OF ALL the manifestations of Washington dysfunction, none is more absurd than the annual “doc fix.” The origins of the problem lie in a 1997 attempt by Congress to rein in Medicare physician reimbursements. Lawmakers devised a “sustainable growth rate” that was supposed to link payments to statistical indicators of doctors’ costs and workload. Alas, the growth rate perversely encouraged excessive tests and procedures; when it actually began to reduce physicians’ pay rates significantly in 2003, medical lobbies got it temporarily repealed in what turned out to be the first of 16 doc fixes. The cumulative cost of these fixes now exceeds $150 billion, and the most recent one expires March 31.
The Medicare Payment Advisory Commission has proposed any number of ways to reform the payment system, but Congress has balked at a permanent doc fix because doing away with the current rules, however discredited, would force lawmakers to acknowledge a huge hole in the federal budget. Filling it would require either taxes or spending cuts; most past short-term “doc fixes” have been paid for with offsetting health-care trims.
Last year, the Congressional Budget Office ran the numbers again, factoring in the recent slowing of growth in health-care costs, and determined that the tab might be about $140 billion over 10 years, not $300 billion, as previously thought. That encouraged both the House and Senate, Democrats and Republicans, to seek a permanent solution while it was, in effect, “on sale.” Each chamber is working on a bill that would essentially keep the current reimbursement rate unchanged for the next five years, after which a new system that tilts physicians’ incentives in favor of quality of care, not quantity, would take effect.
Alas, even when a permanent doc fix could be had for cheap, it turns out that Congress can’t, or won’t, agree on a plausible way to pay for it. The Republican-controlled House passed a bill that would come up with the money by — you guessed it — delaying Obamacare’s individual mandate for five years, which would be unwise policy even if it weren’t blatant political grandstanding and, hence, a non-starter. Over in the Senate, Finance Committee Chairman Ron Wyden (D-Ore.) is talking about either not paying for the bill at all or doing so by “cutting” the projected costs of overseas military operations that exist only on paper.
To be sure, it makes a kind of sense, in Washington terms, to stop pretending that you were ever going to cut doctors’ fees and pay for that by “saving” money that you were never really going to spend. Still, past doc-fix pay-fors were mostly real — to the tune of $140 billion, according to the Committee for a Responsible Federal Budget — and derived from health-care programs.
Now is not the time to break that fiscally sound precedent, not even to get a permanent doc fix. Better to pass another short-term fix and keep working on a genuine way to pay for a permanent one.
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