The House and Senate early this morning each passed a version of a Medicare reform bill that provides all seniors with prescription drug benefits for the first time in the program's history.
Both bills also include rural relief packages for underpaid doctors, hospitals and home health organizations. In addition, the House bill provides physicians with 1.5% payment increases in 2004 and 2005 to replace the 4.2% cut in 2004 predicted by CMS.
Just after midnight, in a 76-21 vote, the Senate voted to approve the Prescription Drug and Medicare Improvement Act (S 1). A few hours later, in a much more partisan vote of 216-215, House lawmakers passed HR 1, the Medicare Prescription Drug and Modernization Act of 2003.
Deciding which chamber's fee changes for doctors will be passed into law now depends on the work of a conference committee that many predict will see contention over the role of private health plans in delivering the new drug benefit.
"Given that they both have positive indications--both improve the negative 4.2% update in 2004--I think the prospects for physicians are good," says Donald Fisher, president and CEO of the American Medical Group Association, Alexandria, Va. "Physician payment is not as controversial in the whole package when you consider the differences between the House and Senate."
Paul Speidell, a lobbyist for the Englewood, Colo.-based Medical Group Management Association, also expresses optimism about relief for doctors.
"We're hopeful, lets put it that way," Speidell says. "Obviously, nobody can predict what's going to happen here. But it's fair to say a lot of physician group practices around the country are depending on it."
Physicians were especially cheered by inclusion in the Senate bill of a resolution offered by Sens. Jon Kyl (R-Ariz.) and Orrin Hatch (R-Ore.) that recognizes the need to fix the flawed sustainable growth rate formula used to calculate the annual Medicare physician payment update.
"While this new legislative language is not binding and will not prevent the projected cut, it does put senators on record as supporting the need to fix the problem," says James Martin, M.D., president of the American Academy of Family Physicians, in a statement.
Martin says the resolution bolsters the payment provision in the House bill and "sends a clear message to the House-Senate conference committee responsible for working out the differences between the two bills."
Fisher says there could be several approaches to a permanent solution to the formula problem.
"This is something that will require a lot of study, with some of the best minds coming together to see if we want to fix the existing formula or come up with a new payment system," Fisher says. "But we might have a two-year window that should give us the opportunity to come up with something that makes sense for the longer term. What we have now doesn't work and we can't keep trying to fix it every year."
A leading proponent of the bipartisan Senate bill, Finance Committee ranking member Max Baucus (D-Mont.), says there is much work left to do throughout the conference with the House and even when the bill becomes effective.
"Today's vote marks an important milestone in health care history. But it is just the beginning," Baucus says in a statement. "The bill we've passed will set up an important framework. In the coming years, as more funds become available, I look forward to building upon this legislation and filling in some of the gaps."