Medicare Payment Update Bill Introduced on Capitol Hill

The AAFP is rallying support for a Senate bill that would block steep reductions in Medicare physician payment rates for the latter half of this year and all of 2009 while giving Congress enough time to devise an alternative to the sustainable growth rate, or SGR, formula.

Sen. Debbie Stabenow, D-Mich., a member of the Senate Finance Committee, recently introduced S.B. 2785, (at the THOMAS Web site, type "S. 2785" in the search box after selecting "Bill Number") which would provide a 0.5 percent increase in the Medicare physician payment rate for the final six months of 2008 and a 1.8 percent increase for 2009. If approved, the Stabenow bill would block a 10.6 percent reduction scheduled to take place on July 1 and a 5 percent cut in 2009.

"We need some stability for the next 18 months so practices can make decisions about whether they want to take Medicare patients," said AAFP President Jim King, M.D., of Selmer, Tenn., explaining the Academy's support of the legislation. "This (bill) will give us some time to work with CMS and Congress to try and replace this broken SGR payment formula and put together a payment formula that makes sense. We think anything less than 18 months is not enough time to do that."

The AAFP is urging its members to contact their representatives and senators to voice support for the legislation and has issued a Speak Out alert to mobilize grass roots backing for the bill.

With a faltering economy, there is a chance Congress could let the July 1 deadline lapse or only pass a positive Medicare payment increase for the last six months of 2008 or for the next nine months, thus forcing the next Congress and administration to address the issue. Stabenow, in an interview with AAFP News Now, agreed with King's assessment that an 18-month payment extension is needed to provide stability for physician payment rates and to find a suitable alternative to the SGR.

"I am hopeful on two fronts," Stabenow said. "I am hopeful we will get a payment update -- I am certainly going to push for that -- but we also need to have this (update) extended for longer than six months if possible so physicians have a little bit more certainty."

"I know it has been a real rollercoaster ride," she said of the uncertainty produced by the SGR during the past several years.

Stabenow's bill does not specify budgetary offsets needed to pay for the Medicare update. She acknowledged that passage of her bill in its complete form represents a "challenge." It does not have any Republican co-sponsors at the time of this writing.

"The key thing is what will the president sign," Stabenow said. The Bush administration and congressional Republicans oppose cuts to Medicare Advantage, Medicare's managed care plan, to pay for Medicare payment updates, making it more difficult to find the budget offsets needed to pay for the elimination of the SGR.

Stabenow expects Sen. Max Baucus, D-Mont., chair of the Senate Finance Committee, and Sen. Charles Grassley, R-Iowa, the senior Republican member of the committee, to also introduce legislation blocking the pending cuts. She is hopeful parts of her bill will be incorporated into a proposal put forth by Baucus and Grassley, including the 18-month update.

"We need everybody's help right now in communicating with their Senators and House members about the urgency of this -- anything physicians can do to make this real in terms of what is happening to patients," Stabenow said.

In the last few weeks, AAFP Board members have met with nearly every member of the Senate Finance Committee and their staffs to urge a positive update in Medicare physician payment rates for the next 18 months and to explain the devastating impact of the SGR on physician payment rates. Board members also asked committee members to work on a replacement for the SGR formula.

The Academy's latest efforts on behalf of the Stabenow bill coincide with an ongoing campaign to stop the Medicare cuts, a campaign that has generated more than 800 messages to lawmakers on Capitol Hill since its inception on Feb. 9.

The Medicare: Stop the Cut Campaign has bolstered the voice of family medicine on Capitol Hill, strengthening the bonds between family physicians and their patients who have joined together to warn lawmakers about the effect of the scheduled payment reductions on patient access and care.

"This campaign is having a significant impact," King said. "Number one, it is getting our members involved, and it also is getting our Medicare patients to understand the problems that the Medicare reductions are going to cause -- the decrease in patient access and the problems associated with that. We are going to need the help of our patients, so getting them involved is very important."

Stabenow described primary care as "critical" to the Medicare program and as the "heart and soul of medical service and health care." In a recent meeting with Michigan hospital officials, Stabenow learned hospitals are having trouble finding physicians who will accept Medicare patients.

"In the past, I have heard about difficulties with Medicaid," said Stabenow. "I have been hearing about that for years, but this is the first time I have really heard about concerns in terms of access for patients with Medicare."

This is a direct result of Medicare payment structures and cuts in Medicare services during the past few years, she said.