Government Affairs Home > Washington Highlights > February 15, 2002

Ways and Means Leadership Asks Administration to Prioritize Medicare Payment Adjustments

February 15, 2002 - In a Feb. 8 letter to HHS Secretary Tommy Thompson and OMB Director Mitchell Daniels, House Ways and Means Committee Chairman William Thomas (R-Calif.) and Health Subcommittee Chairman Nancy Johnson (R-Conn.) asked how the Bush Administration will reconcile its commitment to budget neutrality with MedPAC's recent recommendations regarding Medicare provider payment adjustments. MedPAC has recommended spending about $174 billion over 10 years on payment updates/payment formula revisions for physicians, hospitals, rural providers, nursing homes, home health agencies, and dialysis facilities. According to the letter, MedPAC's recommendation to reform the sustainable growth rate (SGR) methodology for physician payments alone will cost about $128 billion.

In the letter, Representatives Thomas and Johnson direct Secretary Thompson and Mr. Daniels to "identify which provider problems you believe merit congressional action and which do not," given the President's call for budget neutrality. They also ask the Administration to "provide a specific list of Medicare savings recommendations" that would finance "appropriate provider payment changes." While Representatives Thomas and Johnson call the President's Medicare modernization and drug coverage proposals "insufficient" ($190 billion over 10 years), they assert that "none of this money is intended for provider payment increases."

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