Organizations Unite in Calling on Congress to Act on Medicare Payment Cut Now

The AAFP, together with other leading primary care organizations and the nation's largest senior lobby, today called on Congress to pass a bill that would provide a positive update in the Medicare physician payment rate. Without congressional intervention, physicians face a 21.3 percent reduction in the Medicare payment rate on June 1.

"Unless Congress acts to stop the 21 percent Medicare pay cut to physicians, even more elderly and disabled Americans and military families will find themselves holding a Medicare or TRICARE card that has little or no value," said Heim during a May 26 press conference here. "The pay cut will -- at best -- reduce the quality of services. Some physicians will try to shorten office visits so they see more patients to make up the difference. Others will be forced to lay off nurses, physician assistants and other staff so vital to high-quality care, convenient access and coordinated services."

Still other physicians will be forced to restrict the number of Medicare and TRICARE beneficiaries they accept or drop these patients altogether, a situation that already is occurring in some parts of the country, said Heim. And in a worst-case scenario, physicians will have to close their practices because they are driven out of business or into retirement by a payment system that has "frozen their practice income for nearly a decade while inflation has grown over 20 percent," said Heim.

Heim was joined at the press conference by representatives from the AARP, the American College of Physicians, the American Osteopathic Association and the Military Officers Association of America. All of the press conference participants urged Congress to pass H.R. 4213, the American Jobs and Closing Tax Loopholes Act, and thus avert the pending Medicare payment cut on June 1.

Heim acknowledged that H.R. 4213 does not represent a permanent Medicare payment fix. But it could provide a reprieve from Medicare payment reductions and give Congress enough time to find a permanent replacement for the sustainable growth rate, or SGR, formula, Heim said.

The SGR formula has triggered steep reductions in Medicare physician payment rates for the past several years, and even though Congress has repeatedly stepped in at the last moment to block the cuts, the process has created a great deal of anxiety in the physician community.

"At some point, it ends up getting to that critical point where we can't plan for the future, we can't invest in our practices and we can't have the stability," said Heim.

In addition, she said, physicians have to compensate their staffs and pay their bills using 2010 dollars, but they are still being paid at 2001 rates under Medicare because of the SGR formula.

Lee Hammond, president of the AARP, said during the press conference, "for nearly a decade now, millions of AARP members, older Americans and their doctors have shared an annual anxiety-ridden ritual because Congress has persisted in treating Medicare's critically injured physician payment formula with Band-Aids."

"Doctors have repeatedly found themselves threatened with sharp cuts to their reimbursements for treating Medicare patients," Hammond said. Medicare beneficiaries, for their part, "sit in fear of receiving the dreaded letter that tells them their doctor can no longer afford to treat them."

Heim told press conference attendees that the current Medicare payment situation "should not be about partisan issues."

"This is about people," she said. "A generation of people who worked hard, paid their taxes, defended their country, educated their children and built this nation. It's about people who heard a promise -- that we would ensure stability in their access to the physicians who care for them and the services that maintain their quality of life."