Right now Congress is debating primarily on how to pay doctors more to treat Medicare patients than allowed under the Sustainable Growth Rate (SGR) formula in what is known as the doc patch. This is a recurring “fix” as the SGR would cut provider pay for Medicare patients by 20% to 25% immediately. Doctors are among the most trusted professions out there, so when they scream as a collective body, the American public will listen. And when the comparison is against Congress, the American public will believe the doctors without analyzing the argument too hard.
Congress has passed a doc fix every time that doctors could have potentially faced pay cuts. Currently there is talk about passing a permanent doc fix. The question is finding the pay-for. I would be more than willing to take a public option or the Veterans Administration offering their formulary for Medicare Part D in exchange for giving doctors more money. Republicans don’t want those policy trades that would be net deficit reducing.
There is a strong potential for a second doc fix style situation to come up this November and December. PPACA for 2013 and 2014 changed the rate that Medicaid pays primary care providers (PCP) for primary care services. Instead of getting the baseline Medicaid rate, providers that are either board certified PCPs or perform mostly PCP billing codes, these providers would get the Medicare rate.
The change to a Medicare baseline is important. Right now for physical health fee for service, Medicaid tends to pay significantly less than Medicare which pays a bit less than narrow network Exchange which tends to pay significantly less than broad network Exchange/Group Commercial which tends to pay less than non-par out of network. Bumping Medicaid pay to Medicare rates reduces the incentive for doctors to treat current patients who are on Medicaid but to not take any new Medicaid patients while holding those slots open for commercial or Medicare insured individuals.
The goal of the program was to act as a two year bridge to expand the PCP universe who would accept new Medicaid expansion patients. From my point of view, it has been successful in opening up panels. The problem is that it was a temporary two year path. Current law assumes on January 1, 2015, Medicaid PCP service fees will be reduced by 25% to 50%.
I don’t think that will happen quietly. Doctors are an amazingly well organized lobby with high degree of political trust. The Democrats want primary care providers happy to take Medicaid patients and Republicans count on doctors as a major donor class, so I think something will be done if it can be done in such a way that Republicans can facially claim that they are not funding Obamacare.