While the “March Madness” that resulted in the passage of the Patient Protection and Affordability Care Act of 2010 would lead you to believe that STAT change was needed in our health care system, the on-going delay in the “fix” to the SGR (sustainable growth rate) formula for Medicare invokes images of a long waiting list for a rationed medical procedure.
Medicare, the federal government’s health care insurance plan for the elderly and disabled established in 1965, is largely funded from payroll taxes and FICA, and supplemented with premiums paid by its beneficiaries. It is administered by the Department of Health and Human Services via the Centers for Medicare and Medicaid Services (CMS), and is the place to look to see how our government will administer a health care system.
Since 1998, the SGR has been a component of the formula used to calculate physician payments for providing services to Medicare patients. It is based on the GDP and not on actual health care practice costs (which have been rising faster than the GDP.) The SGR produced steep cuts in physician compensation for services to Medicare patients, in hopes that by paying individual physicians less, overall health care cost would decrease.
Unfortunately, this approach has failed.
Pay to physicians caring for Medicare patients has been stagnant, while health care costs have gone up. Many physicians report receiving little net income or are barely breaking even for their care of Medicare patients. Congress has stepped in nine times since 2002 to prevent or reverse increasingly larger Medicare physician payment cuts mandated by the SGR formula. As a contingent of its support for the health care reform passed in March, the American Medical Association demanded that the flawed SGR formula be abolished.
The doctors are still waiting.
Congress had chosen to delay the cuts three times this year, but voted Thursday to allow the 21% cut in physician reimbursement to take effect now. The impact of this will be dramatic. Medicare patients & those working in the medical field are already paying the price for Congress’ inaction. An AMA poll of over 9000 doctors last month revealed that delayed Medicare payments had already caused them to postpone or cancel scheduled services to Medicare patients, while 17% of these doctors report holding up paychecks or laying off their staff – with over 1500 workers affected by this. Physicians also report limiting the numbers of Medicare patients they will see, and some have opted out of Medicare altogether.
One might consider Congress’ inability to resolve the SGR predicament as the “anti-health, anti-stimulus bill.” The cost of using the flawed SGR formula was not factored into the cost of health care reform, and it is not going away. What will go away are doctors willing to care for Medicare patients, despite the promise “if you like your doctor, you can keep him.”
The SGR problem should have been solved before comprehensive health care reform was signed into law.
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