Filed Under:Health Insurance, Medicare

Democrats praise GOP doc fix effort

Rep. Henry Waxman, D-Calif. (C-SPAN image)
Rep. Henry Waxman, D-Calif. (C-SPAN image)

Republicans and Democrats in the House have worked together to draft a bill.

The draft bill -- an "advanced legislative framework -- would replace the current Sustainable Growth Rate (SGR) system for setting Medicare doctor reimbursement system with a new system that would try to take both quality and efficiency into account.

A team at the House Energy and Commerce health subcommittee developed the draft, and the subcommittee is planning to mark up the draft Monday.

Rep. Michael Burgess, R-Texas, a medical doctor who is te vice chairman of the subcommittee, led the drafting effort.

House Energy and Commerce Committee Democrats have put out a statement calling the effort to draft the bill a "careful and bipartisan process" that used a "transparent process" to involve both lawmakers and stakeholder organizations.

Rep. Henry Waxman, D-Calif., the highest ranking Democrat on the full committee, said in the statement that the bill is a "work in progress" that could be improved.

"But I believe we already have a stronger product because of our joint effort," Waxman said. 

Medicare now pays doctors a fee for each service rendered.

Congress tried to fix the fee-for-service system in the Balanced Budget Act of 1997 (BBA) by tying growth in Medicare doctor pay to growth in U.S. gross domestic product (GDP). 

Since 1997, U.S. physician fees have grown much more quickly than GDP.

Congress has never let the SGR law take effect.

If Congress let the SGR system take effect as written, the adjustments needed to bring growth in Medicare doctor pay in line with growth in GDP would lead to a 27 percent cut in physician reimbursement rates, analysts estimate.

Changes in the Medicare provider reimbursement system could have a big effect on commercial health insurance plans, because commercial health plans often come up with the rates they pay the doctors in their networks by using the Medicare rate as a benchmark. For many procedures, carriers may multiply the Medicare benchmark by a percentage, such as 150 percent, or 175 percent, to get the private-pay rate.

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