Congress Again Postpones Medicare Pay Cuts for Doctors

In what has become an all-too-familiar ritual, the House of Representatives on Thursday voted to postpone a 25% Medicare pay cut for doctors that was scheduled to take effect Jan. 1.

The 409-2 vote came after the Senate voted unanimously in favor of the one-year delay. President Barack Obama --who has encouraged Congress to "act quickly on this proposal" to stabilize Medicare, the government's health program for the elderly and people with certain disabilities -- now has to sign the bill into law.

The doctors' pay cuts are the result of a budget-balancing formula, which was created in 1997 to annually adjust Medicare rates to match economic growth. But what started as a measure to keep Medicare spending in the black has since become an unreasonable formula, some have argued. Since doctors first faced a reduction in their Medicare reimbursements in 2002, Congress has waived the cuts 10 times -- and five times this year alone.

The Doc Fix and other provisions of the newly passed bill will cost $19.2 billion over the next 10 years, according to the Congressional Budget Office. Money related to health insurance subsidies -- from a provision in the health-care reform bill -- will foot the bill.

A Permanent Fix on the Way?

Of course, the president wasn't the only one pressuring Congress to delay the pay cuts. Doctor groups also lobbied heavily, saying many doctors would stop taking new Medicare patients if the cuts took effect.

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"Stopping the steep 25% Medicare cut for one year was vital to preserve seniors' access to physician care in 2011," Dr. Cecil Wilson, president of the American Medical Association, said in a statement. "Many physicians made clear that this year's roller coaster ride, caused by five delays of this year's cut, forced them to make difficult practice changes like limiting the number of Medicare patients they could treat."

Medicare Rights Center President Joe Baker encouraged Congress to find a more permanent solution. "We also hope that Congress uses the next year to work with the Centers for Medicare and Medicaid Services to create a long-term fix that preserves Medicare patients' access to care and relationships with their physicians."

Obama seems to agree, despite the high price tag that would come with such a solution. "For too long, we have confronted this recurring problem with temporary fixes and stopgap measures," Obama said Wednesday. "It's time for a permanent solution that seniors and their doctors can depend on, and I look forward to working with Congress to address this matter once and for all in the coming year."

Some 46.6 million people received Medicare benefits in 2009.