The federal Centers for Medicare and Medicaid Services (CMS) is estimating that average overall physician fees for doctors participating in Medicare will drop by 4.3 percent in 2006, and over the following six years payments are projected to dive by 26 percent.
In a recent letter to the Medicare Payment Advisory Commission, Herb B. Kuhn, director of the Center for Medicare Management at CMS, noted that the projected decrease in physician payments is tied to rapidly rising costs for services paid for by the program, particularly those related to treatment of chronic conditions.
Kuhn wrote that “the major contributors to the rapid increase in spending appear to be certain diagnostic and therapeutic services, including services particularly important in the treatment of chronic illnesses: more frequent and more intensive follow-up visits, more frequent and more complex imaging, more frequent and more intensive minor procedures such as physical therapy, more frequent and more complex laboratory tests, and increased use of drugs in physicians' offices.”
Nicholas Meyers, director of APA's Department of Government Relations, said the projected pay cut reflects permanent flaws in the government's formula for paying doctors.
“The recurring threat of substantial reductions in the Medicare payment update is a problem for all physicians and other health professionals,” Meyers told Psychiatric News. “This is especially true for psychiatrists, who because of the nature of the services they provide—which are bound mostly by time—are impacted the most by the flawed payment formula.
“Congress must evaluate the current payment formula and take action to fix the problem permanently rather than postponing it a year or two at a time,” Meyers said. “We will continue to work with the AMA and the rest of medicine to achieve this goal.”
The AMA again voiced its longstanding opposition to a payment formula that ties payment to the amount of services rendered.
“These cuts present a serious threat to access to care for seniors,” said J. James Rohack, M.D., chair of the AMA Board of Trustees, in a press release. “No senior citizen should have to worry whether [his or her] physician can afford to accept Medicare patients, but if these steep cuts go into effect, physicians may have to make hard choices about taking new Medicare patients.
“Congress and the administration must act now to replace the flawed physician payment formula, which penalizes physicians for providing necessary care to Medicare patients,” Rohack continued.
“Medical advances such as research breakthroughs, innovations in technology and a focus on preventive care are improving the health of America's patients, but they are also increasing the number of medical services seniors need. New treatments to fight cancer and prevent blindness have improved the quality of life for millions of elderly and disabled Americans. Physicians should not be penalized for these successes.”
More information is posted on the CMS Web site at<www.cms.hhs.gov/physicians/medpac.pdf>.▪
