But the more pressing concern for doctors is the 27% Medicare physician fee cut that will take effect in a few weeks if Congress doesn't take action to stop it.
Physicians' groups intensely lobbied the supercommittee to make replacing the Sustainable Growth Rate (SGR) formula, used in setting Medicare payments, part of any deficit-reduction plan. Now the task of getting a permanent SGR fix will be much more difficult, said Robert Doherty, ACP's senior vice president for government affairs and public policy.
There had been some interest among the supercommittee members in addressing the SGR, and a large deficit-reduction package was a reasonable place to deal with such an expensive problem, Mr. Doherty said in an interview. As part of a $1.2-trillion package, it was possible to find the necessary $300 billion in offsets to pay for a fix. Finding those offsets would be much harder in a stand-alone bill.
But while Mr. Doherty said the supercommittee's failure represents a "huge lost opportunity" on the SGR, the ACP is not giving up. He said the group favors a proposal from Rep. Allyson Schwartz (D-Pa.) to permanently repeal the SGR. The proposal, known as the Medicare Physician Payment Innovation Act, would stabilize Medicare physician payments for several years before moving to new payment systems.
Specifically, Rep. Schwartz proposes that the Center for Medicare and Medicaid Innovation come up with at least four new payment and delivery models. Starting in 2017, physicians could choose one of those new models or stay in the traditional fee-for-service system, but fee-for-service payments would begin to decline in 2018. At press time, the proposal had not been formally introduced in Congress.
The proposal won the support of the American Academy of Family Physicians, the American Osteopathic Association, the American College of Obstetricians and Gynecologists, and the Society of Hospital Medicine but not that of the American Medical Association.
The AMA praised Rep. Schwartz for her efforts to try to repeal the SGR but stopped short of endorsing the plan, saying that it couldn't sign on to the specific schedule of pay increases and penalties given the workflow changes and investments that would likely be required from physicians.
In the wake of the supercommittee's announcement, physicians' groups called on Congress to act immediately to avert the scheduled 27% Medicare pay cut and to come up with some sort of long-term solution to the annual scrambling to avert SGR-related fee cuts.
"The AMA is deeply concerned that continued instability in the Medicare program, including the looming 27% cut scheduled for Jan. 1, will force many physicians to limit the number of Medicare and TRICARE patients they can care for in their practices," Dr. Peter W. Carmel, president of the AMA, said in a statement . "Congress has ignored the reality that short-term patches have grown the problem immensely. The cost of repealing the formula has grown 525% in the past 5 years and will double again in the next 5 years."
Congressional Action Looming
The U.S. Senate voted on Dec. 17 to put off by 2 months a Medicare physician pay cut due to take effect on Jan. 1. The Senate voted 89-19 to approve the package, just before it left Washington for a holiday recess.
But on Dec. 19, as the House came back into session, many congressmen said they would not support the package, mainly because it only provided 2 months of relief, rather than a year or longer. Similar legislation passed the House Dec. 13, but with a longer horizon: If enacted, that bill would replace the 27% cut with a 1% increase for 2 years.
If the House votes against approving the Senate bill, and the two houses cannot compromise before Jan. 1, physicians will see a 27% reduction in fees, as dictated by the Medicare Sustainable Growth Rate (SGR) formula.
The American Medical Association expressed disgust in a statement issued after the Senate vote.
“Waiting until the last week of the legislative session to address a problem that Congress knew was looming all year is not the way to conduct our nation’s business,” AMA President Peter Carmel said in the statement.
The AMA called on Congress to stop instituting stop-gap fixes and to instead replace the SGR formula. “The 12 temporary patches that Congress has applied have raised the cost of solving the problem by more than 500% over the last few years and eroded patients’ access to care,” said Dr. Carmel. “A permanent solution is the long overdue, fiscally responsible approach.”
Alicia Ault contributed to this report.
The Joint Select Committee on Deficit Reduction failed to produce a plan to cut federal spending, triggering a process slated to cut physician pay and a host of public h
On Nov. 21, just hours before the midnight deadline for the so-called supercommittee to publicly announce a deficit-reduction plan, the cochairs of the committee issued a statement saying that they could not reach a bipartisan agreement.
"Despite our inability to bridge the committee's significant differences, we end this process united in our belief that the nation's fiscal crisis must be addressed and that we cannot leave it to the next generation to solve. We remain hopeful that Congress can build on this committee's work and can find a way to tackle this issue in a way that works for the American people and our economy," according to the statement from Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Tex.).
The bipartisan, bicameral committee of 12 lawmakers was convened last summer as part of the Budget Control Act and tasked with finding about $1.2 trillion in cuts to federal spending over a decade. Under the law, should the supercommittee fail to agree on how to meet that goal, automatic, across-the-board cuts called "sequestration" go into effect starting in 2013.
