Battle of the Bilge

Update on Medicare Payment Issue

In the last CBO/TRICARE article, we mentioned the failure of the Medicare Physicians Fairness Act (S. 1776).

That bill would have permanently repealed Medicare’s Sustainable Growth Rate. If the SGR is not repealed or pushed back, Medicare providers would see a 21.5% cut in payments in January, 2010.

We also predicted that it would be placed into another bill by the end of the year to push off the problem until a later date. While we thought the HCR bill would be the most likely candidate, it turns out that the language for the SGR push back was included in the FY2010 Defense Appropriations Act (H.R. 3326), a ‘must pass’ bill that is now awaiting the president’s signature.

A temporary fix was placed in the bill, extending SGR by a period of only 2 months, so the battle is far from over, just delayed as Congress tends to do with these types of fiscal issues.

Last Friday’s Legislative Update provides the details:

Big Medicare/TRICARE Cuts Delayed – For 60 Days
The Senate has been so consumed by the partisan politics of national health reform that other end-of-year crises have had to take a back seat.

In recognition of one urgent issue, the Senate will pause Saturday morning to pass the FY2010 Defense Appropriations Act (H.R. 3326) – a mere 80 days after FY2010 actually started.

Included in that legislation is an emergency measure to delay a 21% cut in Medicare and TRICARE payments to doctors that otherwise would take effect on January 1.

Unfortunately, because Republicans and Democrats can’t agree on funding issues, the new legislation will only delay the Medicare/TRICARE payment cuts until the end of February.

That means two more months of wrangling in hopes that Hill leaders can work out a longer-term doctor payment fix. This is crucial to Medicare and TRICARE beneficiaries, because a 21% payment cut would cause thousands of doctors to stop taking them as patients.

Nobody in Congress wants that to happen. But their continuing squabbles over how to fund a fix – and their continuing games of last-minute budget “chicken” – continue to put millions of beneficiaries at risk.

Meanwhile, the Senate still hasn’t addressed another issue that will affect millions of Medicare-eligible beneficiaries if Congress doesn’t act in the next 13 days.

Under current law, people turning age 65 in 2010 and those with incomes above $85,000 ($170,000 for a married couple) will face steep Part B premium increases (scroll to the middle of the page) as of Jan. 1. Other Medicare-eligibles are protected by a law that bars Part B premium hikes in years when there’s no Social Security COLA. But there’s no such protection for the 25% of beneficiaries who will first become eligible for Medicare next year or who have higher incomes. And those groups will get hit with extra premiums to help make up for the fact that the other 75% won’t be paying more.

The House passed legislation (H.R. 3631) in September to bar Part B premium hikes for all Medicare-eligibles. But the Senate has not acted on it because of an objection by Senator Tom Coburn (R – OK). You can press your senators for action by sending them a MOAA-suggested message.

You Can Help

To help MOAA speak in a loud and clear voice, please take the time to contact congress on these issues:

Stop 21% Medicare/Tricare Payment Cut

Pass the Medicare Premium Fairness Act

Protect Military/VA Beneficiaries Under Health Reform

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