Congressional Spat Over Doctor's Medicare Pay Threatens Obama's Healthcare Reform Effort

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A Congressional stalemate over how to stave off a hefty pay cut to doctors treating Medicare patients threatens to undermine President Barack Obama's healthcare reform effort – even as the administration mails out a glossy brochure to reassure seniors the healthcare program is on solid ground.

For the third time this year, Democrats and Republicans are squabbling over a provision to approve billions of dollars in new spending to avoid a scheduled 21.3% cut in reimbursements to doctors who treat Medicare patients.

If GOP senators don't allow the stalled proposal to pass, some doctors will stop treating Medicare recipients, Obama said in his weekly radio and Internet address last Saturday.

How lawmakers will resolve the problem is up in the air. Initially, Democrats had proposed a five-year fix, then three years. Now leaders are hoping to postpone the cut until the end of 2011.

If the problem isn't resolved, it could wreak havoc on Obama's healthcare reform plan, which proposes to use Medicare as a testing ground for improving the quality of care for all Americans. Concerns about Medicare's future stability could also present problems for Democrats in the elections, as seniors fret over what impact reform will have on their medical care.

"We will not have that cut," House Speaker Nancy Pelosi, D-CA, told the Associated Press.

The reimbursement problem has its roots in a 1990s deficit reduction law. Over the years, Congress has routinely waived the cuts. But that only complicated the long-term problem, increasing the size of future cuts needed to meet deficit reduction goals.

Repeated short-term fixes of the problem in recent years have left doctors frustrated and now some are refusing to take new Medicare patients. Since the latest extension expired May 31, doctors have been holding off on submitting claims until Congress approves another patch.

The latest fix is part of a multi-billion dollar bill that would extend several popular tax breaks while greatly increasing the tax that oil companies pay into an oil spill liability fund. Republican senators have refused to go along with higher taxes without offsetting expenditure reductions. Meanwhile, the doctors' pay issue languishes.

Roughly 97% of doctors nationwide are participating in Medicare, about the same as in 2009, according to the Centers for Medicare and Medicaid Services. But 17% of doctors say they are now restricting the number of Medicare patients they will accept, according to a survey conducted by the American Medical Association (AMA). The figure rises to 31% for primary care physicians, many of who blame the constant threat of payment cuts.

"This cut is basically the last straw," J. James Rohack, president of the AMA, which represents thousands of doctors told The Wall Street Journal. "This is no way to run a major health insurance program."

Although government surveys indicate that doctors are about equally compensated for Medicare compared to that of privately insured patients, some doctors say that's not always the case.

Dr. Lee Antles, an internist in Olympia, Washington, says Medicare pays him $95 for a visit that covers six organ systems. By comparison, Aetna Inc. (NYSE: AET) pays $129 and Uniform Medical Plan, which covers state workers, pays $140. To make up for the reduced reimbursements, his wife Margie has taken out four loans and borrowed money from her parents.

She told The Journal the financial pressures reached a breaking point after Memorial Day, when the Senate adjourned without passing another delay in the payment cuts. "We said, 'We have to sit down over the kitchen table and talk about this. We cannot ignore this anymore.'"

Some Medicare advocates blame Congress and the administration for not dealing with the problem when they conducted marathon sessions debating the healthcare overhaul. The healthcare legislation cut $500 billion from hospitals, insurers and other Medicare providers in order to provide coverage for the uninsured.

Eliminating the reimbursement cuts would have pushed the cost of the legislation above Obama's preset limit of $1 trillion, over 10-years.

"They should have used Medicare dollars to fix this," economist Marilyn Moon who helped oversee Medicare's finances from 1995-2000, told the AP. "It's irresponsible that the health care law left such a major issue unresolved while at the same time claiming to reduce the federal deficit."

The administration wants to repeal the cuts altogether, and the House recently passed a bill to do that. But the Senate couldn't muster the 60 votes needed to pass it.

"The key problem is that no one wants to pay for it," John Rother, top strategist for AARP, the seniors' lobby told the AP. "This is something that requires some additional revenue, and we should face up to that fact."

Meanwhile, the administration is mailing out a brochure to 46 million Medicare recipients extolling the benefits of the new health care law. The bill, says the brochure, "keeps Medicare strong and solvent."

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  1. Frankie Diaz | June 16, 2010

    Can anyone spell S-P-I-N?!? Government bureucracies, Legislators, special interest groups, and a lot of other in-betweeners are about to hear the Piper! It seems no one is thinking anymore on how to pay the bill, or the fact the health care providers CAN boycott the entire law by refusing to serve.

