Medicare back on the brink over cuts to doctors

Pri­mary care physi­cian Dr. Don Klit­gaard greets Muriel Bacon at the Myrtue Med­ical Cen­ter in Har­lan, Iowa. Unless Con­gress acts before Jan. 1 doc­tors will again face steep Medicare cuts that threaten to under­mine health care for mil­lions of seniors and dis­abled peo­ple. (Asso­ci­ated Press | Nati Harnik)

RICARDO ALONSO-ZALDIVAR

Asso­ci­ated Press

WASHINGTON — It’s become a sym­bol of sorts for the fed­eral government’s bud­get dys­func­tion: Unless Con­gress acts before Jan. 1, doc­tors will again face steep Medicare cuts that threaten to under­mine health care for mil­lions of seniors and dis­abled people.

This time it’s a 27.4 per­cent cut. Last year, it was about 20 per­cent. The cuts are the con­se­quence of a 1990s bud­get law that failed to con­trol spend­ing but was never repealed. Con­gress passes a tem­po­rary fix each time, only to grow the size of reduc­tions required next time around. Last week’s super­com­mit­tee break­down leaves the so-called “doc fix” unre­solved with time run­ning out.

A thou­sand miles away in Har­lan, Iowa, Dr. Don Klit­gaard is try­ing to con­tain his frustration.

“I don’t see how pri­mary care doc­tors could take any­where near like a 27-percent pay cut and con­tinue to func­tion,” said Klit­gaard, a fam­ily physi­cian at a local med­ical cen­ter. “I assume there’s going to be a tem­po­rary fix, because the health care sys­tem is going to implode with­out it.”

Medicare patients account for about 45 per­cent of the vis­its to his clinic. Klit­gaard said the irony is that he and his col­leagues have been mak­ing improve­ments, keep­ing closer tabs on those with chronic ill­nesses in the hopes of avoid­ing need­less hos­pi­tal­iza­tions. While that can save money for Medicare, it requires con­sid­er­able upfront invest­ment from the med­ical practice.

“The threat of a huge cut makes it very dif­fi­cult to con­tinue down this road,” said Klit­gaard, adding “it’s almost com­i­cal” law­mak­ers would let the sit­u­a­tion get so far out of hand.

There’s noth­ing to laugh about, says a senior Wash­ing­ton lob­by­ist closely involved with the secre­tive super­com­mit­tee delib­er­a­tions. The health care indus­try lob­by­ist, who spoke on con­di­tion of anonymity because he is not autho­rized to make pub­lic state­ments, said law­mak­ers of both par­ties wanted to deal with the cuts to doc­tors, but a fun­da­men­tal par­ti­san divide over tax increases blocked progress of any kind.

The main options now before Con­gress include a one-year or two-year fix.

The prob­lem is the cost. Con­gress used to add it to the fed­eral deficit, but law­mak­ers can’t get away with that in these fis­cally aus­tere times. Instead, they must find about $22 bil­lion in off­sets for the one-year option, $35 bil­lion for the two-year ver­sion. A per­ma­nent fix would cost about $300 bil­lion over 10 years, mak­ing it much less likely.

“It’s going to be a real chal­lenge, and there’s not a lot of time to play ping-pong,” said the lob­by­ist. “It’s entirely pos­si­ble given past per­for­mance that Con­gress misses the deadline.”

Con­gres­sional lead­ers of both par­ties have said that won’t hap­pen. Sen­ate Finance Com­mit­tee Chair­man Max Bau­cus, D-Mont., says the Medicare fix is too impor­tant not to get done. But how? The endgame for a com­plex nego­ti­a­tion also involv­ing expir­ing tax cuts, unem­ploy­ment ben­e­fits and dozens of lesser issues remains unclear.

“They have to come up with a solu­tion, and they will have to appear to pay for that solu­tion, and that will be con­tentious,” said econ­o­mist Robert Reis­chauer, one of the pub­lic trustees who over­sees Medicare and Social Secu­rity financ­ing. One option: cut other parts of Medicare. Another: trim back spend­ing under the health care over­haul law. Either of those approaches would mobi­lize opposition.

A non­par­ti­san panel advis­ing law­mak­ers is rec­om­mend­ing that doc­tors share the pain of a per­ma­nent fix with a 10-year freeze for pri­mary care physi­cians and cuts fol­lowed by a freeze for spe­cial­ists. Doc­tors aren’t buy­ing that.

The Obama admin­is­tra­tion says seniors and their doc­tors have noth­ing to fear.

But doc­tors are becom­ing increas­ingly irri­tated about deal­ing with Medicare. Sur­veys have shown that many physi­cians would con­sider not tak­ing new Medicare patients if the cuts go through. Some pri­mary care doc­tors are going into “concierge med­i­cine,” lim­it­ing their prac­tice to patients able to pay a fee of about $1,500 a year, a trend that wor­ries advo­cates for the elderly.

Ulti­mately, the solu­tion is an over­haul of Medicare’s pay­ment sys­tem so that doc­tors are rewarded for pro­vid­ing qual­ity, cost-effective care, said Mark McClel­lan, an econ­o­mist and med­ical doc­tor who served as Medicare admin­is­tra­tor for Pres­i­dent George W. Bush. That con­tin­ues to elude policymakers.

Instead, the threat of pay­ment cuts has become a hol­i­day tra­di­tion, said McClel­lan. “It’s just not a very enjoy­able one.”

Posted by AP News on Nov 28 2011. You can follow any responses to this entry through the RSS Feed. Comments can be made below.