Doctors ‘Disgruntled’ And Frustrated By Looming Medicare Cuts

by JULIE ROVNER
February 16, 2012

A looming 27.4 percent cut in Medicare reimbursements likely won't happen. But next year, any cuts could be greater.

The good news for the nation's doctors — and the millions of Medicare patients they care for — is that assuming everything goes as planned, the 27.4 percent cut in reimbursements that would have taken effect March 1 won't.
The bad news? The fix included in the deal to extend the payroll tax holiday isn't permanent. It only extends to the end of the year. And then, if Congress doesn't act again, the cut it is expected to be will be in the neighborhood of 32 percent.

That's leaving doctors in a continuing state of uncertainty.

"Disgruntled is probably just too soft of a term for this," says Robert Wah, a reproductive endocrinologist at the National Institutes of Health and the Walter Reed Army Medical Center. He's also Chairman of the Board of Trustees of the American Medical Association. "It's really devastating to try to run an office in this environment."

Wah says doctors have been through this exercise before — waiting to see if Congress will stop a scheduled Medicare cut. Too many times.

"In 2010, Congress did this to us five times," he said. "There were five patches put in place, and a couple of times they actually waited until after the deadline," which meant payments were delayed.

Wah says many physicians are also small businesses. So the uncertainty of knowing how much — or in some cases whether they're going to be paid to see their Medicare patients, is more than just an inconvenience. "Because they have to continue to pay their rent and their insurance and their electric bill and the salaries of the people that work in their office," he says.

Until now, the public hasn't had a lot of sympathy for the plight of America's doctors and their Medicare woes. Despite their complaints, doctors still earn a lot more than the average American. And surveys showed that most doctors continued to treat Medicare patients.

This problem with how Medicare pays doctors is the result of a funding formula enacted in 1997 that's since gone awry. It affects many members of the military, too, because rates for the TRICARE health program are tied to those for Medicare.

But over time it has been gradually eroding what doctors earn to care for those patients. That's because while Congress mostly hasn't let the scheduled cuts take effect, it also hasn't given doctors a raise, either. The result, says Wah, is "there's now a 20 percent gap between... the cost of taking care of the folks in the Medicare and TRICARE system and the lack of increase in our fee schedule."

Now that's starting to have an impact on patients, says Paul Ginsburg, president of the Center for Studying Health System Change, a health research think tank. Ginsburg says most Medicare patients aren't having trouble getting care because they're not changing doctors. But with many doctors not taking new Medicare patients, there is starting to be an access problem.

"Someone who needs another doctor, either because they've moved, or their doctor is retired or they just don't like their doctor anymore; those are the people bearing the brunt of whatever access limitation we have," Ginsburg says.

But Ginsburg says he's also worried about something else — the increasing gap in pay between primary care doctors, like family practitioners, and internists and specialists. Particularly now, he says.
"We really are looking to primary care physicians to play a bigger role, to coordinate care, to manage chronic disease, and not just to do piece work," he says. But "at the same time we're envisioning a changed role...we're making primary care much less attractive."

Those changes to the health delivery system are the result of the 2010 health overhaul. And it did include some payment increases for primary care doctors in Medicare. But it didn't fix the overall doctor payment problem — largely because it cost too much.
And while there were a few hints that Congress might be getting ready to fix it using unspent funds from the wars in Iraq and Afghanistan, that didn't happen. Which is why Wah and his colleagues are getting increasingly frustrated.

"Our organizations are committed to helping Congress develop better ways to pay physicians and deliver care to patients," said a joint statement from the American Academy of Family Physicians, American College of Physicians, American College of Surgeone, and American Osteopathic Association. "(B)ut Congress must do its part and enact permanent repeal of the (current funding formula) —before 2012 comes to a close."