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Delay In Physician Pay Reduction

February 17, 2011 | No Comments
Posted by Frank Ciesla

The 2012 Federal budget proposed by the Obama Administration delays the threatened 28% cut in Medicare payments to doctors for two (2) more years, until after the elections.  This approach continues kicking the can down the road, and does not permanently resolve the situation.  At a hearing on Tuesday, February 15, 2011, both Senate Finance Committee Chair Max Baucus, a Democrat, as well as Orrin G. Hatch, the Republican ranking member, challenged Health and Human Services Secretary Kathleen Sebelius to come up with a permanent overhaul of the Medicare physician pay formula.  The lack of a permanent solution continues to put at risk doctor compensation for providing services to Medicare beneficiaries.  It also does not address the need to reduce Medicare expenditures so as not to continue growing the national deficit.  As Senator Alan Simpson co-chair of the Debt Reduction Commission, stated on cable news, it is necessary to reduce physician compensation if we intend to have a handle on the Medicare expenditures going forward.  Regrettably, the math is simple.  If there are more beneficiaries, as there will be with the baby boomers, and society does not want to or cannot afford to increase the Medicare expenditures, the alternatives are to reduce payment to providers or ration care.

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