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July 2008
Volume 18, Number 7
Congress Stops Steep Medicare Physician Payment Cuts, For Now

Congress enacted legislation this month that stops steep Medicare physician payment cuts from taking effect this year. The Medicare Improvements for Patients and Providers Act of 2008 (H.R. 6331) retroactively maintains physicians' payments at their pre-July 1 levels during the second half of 2008 and increases payments by 1.1 percent in 2009.

Although President Bush vetoed the Medicare bill (for reasons unrelated to physician payment), Congress successfully overrode the veto July 15. Had that not happened, ID practices would have seen their payments cut by nearly 11 percent.

The Centers for Medicare and Medicaid Services has instructed its contractors to implement the revised payment rates. However, since it may take up to 10 business days for contractors to implement these changes, some claims may still be paid at the lower rates that were in effect between July 1 and July 15. Claims paid at the lower rates will automatically be reprocessed.

IDSA has developed several web-based payment resources, including an interactive reimbursement calculator to help you estimate what the payment changes mean for your practice. (You will need your member log-in.)

Future Physician Payment Cuts

Congress’s action means that steep cuts have been forestalled but not prevented. Physicians face several years of future payment cuts beginning with a projected 21 percent payment cut in 2010. These cuts are due to the flawed formula, called the sustainable growth rate (SGR), used by Medicare to calculate physician payments. Please visit IDSA's Physician Payment Toolkit for information on future payment cuts and to contact Congress to support a long-term and sustainable solution to the physician-payment problem.
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