Memorial Day Washington Report on Sustainable Growth Rate Fix for Doctors

The Physicians Foundation regularly features “The Washington Report.” Lee Stillwell, Founder of the Stillwell Group, a public affairs consulting group in the nation’s capitol, writes the report.

Stillwell has worked for a Western Republican, an Eastern Democrat, and the AMA Advocacy Group. In his report, he gives Physician Foundation members a candid look inside Beltway politics.

In his Memorial Day report, Stillwell focuses on the continuing saga of the Sustainable Growth Rate (SGR) formula. Congress uses this formula as the basis for paying physicians for Medicare services.

For the last ten years, Congress has been unwilling and unable to fix the SGR to pay doctors at rates which they can sustain their practices in order to continue to see existing and new Medicare patients. Congress, in short, seems incapable of delivering on its promises to provide physician access to Medicare patients or even to deliver on its pay-go promises.

The reasons for Congressional fiddling, dithering, and stalling are political and economic.

According to Stillwell,

“First, take a look at the fiscal impact at the years of delay in fixing the SGR. The Congressional Business Office (CBO) estimate indicates the price tag for a “doc fix” now is $275 billion through 2010, assuming it is a freeze. That is a 33 percent increases from last year’s legislative projections of $207 billion. Now, if you were to include cost-based raises fo this period in the 0.7 percent to 1.8 percent, the costs climb to $329.9 billion. . If you gave physicians a modest two percent raise, the costs climb to $374.2 billion!”

Congress, if you’ll recall, promised Obamacare would cost under $1 trillion over the next 10 years – a number the OMB just shattered by estimating it would cost an extra $115 billion to implement. Add over $300 billion to that, and you blast the $1 trillion figure to smithereens.

Stillwell observes,

“The estimates, quite frankly, drive the nail in the coffin, killing efforts for a long-term fix. A Congress and Administration that has spent and spent now refuses to offset these mounting costs under the pay-go promises.”

Stillwell goes on,

“Whether another 30-day extension, or a longer temporary fix, will be adopted when Congress returns from next week’s Memorial weekend recess, SGR fatigue will grow among physicians, tired and weary with this political consequences.”

What would the political consequences if Congress fails to rescind the 21.3% SGR cut scheduled for June 1? It won’t happen, of course, Congress will kick the fix further down the road.

But if it did not executive a temporary fix, Stillwell says,

“An informal AMA survey found that 68 percent of physicians would either stop taking new Medicare patients or stop seeing Medicare patients altogether if the 21.3 percent were to take effect.”

An American Osteopathic survey indicated 37 percent would not accept new Medicare patients, 32 percent said they might, and 30 percent said they would.

With 78 million baby boomers coming on board the Medicare train in 2011 at the rate of 13,000 each day, doctors not accepting new Medicare patients would put Congress in a pretty political pickle, with a good chance of incumbent members drowning in the electoral pickle barrel. A physician access crisis will be upon us, and it will dwarf the growing current discontent over Obamacare. The latest Rasmussen poll indicates 64 percent disapprove of the health care bill, versus 32 percent who approve. This is the first time disapproval has exceeded 60 percent.

The information contained in this blog does not necessarily reflect the views or position of the Physicians Foundation or its Board members or of Lee Stillwell in the Washington Report or of the Stillwell group.