Doctors Need a Permanent Fix to the Medicare Payment Mess

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Allowing reductions of this magnitude would be hugely detrimental to the quality of care available to seniors under the program. In 2008, The Heritage Foundation explained that “The current Medicare payment system is financially unsustainable, threatens Medicare patients’ access to care, and adds to uncertainties about the adequacy of the future physician workforce.” For these reasons, Congress must clean up the physician payment mess it has created once and for all—and pay for it, too.

According to the Congressional Budget Office, holding physician payments constant through the end of this decade would add $276 billion to federal spending. Congress should pay for a permanent “doc fix” using savings in Medicare created under the Patient Protection and Affordable Care Act, rather than using them to offset the cost of new federal health care entitlements.

Then, as Moffit details, Congress should set payment increases on a more rational growth rate. First, he suggests, they should index physician reimbursement to inflation as measured by the Consumer Price Index, making physician payments stable and predictable for doctors and patients alike. Second, Congress should allow balanced billing by Medicare physicians, which was restricted by legislation passed in 1989. This would allow providers to charge patients for the remainder of the real cost of services that are not covered by Medicare. Third, Congress should require physicians to disclose their prices for medical treatments and procedures. Fourth, Congress should require the Medicare Payment Advisory Commission to conduct market surveys to determine areas and specialties in which physicians are being underpaid or overpaid, and to make recommendations to Congress on how to alleviate imbalances.

Beyond these changes in Medicare physician payment, Moffit argues that government should not interfere in any way with purely private agreements between doctors and patients for legal services that do not involve taxpayer funding. Moffit writes, “Congress should also allow doctors and patients to go outside of the Medicare program and contract privately for Medicare services without statutory or regulatory obstacles.” Private contracting was statutorily restricted by the Balanced Budget Act of 1997, and that legislative restriction was imposed on no other government health program.

Ultimately, problems caused by the flawed SGR are but a symptom of flawed central planning and bureaucratic micromanagement of seniors’ care under Medicare. Reforming the program and changing it to a defined-contribution system, like Medicare Part D, would not only resolve the physician payment mess, but it would address other mounting concerns, such as the program’s financial insolvency and its inability to achieve greater efficiency and better value.

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Source material can be found at this site.

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