President Bush's 2004 budget proposes adjusting the physician payment formula under Medicare that has resulted in two years of cuts, with more projected in coming years.
The proposal would correct the formula so that it uses actual data instead of estimates of the gross domestic product, as it has done since passage of the Balanced Budget Act of 1997. The intention is to calculate higher updates to the physician fee schedule for the next several years.
Physicians took a 5.4% cut in 2002 and will face another 4.4% cut on March 1 should Congress fail to legislate a freeze.
"President Bush acknowledges that America's seniors should not pay for the government's mistakes--and he pledges to fix it," says AMA president Yank Coble, Jr., M.D. in a statement.
But it is up to Congress to pass a law that would make such a change possible. Bills pending in both the House and Senate would provide a short-term postponement of the next increase, but must be passed before Feb. 12 in order for CMS to adjust its payment systems, according to CMS administrator Thomas Scully.
Bush's budget also plans to link payments to health plans in the Medicare+Choice program to the rising cost of delivering healthcare, according to a summary of the budget. About 407 plans left the program or reduced services over the last five years, citing inadequate reimbursement.
In total, Bush seeks $539 billion for HHS in fiscal year 2004, an increase of $36.8 billion, or 7%, over last year's request.