Cut Medicare reimbursement to physicians, slash beneficiary access to office-based care, and watch government health costs spiral as seniors turn to more expensive institutional services. That's the likely scenario if Congress fails to avert a 4.3 percent reduction in Medicare physician reimbursement next year and a total 26 percent cut over six years, according to a recent AMA survey.
CMS informed the Medicare Payment Advisory Commission March 31 that physicians' reimbursement would fall 4.3 percent in 2006, and the survey sought physicians' reaction. Some 38 percent of responding physicians said that, as a result of the scheduled 2006 payment cut, they would reduce the number of new Medicare patients they accepted. The number of people 65 and older -- those directly affected by physician reimbursement cuts -- is expected to grow by nearly 5.2 million from 2000 to 2010, the U.S. Census Bureau estimated in 2004. The AMA survey results, released April 5, reinforce messages sent to Congress by AAFP and other organizations.
Last year, federal agencies projected cuts of about 5 percent per year for the next few years. Although the 2004 AAFP survey of members found nearly 92 percent currently participate in Medicare, "such unrelenting decreases will make it impossible for many more family physicians to accept new Medicare patients," the Academy said in written testimony to the House Ways and Means Health Subcommittee Feb. 23. "Congress and CMS must be willing to adequately reimburse primary care functions. Without the necessary resources to allow physicians to redesign their clinical workflow to deliver quality outcomes, Medicare beneficiaries will continue to experience fragmented and ineffective care."
Congress' likely answer, according to health policy analysts: Adopt the MedPAC recommendation to implement pay-for-performance measures as a way in which physicians who meet performance criteria can recoup some of the expected reduction in Medicare physician payment.
AAFP supports pay-for-performance initiatives as long as they infuse new money into Medicare to fund the incentive payments. That position differs from the MedPAC recommendation that Congress set aside 1 percent to 2 percent of current Medicare funds for incentive payments.
