Medicare and Tricare patients may have difficulty finding a family doctor if Congress fails to address a 21-percent cut to Medicare reimbursement rates that took effect Monday, say some local doctors.
"Patients are already having a hard time finding a doctor who will take Medicare ..." said Dr. Ken Diamond, a Rapid City family physician. "This is going to be really catastrophic."
Monday marked the end of a Congressional extension delaying cuts to Medicare reimbursement rates.
The 21-percent cut now in effect is the result of a sustainable growth rate formula enacted in 1997. The SGR is used to set Medicare reimbursement rates for physician care. Tricare is affected by the SGR as well.
Dr. Thomas Dean, a member of the Medicare Payment Advisory Commission and a physician in Wessington Springs, said the SGR formula works by adding total expenditures for physicians annually. If expenditures exceed a set rate, cuts are made to Medicare reimbursements for the following year.
Dean calls the logic behind the SGR formula flawed because it lumps all doctors together. "The incentives that are built into the law are really perverse because if you are conservative physician and really hold down expenses ... you get cut just like the extravagant people," he said. "There's no incentive."
For the past nine years, annual expenditures have exceeded the set rate. But instead of implementing the reimbursement rate cuts for the next year, Congress has delayed them year after year, allowing them to add up.
"It accumulates. That's why we are facing the really Draconian cut of 22 percent," Dean said. "To really fix it has some major budgetary implications now because they've put it off so long."
Three years ago, Congress asked the Medicare Payment Advisory Commission, called MedPAC, to evaluate the SGR law.
"MedPAC was very critical of it," Dean said. MedPAC serves as an advisory board for Congress on Medicare and Medicaid payments.
Dean said MedPAC recommended Congress repeal the SGR formula law or extend the law to all health care providers. Currently, it only affects doctors.
Congress failed to act on the recommendations, Dean said.
"Congress, they understand it's a problem ... But because they have delayed a response, they have dug themselves into a much deeper hole. It's several hundred billion dollars now," he said.
The Centers for Medicare & Medicaid Services, also called CMS, has extended its deadline to doctors beyond March 1 in order to give Congress time to either repeal the law or extend the deadline.
Doctors have until March 17 to choose between remaining a participating Medicare/Tricare physician or become a non-participating doctor. Non-participating providers will see just a 9-percent reimbursement cut, but will be forced to bill patients directly. Patients will be reimbursed directly by Medicare.
Doctors can also choose to stop seeing Medicare or Tricare patients.
If a solution is found by Congress in the next two weeks, it is expected that CMS will cover Medicare/Tricare claims retroactively.
But is a solution within reach?
The House of Representatives passed a 30-day extension on the rate cut last week, but the bill was blocked in the Senate by Sen. Jim Bunning (R-KY), according to the American Medical Association.
The AMA is pushing lawmakers to repeal the formula entirely.
The Senate is expected to reconvene this week to consider a "bill with longer-term extenders," according to the AMA.
Rep. Stephanie Herseth Sandlin (D-SD) released a statement saying, "Now that the House has passed this legislation that would prevent cuts this month in Medicare reimbursement to doctors, I hope that the Senate will be able to overcome the roadblocks that have been put in the way of ensuring continued access to needed health care for South Dakota's seniors."
Sen. Tim Johnson (D-SD) released the following statement regarding the Senate battle. "Congress has consistently acted to prevent scheduled cuts in Medicare reimbursement, and while I am hopeful we will soon pass another extension, I am disappointed one Senator is obstructing action in the Senate. I am also committed to putting in place a more permanent solution that provides stability for patients and our health care professionals in the long run."
Sen. John Thune (R-SD) also responded in part, "Hopefully this is a temporary situation and Congress will act quickly to address this situation," said Thune.
Diamond and Kevin Weiland view Monday's Medicare reimbursement rate decrease as a "catastrophic" event for doctors and patients, especially the Baby Boomer generation.
Family physicians and internists, doctors who carry a heavy Medicare patient load, already struggle with low reimbursement rates, Weiland said. As a result, medical students are turning away from those specialties.
"They cut primary care any more and then they have nobody who will go into primary care," Weiland said.
Weiland said doctors often finish their schooling with $200,000 in loans. Lower-paying specialties such as primary care look far less attractive to them than such specialties as cardiology, where reimbursement rates are higher.
Those decisions leave a void in the primary care area of medicine.
In the Rapid City area, the average age of physicians is 50 years, Weiland said. As doctors near retirement, they are finding fewer people stepping in. "As far as primary care goes, no one is replacing us," he said. "There's no here to fill the void in our community."
For those doctors already practicing, they are being forced to make the hard decisions.
"We are limiting our Medicare patients as we speak," Weiland said. "The bottom line is who's going to be hurt the worst is the Medicare population."
Diamond said Medicare already pays him just 2 percent more than it did in 2001, while his costs have increased by 22 percent. Another 21 percent cut could be devastating. "Any margin on seeing Medicare patients is gone ... I'm probably losing money."
Until something happens in Washington to change the current reimbursement scenario, Diamond and doctors like him cautiously plan for the future.
"Right now, I'll wait to see how things look when the dust settles," Diamond said. "But I'll have to do something to keep my doors open."
Contact Lynn Taylor Rick at 394-8414 or firstname.lastname@example.org.