Budget bill makes Medicare payment changes
Posted on: Monday, 19 December 2005, 17:00 CST
WASHINGTON (Reuters) - The spending-cut bill approved by the U.S. House of Representatives on Monday and pending in the U.S. Senate slows Medicare spending over the next five years, mostly by changes in payments to providers.
The net savings are $6.4 billion -- after a $7.3 billion expenditure to wipe out a 4.4 percent pay cut to doctors that would otherwise have gone into effect in 2006 under a widely disliked payment formula.
Congress did not come up with a long-term fix to that doctor-fee formula, and unlike other recent years doctors will not get any fee increase next year from the Medicare program, which covers all Americans from age 65 and many disabled people.
"By freezing payments at 2005 rates, the House has stopped a planned 4.4 percent payment reduction that would force physicians to limit the number of new Medicare patients they take into their practice," American Medical Association President Dr. Edward Hill said in a statement.
The bill did pare back by $6.5 billion a "risk adjustment" fund that pays private managed-care plans that participate in Medicare.
The House-Senate compromise did not, however, cut a separate "stabilization" fund -- Democrats call it a "slush fund" -- that independent experts have identified as an overpayment to health plans. The Senate had voted to cut it.
The bill freezes home health care payments, saving $2 billion and curtails payment rates for imaging such as MRIs by $2.8 billion over five years.
It speeds up implementation of a requirement, approved in 2003 as part of the Medicare drug-benefit law, that wealthier older Americans pay higher monthly premiums for their health coverage.
The bill also includes new measures designed to ensure that hospitals improve their quality reporting. It did not include proposals put forth earlier this year to link doctors' payments to their performance.
Source: REUTERS
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