WASHINGTON—Congress is closer than ever to finally repealing and replacing the Medicare physician-payment system. But with the March 31 deadline to act on the sustainable growth-rate formula a week away, there are at least six potential landmines that could derail the surprise $200 billion-plus deal negotiated by House Speaker John Boehner and Minority Leader Nancy Pelosi.
The possible deal killers are:
1. The Congressional Budget Office score
2. The Children's Health Insurance Program
3. Higher beneficiary cost-sharing
4. Any poison-pill additions
6. Presidential ambitions
The specifics of how to pay for the plan—which would stave off a 21.2% physician payment cut and extend the Children's Health Insurance Program by two years—and exactly what's included were in flux at the end of last week. The final negotiations could throw off the “careful calibrations” that allowed the deal to materialize, said Stephen Northrup, a partner at lobbying firm Rampy Northrup and former GOP congressional staffer.
Under the deal's broad parameters, first reported March 13 by Modern Healthcare, roughly a third of the $200 billion cost would be offset by payment cuts to healthcare providers and higher cost-sharing and premium contributions for Medicare beneficiaries. Those Medicare restructuring features are appealing to Republicans.
Part of the cost of the bill is a late addition of $7.2 billion in new funding for community health centers.
The SGR negotiations represent a rare instance of bipartisan dealmaking in today's Washington and could foreshadow further cooperation as Congress begins the tough slog of passing a 2016 budget. But it could prove perilous for Boehner, who has faced repeated insurrections from conservatives.
The failure to pay for the entire package is a nonstarter for some on the right, with the conservative Heritage Action for America blasting the deal as financially reckless. Further complicating matters is an analysis by the nonpartisan Center for a Responsible Federal Budget showing that the SGR deal would add $400 billion to the federal deficit by 2035. Another potential tripwire is the imminent Congressional Budget Office scoring of the package.
Corralling Democratic support, particularly in the Senate, could prove challenging for different reasons. When the joint House-Senate SGR repeal bills were introduced last Thursday, one key name was conspicuously absent: Sen. Ron Wyden (D-Ore.), the ranking member of the Finance Committee. The chief concern for Wyden and his Democratic colleagues is they want a four-year funding reauthorization for CHIP rather than the two-year patch. Democrats also worried about pushing more costs onto Medicare beneficiaries and a provision that bars community health centers from using federal dollars to pay for abortions.
“There is still time to work out a product that … is something members of both parties in both chambers can support,” Wyden said in a written statement last week. “We are just not there yet.”
All this left healthcare industry groups guardedly optimistic. Failure would mean an 18th consecutive short-term “doc fix” and another maddening spin on the SGR merry-go-round.
Stan Collender, a fiscal policy expert at Qorvis MSLGroup, said the House votes needed for passage were there, even though the House has been the troublesome chamber for bipartisan deals over the past few years. But he predicted trouble in the Senate, cautioning that GOP conservatives and presidential hopefuls including Sens. Rand Paul of Kentucky and Ted Cruz of Texas may try to filibuster the package. As of last Thursday, he said there's a two-thirds chance the measure will pass.
“The votes may be there to overcome a filibuster,” Collender said. “But it's not going to be easy.”