Medicare Payment Action Alert

Congress only has a few weeks left to stop Medicare from cutting your payments next year. Please use the AMA’s toll-free Grassroots Hotline at
1-800-833-6354 to call and tell your senators and representative that:

Congress Must Act Now to Prevent Medicare Physician Pay Cuts And Provide Positive Updates.

We recognize that Congress must address numerous issues in the remaining days of its 2005 legislative schedule, especially in light of Katrina-related relief efforts. However, unless Congress and the Administration act this fall, Medicare physician payment rates will be cut by 26% over the next six years – beginning with a 4.4% cut on January 1, 2006. Action must be taken now because unlike other provider groups, physicians have not had a payment update that kept up with practice expense increases since 2001. Another cut or even a freeze will force many to cut services to Medicare patients in order to make ends meet.

If this 2006 cut is imposed, the average physician payment rate will be less in 2006 than it was in 2001. Family physicians need positive payment updates that reflect the increases in their practice costs. Family physicians simply can not absorb payment cuts while their practice costs continue to grow. Congress wants physicians to participate in proposed quality improvement measures and invest in health information technology. However, family physicians are unable to bear these additional costs and practice burdens without positive updates.

Cuts in physician payments place seniors’ access to care in jeopardy. An AMA survey indicated that if payment cuts begin in 2006, more than a third (38%) of physicians intend to decrease the number of new Medicare patients they accept. Moreover, an estimated 34% of physicians whose practice serves a rural patient population will discontinue rural outreach services.

The payment updates of other providers are determined by formulas based on increases in practice costs. In 2006, other providers will receive the following positive updates: Medicare Advantage plans +4.8%; hospitals +3.7 %; nursing homes +3.1%; home health providers +2.5%. Only physicians are subject to the flawed Sustainable Growth Rate (SGR) formula, which produces negative updates because it is tied to the ups and downs of the national economy – and not to seniors’ health needs and the cost of their care.

Thank you very much for your assistance. Members of Congress really appreciate hearing from constituents and your call will make a difference. Please send a copy of any response you receive, to Jerome Connolly in the AAFP Government Relations Division -- jconnolly@aafp.org.