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Congressman Pascrell Joins House Ways And Means Committee Colleagues In Voting For Updating Medicare Reimbursements To Physicians

Press Release

Location: Washington, DC

Congressman Pascrell Joins House Ways And Means Committee Colleagues In Voting For Updating Medicare Reimbursements To Physicians

In keeping with legislative efforts to make quality health care affordable for every American, U.S. Rep. Bill Pascrell, Jr. (D-NJ-8) today voted in favor of repealing a looming 21 percent cut in Medicare payments to physicians while a more stabilized reimbursement system is developed.

The short-term benefit of Medicare Physician Payment Reform Act (H.R. 3961), which passed in the House today by a vote of 243-183, is that seniors will avoid a disruption in their health care because their doctors won't face a massive cut in their Medicare payments scheduled to go into effect in January 2010. The long-term benefit of the bill is that it will stop the perennial cycle of the past seven years of deeply cutting Medicare physician payments in the federal budget, only to be followed by Congress removing the cuts before the budget vote.

"Each year, these temporary cuts delay the inevitable and make subsequent cuts and fixes that much harder to swallow. This is simply unsustainable," said Pascrell, a member of the House Ways and Means Committee, which oversees Medicare. "Providing a realistic, long-term solution that embraces a legitimate effort to rein in spending, while recognizing the value of primary care, is a necessary foundation to true reform. Without it, it's like building our house on the sand -- a foundation of sand that not only jeopardizes access to care for 45 million seniors and individuals with disabilities but also has important consequences for our entire physician workforce."

Instead of temporarily overriding the cut, as Congress has done six times before, H.R. 3961 will replace the broken Sustainable Growth Rate (SGR) formula to account for realistic changes in the nation's overall spending on health care services. Since its enactment, the SGR formula has used cumulative, outdated national spending data as its basis for setting Medicare payments to physicians. Under the old formula, if spending grew faster than the SGR, Medicare payment cuts would be triggered.

Health care costs have outpaced the SGR in recent years, and both Republican- and Democratic-led Congresses have been forced to intervene every year to spare physicians and other health care providers from draconian cuts in Medicare payments. Because the SGR formula is cumulative, these temporary payment freezes or increases enacted by Congress have exacerbated the depth of future cuts called for by the SGR.

The Medicare Physician Payment Reform Act corrects this with a new formula with targets for health care spending that work to rein in spending in a realistic manner. The new formula allows overall spending for primary care services to grow by the rate of inflation plus 2 percent and overall spending on other health care services to grow by the rate of inflation plus 1 percent. The bill provides that the new formula will be rebased every five years.
In addition to protecting Medicare beneficiaries' access to health care, H.R.3961 also benefits members of the military and their families since physician payment rates in TRICARE are tied to those used by Medicare.

Among the organizations that have endorsed the bill are the American Medical Association, the AARP, the Military Officers Association of America, the American Academy of Family Physicians, the American College of Physicians, the American College of Surgeons, the Center for Medicare Advocacy, the Medicare Rights Center, and the National Committee to Preserve Social Security and Medicare.

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