After Congress returned from its recent recess, members agreed to delay the 21% physician pay cut until June 1, 2010. Meanwhile, physician organizations, like the American Medical Association (AMA), are urging Congress to permanently repeal the Medicare physician payment formula.
The legislation, the Continuing Extension Act of 2010, was signed into law by President Obama on April 15. This legislation extends through May 31, 2010, the zero percent update to the Medicare Physician Fee Schedule (MPFS) which was in effect for claims with dates of service from Jan. 1, 2010, through March 31, 2010. The law is retroactive to April 1, 2010.
The Centers for Medicare & Medicaid Services (CMS) has instructed Medicare contractors to begin processing claims under the new law for services provided by physicians, non-physician practitioners (NPPs) and others paid under the MPFS. Most claims with dates of service April 1 and later were held by Medicare in anticipation of congressional action. If Congress had not acted, payment rates for these services by physicians, NPPs and others who are paid under the MPFS would have been reduced, as required by a formula specified in the Medicare law.
“…Congress again delayed the 21 percent Medicare physician payment cut until June 1 to avoid a Medicare meltdown for seniors,” said J. James Rohack, MD, president of the AMA. “Repeated delays and continued uncertainty combined with the fact that Medicare payments, even without the 21 percent cut, have not kept up with the cost of providing care to seniors demonstrates the need for a permanent solution to this annual problem.”
The negative update, originally scheduled to go into effect for services paid under the MPFS on or after Jan. 1, 2010, was postponed until March 1 by a provision in the Defense Appropriations Act of 2009, and again until April 1, in the Temporary Extenders Act of 2010.
The AMA urged Congress to permanently change the payment formula. “Congress must now turn toward solving this problem once and for all through repeal of the broken payment formula that will hurt seniors, military families, and the physicians who care for them,” Rohack said. “It is impossible for physicians to continue to care for all seniors when Medicare payments fall so far below the cost of providing care. In an informal poll, 68 percent of physicians tell the AMA they will be forced to limit the number of Medicare patients they can care for. Fixing the Medicare physician payment problem is essential to the security and stability of Medicare.”