Medicare Fix Update

Congress is facing a deadline for action on Medicare. Unless lawmakers step in, radiologists and all doctors treating Medicare patients will see a 27 percent cut in reimbursements in January. House Republicans are now proposing to stave off the steep cut in Medicare payments. The plan by Ways and Means Chairman Dave Camp of Michigan would replace a cut of more than 27 percent with 1 percent increases for 2012 and 2013.

This $39 billion “doc fix” would be mainly paid for by increasing Medicare premiums for upper income retirees, along with some cuts in spending authorized by President Barack Obama’s health care overhaul.

How did we get into this mess? A statutory formula (SGR) sets annual goals for Medicare spending on doctors’ services. When actual spending exceeds the goals, payments to doctors are supposed to be reduced. If Congress intervenes to block a cut – as it often does – Medicare is supposed to recoup the money by making deeper cuts in future years. The current 27 percent cut in reimbursement doctors are facing in 2012 is the accumulation of many years of temporary fixes.

ADVOCATE will keep you informed as news becomes available.

Best regards,
Kirk Reinitz, CPA
President & CEO