Hope for Medicare Pay Fix Returns in Lame Duck

Congress has plenty to do before the end of the year, but there’s one thing that’s not on their usual list: They have until April to fix a Medicare formula, known as the sustainable growth rate or SGR, that will have doctors facing a 21 percent pay cut in the federal program without action from Congress.

But talk of a permanent fix is still percolating among key members of Congress during the lame duck session.  Almost no member of Congress opposes getting rid of the Medicare SGR. The challenge in recent years has been finding money in other programs, typically Medicare, to pay for the “doc fix.” The Congressional Budget Office earlier this month said a bipartisan plan to replace the formula would $144 billion over ten years.

Passing a permanent fix before the end of the year could give Republicans political cover with Democrats still in control of the Senate. Republicans have generally opposed passing doc fix legislation without corresponding cuts in other programs. Last year, House Republicans shot down a permanent doc fix plan that had momentum in the Senate because it covered the cost with a “war savings” account that is often decried as a gimmick by budget hawks. This time around it might not be easier – but it will almost certainly be harder to use such a tactic with Republicans in control of both chambers.

Sen. Orrin Hatch (R-UT), the current Senate Finance ranking member and expected chairman in the next Congress, did not outright reject the idea of passing a Medicare patch without offsets when asked if he would support a temporary or permanent doc fix without offsets. He said he wants to wait and see what the options are.

“I’m not sure. I’ll have to look at it, there’s a lot of time to look at it. I’d like to fix it one way or the other and I’d like to fix it permanently,” Hatch said. “I just know that everyone would like to solve it and solve it permanently and leading that pack is myself. I’d like to solve it permanently.”

Sen. Ron Wyden (D-OR), current chairman of the Senate Finance Committee, said he’s had members from both parties and chambers say they want to take action on the doc fix now.

“The price tag is going to go up…I think we ought to be saying now we are going to move to a standard based on value,” Wyden said. “I want a repeal and replace.”

Lawmakers have passed temporary doc fixes 17 times, varying from as short as 30 days to as long as 2 years, said Julius Hobson, a lobbyist for Polsienelli Shughart who represents health clients.

“We’ve gone through smoke and mirrors in the last few temporary fixes and everyone knows Congress isn’t going to let a 21.2 percent cut to Medicare happen,” Hobson said.

Morning Consult