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Hospital Report

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The premier resource for hospital professionals from Relias Media, the trusted source for healthcare information and continuing education.

What the tax cut fight means for Medicare

January 12th, 2015

It’s been politics as usual on Capitol Hill, this time with the bickering over the payroll tax cut extension taking center stage. The House rejected the Senate’s bipartisan extension bill, and is instead wanting both chambers to conference for a solution. And while the lawmakers can’t agree on what to do or when to do it, Medicare doctors and patients are set to feel the consequences of the indecision.

Included in the contested bill is a provision that would waive a 27.4% cut in Medicare reimbursements to nearly 650,000 doctors, beginning January 18th. Just as distressing is the alert Medicare sent out to its physicians this week, informing them that claims would be on hold for the first 10 days of 2012 – which could quite possibly cause Medicare’s computer systems to crash. It nearly happened last year when claims were held for more than 20 days.

“We feel that (Medicare) came very close operationally to crashing our system back in 2010,” Medicare deputy administrator Jonathan Blum told the AP. “From a stewardship perspective, that is something we feel we can never repeat again.” The number of claims is expected to rise during the winter. (Read more of the AP story in the Washington Post.)

Threats of reimbursement cuts are not new. With no permanent solution, Congress typically puts a Band-Aid on the issue, enacting temporary stays until the next time around.

With the Senate already adjourned until January 23rd, Sen. Harry Reid (D-Nev.) had made it clear that a conference will not take place in time to spare the reimbursement cuts. The only hope, it seems, is for the House to pass the temporary measure. (A detailed breakdown over the fight can be found here.)

"Congress has again failed to fulfill its responsibilities," American Medical Association President Peter Carmel, MD, said in a statement. "It is shameful that patients and physicians are the collateral damage; the citizens of this country deserve better."

Stay tuned…