From the August 25 edition of Fox News' Hannity:
SEAN HANNITY (host): It used to be health care reform. Now it's health insurance reform. They keep saying choice and competition. So you can see that they're applying this -- as this has failed, they're using the new terminology, right?
LUNTZ: Oh, it's fascinating to watch. But you notice he said cost control. What he should have said was ending waste, fraud, abuse, and mismanagement.
Now, here's the problem when you get to the details. Medicare is a great example. Barack Obama never said that he's going to cut Medicare benefits for seniors. But what he did say is that he's going to cut Medicare reimbursement. And this is something I challenged the organization Media Matters, because they simply got it wrong. It's like they've got high school interns doing their research.
There's a difference between Medicare benefits and reimbursement. But I say to everyone over age 65, do you understand what cutting Medicare reimbursement means?
LUNTZ: Less doctors will want to take Medicare recipients; less hospitals will welcome them. It's going to mean denial of coverage. That's exactly what a reimbursement does. If you don't give doctors the money, they won't do the procedures.
Luntz: "cutting Medicare reimbursement" means not "giv[ing] doctors the money"
Luntz suggested proposed Medicare reimbursement cuts would reduce doctor payments. During the August 25 edition of Hannity, Luntz asserted: "[D]o you understand what cutting Medicare reimbursement means? Less doctors will want to take Medicare recipients; less hospitals will welcome them. It's going to mean denial of coverage. That's exactly what a reimbursement does. If you don't give doctors the money, they won't do the procedures."
House bill cancels scheduled 21 percent physician payment cut
House tri-committee bill replaces scheduled reduction in physician payment with "inflation-based update." The House bill changes the formula for reimbursing physicians, which is currently based on the sustainable growth rate formula and, absent congressional action, would require a 21 percent cut in January 2010. According to the Congressional Budget Office's July 17 score of the House bill as introduced, "the net cost of the changes in physicians' payment rates would total $245 billion." From the CBO:
The provisions that would result in the largest savings include:
- Permanent reductions in the annual updates to Medicare's payment rates for most services in the fee-for-service sector (other than physicians' services), yielding budgetary savings of $196 billion over 10 years (excluding interactions-namely, the effects of those changes on payments to Medicare Advantage plans and collections of Part B premiums);
The provision that would result in the largest increase in Medicare spending would change payment rates for physicians' services to replace the 21 percent reduction in payment rates scheduled for January 2010, under the existing "sustainable growth rate" formula, with an inflation-based update. In subsequent years, rates would reflect separate updates for "evaluation and management" services and for all other services. CBO estimates that those changes would cost $228 billion over the 2010- 2019 period (before taking into account interactions). Including those interactions, the net cost of the changes in physicians' payment rates would total $245 billion. [CBO, 7/17/09]
FactCheck.org: House bill provides "increase in spending for doctors." From FactCheck.org:
The nonpartisan Congressional Budget Office has estimated that the House bill would result in "savings" of $219 billion after all increases and decreases are netted out. [...] But it also proposes what CBO estimates is a $245 billion increase in spending for doctors, by canceling a scheduled 21 percent cut in physician payments. None of the "savings" or "cuts" (whichever you prefer) come from reducing current or future benefit levels for seniors. [FactCheck.org, 8/18/09]
House bill's Medicare provisions include other benefits for doctors. According to a summary of the bill's key Medicare provisions by the Kaiser Family Foundation, the bill also provides a 5 percent payment bonus for primary care services and for certain services provided to areas receiving less care. The bill also increases the payment rate for psychiatric services and extends payments to physicians for quality reporting of data on the care they provide.
Doctors' groups praise House bill's reimbursement change
AMA endorsed House bill's change to the SGR formula. In a July 16 letter to Ways and Means Chairman Charles Rangel endorsing the legislation his committee had helped promulgate, the American Medical Association specifically praised the bill's changes to physician reimbursement. From the letter:
In particular, we are pleased that the bill:
- Recognizes that fundamental Medicare reforms, including repeal of the sustainable growth rate formula, are essential to the success of broader health system reforms[.]
AAFP endorsed House bill's doctor payment reform. According to the American Academy of Family Physicians' website, AAFP, which represents "more than 94,600 family physicians," has "endorsed the bill's elimination of accumulated Medicare payment cuts called for by the sustainable growth rate, or SGR, formula -- a move that would pave the way for a permanent SGR fix. The bill would provide a new framework for future payment updates that would allow spending on physician services to increase at a rate higher than the gross domestic product and create a higher spending baseline target for evaluation and management and preventive services." [AAFP.org, 7/22/09]