Health Subcommittee Chairman
Introduces New Medicare Physician Payment Legislation
March 15, 2002 - Fearing that inadequate physician
payments will drive providers out of the Medicare system,
discourage students from entering medicine, and "erode
the world famous quality of American medicine," Ways
and Means Health Subcommittee Chairman Nancy Johnson (R-Conn.)
March 6 introduced a bill that would reform the system used
to calculate the Medicare physician payment update.
The "Preserving Patient Access to Physicians Act of
2002" (H.R.
3882) would repeal the current sustainable growth rate
(SGR) methodology and replace it with a formula that bases
the update on estimated changes in input prices for the coming
year, less an adjustment for growth in multifactor productivity.
According to Chairman Johnson, the new formula would be similar
to those used to update payments to other providers.
Physician payments would reflect the new formula as of CY
2004. Johnson's bill provides short-term relief in 2003 by
setting the payment update at 2.5 percent.
In addition, H.R. 3882 directs the Medicare Payment Advisory
Commission (MedPAC) to evaluate (by specialty) the impact
of refinements to the practice expense component of physician
payments. Examples include the effect of practice expense
refinements on physician payments, access to care, and physician
participation.
The Medicare physician payment conversion factor was reduced
by 5.4 percent on Jan. 1. Last fall, the Senate and House
introduced bills (S.
1707/H.R.
3351) that would reduce the 2002 cut from minus 5.4 percent
to minus 0.9 percent and require MedPAC to develop a replacement
for the SGR. Both bills have significant support (73 cosponsors
in the Senate and 331 in the House).
Information:
Christiane Mitchell, Senior Legislative Affairs Manager
AAMC Government Relations
cmitchell@aamc.org
(202) 828-0526
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