The cuts would be evenly divided among defense and nondefense spending. Most federal programs are subject to the cuts, except Social Security, Medicaid, the Children's Health Insurance Program, and other low-income programs. The Medicare program is spared some of the deepest cuts since the law calls only for provider cuts, which are capped at 2%.
Physicians' groups expressed disappointment that several weeks of hearings and closed-door meetings had not resulted in a plan. The automatic cuts would endanger everything from military health care, medical research, and disease prevention programs to the training of primary care physicians, Dr. Virginia L. Hood, president of the American College of Physicians, said in a statement.
She urged Congress not to let the sequestration process take effect. Instead, she called on lawmakers to craft a plan to reduce the deficit in a more deliberative way, looking at the cost drivers in health care instead of allowing the across-the-board cuts. The ACP has already provided members of Congress with a list of possible cuts that could produce between $500 billion and $800 billion in savings over the next decade.
For instance, the ACP favors giving the federal government authority to negotiate the prices for drugs paid for by Medicare, a policy change that they estimate would save about $300 billion over 10 years. The federal government also could realize about $62 billion in savings by enacting a medical liability reform plan that includes a $250,000 cap on noneconomic damages, according to the ACP.
But the more pressing concern for doctors is the 27% Medicare physician fee cut that will take effect in a few weeks if Congress doesn't take action to stop it.
Physicians' groups intensely lobbied the supercommittee to make replacing the Sustainable Growth Rate (SGR) formula, used in setting Medicare payments, part of any deficit-reduction plan. Now the task of getting a permanent SGR fix will be much more difficult, said Robert Doherty, ACP's senior vice president for government affairs and public policy.
There had been some interest among the supercommittee members in addressing the SGR, and a large deficit-reduction package was a reasonable place to deal with such an expensive problem, Mr. Doherty said in an interview. As part of a $1.2-trillion package, it was possible to find the necessary $300 billion in offsets to pay for a fix. Finding those offsets would be much harder in a stand-alone bill.
But while Mr. Doherty said the supercommittee's failure represents a "huge lost opportunity" on the SGR, the ACP is not giving up. He said the group favors a proposal from Rep. Allyson Schwartz (D-Pa.) to permanently repeal the SGR. The proposal, known as the Medicare Physician Payment Innovation Act, would stabilize Medicare physician payments for several years before moving to new payment systems.
Specifically, Rep. Schwartz proposes that the Center for Medicare and Medicaid Innovation come up with at least four new payment and delivery models. Starting in 2017, physicians could choose one of those new models or stay in the traditional fee-for-service system, but fee-for-service payments would begin to decline in 2018. At press time, the proposal had not been formally introduced in Congress.
The proposal won the support of the American Academy of Family Physicians, the American Osteopathic Association, the American College of Obstetricians and Gynecologists, and the Society of Hospital Medicine but not that of the American Medical Association.
The AMA praised Rep. Schwartz for her efforts to try to repeal the SGR but stopped short of endorsing the plan, saying that it couldn't sign on to the specific schedule of pay increases and penalties given the workflow changes and investments that would likely be required from physicians.
In the wake of the supercommittee's announcement, physicians' groups called on Congress to act immediately to avert the scheduled 27% Medicare pay cut and to come up with some sort of long-term solution to the annual scrambling to avert SGR-related fee cuts.
"The AMA is deeply concerned that continued instability in the Medicare program, including the looming 27% cut scheduled for Jan. 1, will force many physicians to limit the number of Medicare and TRICARE patients they can care for in their practices," Dr. Peter W. Carmel, president of the AMA, said in a statement . "Congress has ignored the reality that short-term patches have grown the problem immensely. The cost of repealing the formula has grown 525% in the past 5 years and will double again in the next 5 years."
Congressional Action Looming
The U.S. Senate voted on Dec. 17 to put off by 2 months a Medicare physician pay cut due to take effect on Jan. 1. The Senate voted 89-19 to approve the package, just before it left Washington for a holiday recess.
But on Dec. 19, as the House came back into session, many congressmen said they would not support the package, mainly because it only provided 2 months of relief, rather than a year or longer. Similar legislation passed the House Dec. 13, but with a longer horizon: If enacted, that bill would replace the 27% cut with a 1% increase for 2 years.
If the House votes against approving the Senate bill, and the two houses cannot compromise before Jan. 1, physicians will see a 27% reduction in fees, as dictated by the Medicare Sustainable Growth Rate (SGR) formula.
The American Medical Association expressed disgust in a statement issued after the Senate vote.
“Waiting until the last week of the legislative session to address a problem that Congress knew was looming all year is not the way to conduct our nation’s business,” AMA President Peter Carmel said in the statement.
The AMA called on Congress to stop instituting stop-gap fixes and to instead replace the SGR formula. “The 12 temporary patches that Congress has applied have raised the cost of solving the problem by more than 500% over the last few years and eroded patients’ access to care,” said Dr. Carmel. “A permanent solution is the long overdue, fiscally responsible approach.”
Alicia Ault contributed to this report.