Senators announce deal to 'fix' Medicare doctor payments - for now

Senate leaders announced a deal late Tuesday to stave off deep cuts to physicians' Medicare payments by repurposing money set aside for the health law, Politico reports. The deal, announced by Senate Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., changes ... "how much money consumers would have to repay if they receive too large a subsidy in the health insurance exchanges after 2014. ... Under the health care reform law, if a person gets more of a tax subsidy than they're eligible for, they would have to repay no more than $250. Families would have to repay no more than $450. The deal on the table would raise those caps to between $600 and $3,500, depending on income." That will save more than $19 billion, enough to keep physician payments stable (Haberkorn, 12/7). 

The Associated Press: "The change shouldn't significantly affect how many people seek tax credits to buy a policy through new health insurance markets, a congressional aide familiar with the negotiations said. Starting in 2014, most Americans will be required to carry coverage and insurance companies will no longer be able to turn away those in poor health, or charge them more" (Alonso-Zaldivar, 12/8).

The deal will give doctors "a one-year reprieve from a 25 percent cut in the fees they receive from Medicare," Bloomberg reports. The background: "The scheduled fee cuts have climbed to the proposed 25 percent in 2011 from the original 4.8 percent reduction planned in 2002. Payments for physician and clinical services will account for 13 percent of the program's $509 billion in expenditures this year, according to an analysis of U.S. government data by the nonprofit Kaiser Family Foundation, based in Menlo Park, California" (Young, 12/7).

NPR adds, "Neither Republicans nor Democrats support the cuts — which are so large many predict they would result in doctors' dropping Medicare patients. But so far no one has figured out how to come up with the $300 billion or so it would cost to fix the problem, or agreed to add it to the nation's burgeoning budget deficit" (Rovner, 12/8). 

In KHN's Health on the Hill video and transcript, senior correspondent Mary Agnes Carey says liberal Democrats "no doubt will be upset about the idea that you're taking any money out of the health reform law to fund this physician payment fix, but the counterweight as we know is there's also a lot of pressure to not cut payments to Medicare, to physicians who take Medicare patients. ...  There has been a lot of concern that maybe doctors would stop taking new Medicare patients, if their payments were cut that they would have problems with their current caseload in taking additional patients, so there are counter pressures all over the place on this one" (Carey, 12/7).

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This article was reprinted from kaiserhealthnews.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.