House Postpones Medicare Payment Cut Until March

Janice Simmons, for HealthLeaders Media , December 16, 2009

Looking to wrap up a variety of end of session items Wednesday, the House of Representatives incorporated into its $636 billion defense spending bill a provision that will prevent a 21% cut in Medicare payments to physicians until March 1.

Last month, the House, voting mostly along party lines, approved a bill (HR 3961) that would have prevented a 21% cut in the Medicare physician payment rate scheduled at the beginning of January 2010. The bill, known as the Medicare Physician Payment Reform Act, calls for replacing the sustainable growth rate (SGR) formula, that was enacted more than a decade ago to help keep physician costs down. A similar bill was turned down in the Senate.

In previous years, Congress has stepped in annually to override the cuts called for with the SGR. However, major medical groups, noting that time was running out, said they would support a short postponement of the cuts so that Congress would have time to pass healthcare reform legislation.

In a Dec. 15 letter to Senate Majority Leader Harry Reid (D-NV), national medical groups, including the American Medical Association, and state medical societies said that "because Congress has repeatedly 'kicked the can' to postpone imminent payment cuts to future years," they are "facing impossibly severe cuts." At the same time, "the cost of repealing a formula whose faults have been known since its inception has continued to grow, from $49 billion in 2005 to over $200 billion today."

After Wednesday's vote, J. James Rohack, MD, president of American Medical Association, released a statement: "Ensuring continued access to physician care for America's seniors is critically important, which is why Congress must fix the broken Medicare physician payment formula once and for all. The AMA acknowledges today's vote in the House to temporarily suspend for two months the 21% Medicare physician payment cut that begins in three weeks, as this will allow physicians to continue to care for Medicare patients while waiting for the Senate to vote on a permanent solution."

He added that the House already passed HR 3961, which would replace the "broken Medicare physician payment formula with a system that better reflects the cost of providing 21st century medical care." The AMA urged the Senate to take similar action so the president could sign the law early next year.

Janice Simmons is a senior editor and Washington, DC, correspondent for HealthLeaders Media Online. She can be reached at

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