    What's next? Forced labor on pain of death? Good luck, Mr. President.

    Long live Socialist USA.

  2. n8whit | June 18, 2010

    Where is all this money going to come from? The country is already 14 trillion dollars in debt right now!

  3. george johnson | June 18, 2010

    oboma has messed up our medicare.he dosent care what happens to the edlery people.he wants to cut our social security.next he wants to do away with social security period.him and reed and polickey.and theother senitors.well we have a suprise coming in november election.we will vote them out of office.the SEnotors and congress should cut ther wages about SEVENTY THOUSAND DOLLARS EACH YEAR.OBOMA SHOULD CUT HIS SALRAY ABOUT 2 HUNDRED THOUSAND A YEAR. NO THEY HALFT TO PICK ON THE ELDERLEY.I HAVE SERVED IN WW.2 FOR 2-1/2 YEARS 5 YEARS IN THE NAVAL RESERVES DURING THE KOREN CNFLICT.HE DIDEN SERVE NO TIME IN THE MILTARY.THEN HE WANTS TO CUT SOCIAL SECURITY.AND MEDICARE GO.JOHNSON

  4. Anthony Palombo, DC | June 18, 2010

    It seems to me that we are putting our tax dollars into a bottomless pit we erroneously call "health care." While I appreciate the knee prosthesis Medicare made possible for me, and the wrist surgery for carpal tunnel syndrome in both my hands, I am at a loss to understand why we do not put our Medicare dollars into Alternative health and wellness care. What we call "health care" is really disease management, and a lot of money is being spent on the elderly who simply do not benefit from hip and knee replacements, for example. A case in point: an elderly patient of mine, rest her soul, was given a hip prosthesis when she was too old and wasted in the muscles of her legs to take rehab. Medicare paid out $130K on her in disease care management, which also included a pace maker, which gave her several more years of a life that had little quality to it. It simply gave her more years of ongoing medical care paid for by Medicare.

    It seems that medical science and doctors think they are responsible to keep people alive at all costs, and perhaps we Americans support this attitude by our attitude of entitlement. What has happened to the right to a dignified death? But that's beside my point. My point is that more natural alternative – or "complementary" as medicine is calling it – health care has proven to increase the quality of life for all people, including the elderly. Only the elderly can't afford it and Medicare doesn't pay for it.

    Chiropractic, for example, is a valuable form of natural health care, but I had to get out of the Medicare system because the reimbursement simply was not even enough to pay for the process of filing claims. And it didn't pay for the most effective aspect of my care, which was nutritional and herbal therapies and non-invasive, low cost methods of ascertaining the need for such. Why not put our tax dollars into real health care that builds health and wellness, the only way to stave off disease?!

    Having said that, let me remind us all that health is a personal responsibility each individual has. It is not a collective one. The government is not responsible for my health. I am. If I do not take care of my own body temple as a sacred privilege and responsibility when I am young, then why should I expect the collective to keep me alive at all costs when my body no longer serves me? Why have we cast death as a less-than dignified process, something we are duty-bound to put off as long as possible? And what makes that possible? Medicare! Money, money, money!!! If we don't have the money to pay for it, then it seems to me we simply do without. Is there no common sense left in Americans, in our government, in our medical science?! "God forbid we do without!" Or is it "Money forbid we do without!" ? Money, after all, has become our god. Wence have we fallen to such depth of depravity that we have replaced our Creator with money?! This cannot last much longer.

    The solution to the so-called "health care crisis" if health care, not disease management. Simple and affordable.

  5. OldDoc | June 24, 2010

    Obama didn't do this one. The pay drop was dictated by a law passed by Congress 13 years ago that governs TOTAL medicare expenditures, tying them to the increase in consumer prices or some such – the so-called "sustainable growth rate formula." If twice as many Medicare patients visit the doc, but total payout is fixed, then payments for each visit must be cut in half. The coming wave of baby boomers guarantees a huge increase in visits, so it was easy to see even 13 years ago what was going to happen.

    The only solution is to get the government out of the business of price fixing. Medicine is the only arena where the government fixes prices. Your lawyer's fees are not government controlled, nor your dentist's, nor your vet's fees. Either let physicians collect their normal fee, with Medicare paying what it can toward that fee (i.e., allow "balance billing"), or abolish Medicare altogether.

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