Wednesday, January 19, 2011

What is this "doc fix"?

The Doc Fix Dilemma - Hit & Run : Reason Magazine
Here’s the problem: In 1997, Congress decided it was high time to get Medicare spending under control. Their solution was to tie physician reimbursement rates to an inflation-based formula called the sustainable growth rate. The formula worked fine as long as it called for increased payments. But that didn’t last long. In 2002, the formula, Congress allowed payments to drop 5 percent. The reaction from physicians was strong enough that they didn’t let it happen again. Since 2003, Congress has voted repeatedly to temporarily extend or increase existing reimbursement rates through deficit spending. The temporary patches have substituted for permanent fixes because no one knows how to pay for a long-term fix. But by relying on a series of temporary patches, Congress has made it even more expensive to enact a long-term fix.

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