Everyone in healthcare — from insurers to doctors to patients — have long played a game of “not it” whenever Congress tried to trash a flawed Medicare payment formula.
Now, it looks like patients and hospitals might be the losers.
Amid much fanfare Tuesday, lawmakers rolled out a long-awaited, bipartisan bill to once and for all do away with the “sustainable growth rate” — a terribly written formula that governs how much Medicare doctors are paid.
Since the formula would otherwise lead to massive pay cuts for doctors, Congress typically circumvents it every year with a temporary patch known as the “doc fix.” But now lawmakers are making their hardest push yet to permanently replace the growth rate with a system that rewards doctors for providing better care.
The sticking point is — and has been for years — how to pay for it. Everyone wants the formula fixed, but no one in the healthcare industry wants to pony up.
Reflecting that gridlock, the House is proposing to pay for just one-third of the roughly $210 billion legislation. About half of those payments would come from raising premiums for wealthier seniors — known as “means testing” — and prohibiting Medigap plans from covering deductibles for Medicare Part B, the part of the program that pays for doctor visits.
And that’s irking seniors’ groups, who insist cutting benefits for the elderly isn’t the way to go.
“Right now, it’s just not a fair deal,” said Ariel Gonzalez, a lobbyist for the AARP. “We honestly want the same deal the prescription drug industry and the physician community are getting. How much are they paying? Zero dollars and zero cents.”
The plan doesn’t extract any new payments or wring any cuts from drug makers or insurers, Gonzalez pointed out.
Dan Adcock, a lobbyist for the National Committee to Preserve Social Security and Medicare, said he fears that if seniors are required to pay higher premiums this time, they’ll also be targeted the next time major reform legislation needs an offset. His group made that point in a letter to House members last week.
“Our concern is that means testing is becoming Congress’ ATM when they’re looking to pay for this piece of legislation and other pieces of legislation, too,” Adcock said.
With the exception of some conservative groups, including Heritage Action for America, it’s mostly these seniors’ groups who are frustrated by the deal. Hospitals are also being required to contribute, through delaying future payment increases and extending payment cuts for facilities that serve the low-income. But they see the benefits outweighing the costs.
“We’d prefer to see none, but frankly the cost to us of these is worth the price considering that we’re going to end this merry-go-round of bad policy and cuts,” said Chip Kahn, president of the Federation of American Hospitals.
It’s always been cheaper and easier for Congress to pay for temporarily patching the payment cut one year at a time, and it’s done so 17 times. The offsets are often collected from a smorgasbord of policy changes.
Last year, lawmakers paid for a one-year “doc fix” by pushing Medicare sequester cuts into 2024 and changing the way skilled nursing facilities and clinical labs are paid, along with extending cuts to hospitals that have disproportionate shares of low-income patients and mandating repairs to physician payment codes.
The deal this year isn’t set in stone. The House is likely to pass it on Thursday, but the Senate probably won’t get to the legislation until after a two-week recess that starts Friday. And with dissension continuing to swirl around other elements of the bill — the question of how long to extend the government health insurance program for children, for example — it could easily get modified.
The current payment patch expires at the end of March, but the federal government is able to avoid the payment plunge for several weeks, giving Congress more time to forge a deal.
