Potential Medicare payment cuts alarm doctors, hospitals

August 03, 2011|By Tracy Jan and Theo Emery, Globe Staff

WASHINGTON - Fourteen years ago, Congress passed a bill cutting Medicare payments to doctors in a move to reduce the federal deficit. But every year since, lawmakers have caved to pressure from doctors and held off the cuts, demonstrating the lobbying power of a profession that is once again in the crosshairs of congressional budget-cutters.

Slashes to Medicare payments to doctors and hospitals are among the automatic cuts - along with deep slices from the Pentagon budget - that will occur in December if Congress does not accept $1.5 trillion in deficit reduction proposals from a bipartisan committee that will be free to propose tax hikes or cuts in Social Security. If those choices are a rock, the history of the 1997 law shows that reducing Medicare payments to doctors is a hard place.

Lobbyists for doctors and hospitals are sounding alarms, asserting that the cuts, which politicians claim will not affect Medicare beneficiaries, would harm patients by affecting their access to and quality of care.

“This is a very serious problem for us,’’ said Dr. Lynda Young, president of the Massachusetts Medical Society. “Obviously we recognize the need for cost cutting, but the depth of the projected cuts is really going to have a serious impact on access. Physicians are going to say, ‘We can’t take any new Medicare patients because we just can’t survive.’ ’’

Cuts to Medicare would be capped at 2 percent of current Medicare spending, or roughly $11 billion a year for a 10-year savings of approximately $130 billion, said Eric Zimmerman, a Washington attorney and lobbyist for the hospital industry. Details of how the cuts would be carried out remain to be seen, but Zimmerman says it could mean a flat 2 percent reduction in payments to Medicare providers, including doctors, hospitals, nursing homes, and private insurers that offer plans with Medicare benefits.

“There will be a lot of hand wringing and anxiety over the next four months as we work through this process,’’ said Zimmerman, a Medicare specialist and partner with McDermott Will & Emery. “Health care providers right now are trying to weigh whether they would be better or worse off with the [automatic] cuts or whatever the committee recommends.’’

And even though physicians have managed to stave off deep cuts in the past, jittery health care providers say they feel under attack once again. Doctors already face a 30 percent cut in January to their Medicare payments, said Young, though she acknowledged that in the past, Congress has always managed to fend off the cuts at the 11th hour.

Advertisement
Advertisement
|
|
|
|