Delayed Medicare pay cut a temporary fix

September 1, 2010

The 6-month postponement of the proposed 21% reduction in Medicare physician rates should have gone farther, according to ACOG leaders.

The 6-month postponement of the proposed 21% reduction in Medicare physician rates (replaced with a temporary 2.2% rate increase) should have gone farther, according to leaders at the American Congress of Obstetricians and Gynecologists (ACOG).

Gerald F Joseph Jr, MD, ACOG immediate past president, explained the problems with the sustainable growth rate (SGR) formula created by Congress in 1997 that requires Medicare payment rates to be modified annually in order to ensure that Medicare beneficiary spending does not outpace the per capita increase in the gross domestic product. Joseph said in an ACOG Web seminar in mid-July that there are several factors outside of the control of physicians that can negatively affect the formula, including the cost of office-administered drugs, the cost of medical liability, and the cost of additional Medicare services and benefits.

"The result has been annual decreases in physician reimbursement that have had to be overcome by Congress each year," Joseph explained. "Instead of a permanent 'fix,' Congress has elected to 'kick the can' down the road."

Joseph GF, DiVenere L. What the law means to your practice and your patients. ACOG Health Reform Webinars. July 14, 2010. http://www.acog.org/departments/govtrel/20100714presentation.pdf. Accessed August 20, 2010.