AARP Launches Campaign That Could Complicate Passage of Payment Update Legislation

AARP has emerged as a major player in the fight to safeguard Medicare physician pay by launching a multimillion dollar lobbying campaign that could complicate efforts to pass legislation to prevent physician payment reductions.

In late April, the nation's largest senior lobbying group unveiled the Keep Medicare Fair campaign to stop Congress from enacting any Medicare payment update bill that would result in higher premiums for Medicare beneficiaries.

Physicians are facing a 10.6 percent cut in the Medicare physician payment rate on July 1 unless Congress acts to block the reduction. Although Sen. Max Baucus, D-Mont., reportedly is drafting a bill that would provide a small increase in Medicare payment rates for the next 18 months, that bill does not include any protections against premium increases for Medicare beneficiaries. This has raised objections from AARP, according to Drew Nannis, a spokesperson for AARP.

Baucus and other congressional Democrats want to pay for the physician payment update by including reductions in the subsidy for Medicare Advantage, Medicare's managed care program. However, the Bush administration and some congressional Republicans oppose such cuts, creating an impasse on how to pay for the update.

In the past several weeks, AARP, which represents more than 39 million people, has aired its message on radio and television stations throughout the country and has generated more than 500,000 member e-mails, petitions, and faxes to House and Senate members urging Congress to reject any Medicare payment patch that passes along costs to Medicare beneficiaries, said Nannis.

The campaign has added another layer of complexity to an already complicated payment situation, making it more difficult for Congress to find the offsets needed to finance the update, according to Kevin Burke, director of the AAFP's Division of Government Relations.

Nevertheless, AARP's campaign was not unexpected and is not unwarranted, said Burke. "It is a part of the process," he said. "It is something that Congress has to deal with."

Nannis said that "AARP is in no way opposed to making sure that physicians are paid what they need."

"Frankly, the access-to-doctors issue is one that is important to people in Medicare," he said. "We need to make sure people can see the doctors they want; that being said, they need to be able to afford the program so they can see their doctors."

Medicare beneficiaries, Nannis said, "have an expectation that their premiums will increase from year to year. But these are extra increases, above and beyond what you might consider normal."

Medicare relies on the flawed sustainable growth rate, or SGR, formula to determine physician payment levels. During the past several years, the SGR has triggered deep reductions in physician payments that have only been averted by last-minute congressional intervention. Nannis called on Congress to overhaul Medicare's payment system to obviate "these annual patching programs."

In the meantime, AARP will keep the pressure on the Senate to ensure the Medicare payment legislation "includes the patient protections we need," Nannis said.