Part B Insider (Multispecialty) Coding Alert

Published on Wed Jul 26, 2006 PDF

Fixing problems could cost $218 billion, CBO warns

Contact your Congress member: You should urge your representatives to support H.R.5866, the Medicare Physician Payment Reform and Quality Improvement Act. Introduced July 24 by Rep. Michael Burgess (R-TX), a physician, H.R.5866 would:

- replace the broken physician payment update formula with a new system based on the Medicare economic Index (MEI). Instead of a 4.7-percent cut, next year you-d receive a 1.8-percent payment boost, based on the MEI's estimate of cost increases, minus 1 percent.

- establish quality measures for physician services and allow physicians to report those measures voluntarily. This would also allow patients to choose high-quality doctors.

- delay changes to payments for  imaging services by one year. During that time, the Department of Health & Human Services would contract with the Institute of Medicine to study the utilization and appropriateness of imaging services, examining -the role of defensive medicine- and whether imaging scans save money by reducing the need for procedures.

The influential Medicare Payments Advisory Commission (MedPAC) endorsed a system similar to the Burgess bill-s, in a July 25 hearing of the House Energy and Commerce Health Subcommittee. But MedPAC would impose pay-for-performance, where physicians receive money for quality, instead of the voluntary program Burgess proposed.

Meanwhile, the Congressional Budget Office warned that any boost to physician payments will cost Medicare dearly. Just increasing physician's pay by 1 percent in 2007, without affecting future cuts, would cost $13 billion from 2007 to 2013. Increasing pay by 1 percent in 2007 and adjusting future cuts to compensate would cost $31 billion from 2007 to 2016. The Burgess bill's proposal would cost $218 billion extra between 2007 and 2016, the CBO warns.

Commentary: -The $64,000 question- is whether Congress can find the money to avert another cut of nearly 5 percent for next January and delay next year's deep cuts to imaging, says North Carolina radiologist William Thorwarth. Congress will at least act to prevent overall cuts to avoid a physician exodus from Medicare, predicts Thorwarth.