Congress narrowly forestalled a 21.3 percent cut in Medicare payments to physicians this month. The cut was due to the Sustainable Growth Rate (SGR) physician payment formula, which IDSA and other medical societies have protested for years. The Senate passed legislation on June 18 that will retroactively replace the payment cut with a 2.2 percent increase for six months, from June 1 through November 30, 2010, and the House followed suit on June 24.

Medicare began processing claims at the reduced rate on June 18 after holding them for nearly three weeks to give Congress more time to enact a fix. Claims will automatically be reprocessed at the higher rate now that Congress has acted.

Cuts of this magnitude are the result of past congressional fixes that have provided temporary payment relief to physicians but have not changed the flawed SGR. Even before this latest action, Congress had intervened nine times since 2002 and three times during the first half of this year to avert payment cuts, but because lawmakers still haven’t addressed the SGR, those votes have merely prolonged the underlying problem. Even bigger cuts will be in store next year, unless the SGR is reformed.

For additional information regarding future payment cuts or to contact your member of Congress, please visit IDSA’s Physician Payment Toolkit.

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