Healthcare Business News

Baucus working to stall doc pay cut

By Rich Daly
Posted: December 7, 2012 - 8:45 am ET

The Senate Democratic health policy leader is writing legislation to delay an impending Medicare physician pay cut, according to health policy sources.

Sen. Max Baucus (D-Mont.), chairman of the powerful Finance Committee, is writing the bill that would delay a 26.5% Medicare physician fee cut scheduled to take effect Jan. 1, according to Sens. Charles Schumer (D-N.Y.) and Chuck Grassley (R-Iowa). The senators referenced Baucus' doc patch legislation in a letter they wrote on behalf of 29 of their colleagues (PDF) this week urging him to include extensions of a range of smaller Medicare payments for hospitals, including the low-volume and the Medicare-dependent hospital programs.

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Julius Hobson, a former lobbyist with the American Medical Association who now serves as a senior policy adviser at Polsinelli and Shugart, said the Baucus bill is a one year delay in the cuts. However, it is unclear how Baucus would pay for a one-year delay of the cut, which the Congressional Budget Office estimated would cost $25.2 billion over 10 years.

A Baucus spokeswoman did not reply to questions about the physician pay patch.

Proposals to pay for the cost of a one-year delay from the office of House Speaker John Boehner (R-Ohio) included a $15 billion cut in a coming temporary boost of Medicaid primary-care physician pay and $8 billion from cutting hospital evaluation and management payments, according to Hobson.

Boehner's office did not respond to questions about the temporary physician pay fix.

Hobson said Baucus was unlikely to introduce his legislation until it was clear that a massive end of the year legislative package including a Medicare physician pay fix was not going to clear Congress. However, the stand-alone Medicare pay patch was unlikely to advance, Hobson said, because other senators would block it.

The pressure on Congress to enact a permanent replacement for the Medicare physician payment formula was increased on Thursday by the Medicare Payment Advisory Commission when it considered re-submitting its recommendation for scrapping the current system. Congress' primary advisers on Medicare have not offered a specific replacement system for the sustainable-growth-rate formula for physician payments but their draft recommendation said it should incentivize physicians to move toward accountable care organizations.

Separately, MedPAC considered a recommendation of Glenn Hackbarth, its chairman, to increase Medicare payment rates for Ambulatory Surgical Centers by 0.5%.

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