Medicare Cuts: Update!

[Winged Scapula]

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A few emails I received today (from ACS, SSO, ASBS, etc.)

June 27, 2008

SENATE FAILS TO PASS KEY MEDICARE LEGISLATION

Dear Colleague,

Last night, the Senate fell one vote short of passing the Medicare Improvements for Patients and Providers Act of 2008. This legislation would have stopped the 10.6% cut in Medicare reimbursement that will now go into effect on July 1st. In addition, the legislation would have stopped the 5.4% cut scheduled for January 1st and provided a positive 1.1% update for 2009. We will now need to continue our advocacy efforts into July so Congress can pass legislation to retroactively stop the 10.6% cut when they return to Washington, DC on July 7th.

We need your immediate help! Please send an e-mail to your state’s U.S. Senators at http://capwiz.com/ama/home/ or contact the AMA’s hotline at 1-800-833-6354 to be directly connected to your Senators’ Offices. We have listed the roll call for the Medicare vote below for your reference. Please ask your Senators why they voted against the Medicare Improvements for Patients and Providers Act of 2008 thereby cutting our reimbursement by 10%, or thank them for supporting this important legislation and their continued support in the coming days.

Thank you for taking the time to call or email your representatives. Our activism has positively affected legislation in the past and will again!

 

[njbmd]

A few emails I received today (from ACS, SSO, ASBS, etc.)

June 27, 2008

SENATE FAILS TO PASS KEY MEDICARE LEGISLATION

Dear Colleague,

Last night, the Senate fell one vote short of passing the Medicare Improvements for Patients and Providers Act of 2008. This legislation would have stopped the 10.6% cut in Medicare reimbursement that will now go into effect on July 1st. In addition, the legislation would have stopped the 5.4% cut scheduled for January 1st and provided a positive 1.1% update for 2009. We will now need to continue our advocacy efforts into July so Congress can pass legislation to retroactively stop the 10.6% cut when they return to Washington, DC on July 7th.

We need your immediate help! Please send an e-mail to your state’s U.S. Senators at http://capwiz.com/ama/home/ or contact the AMA’s hotline at 1-800-833-6354 to be directly connected to your Senators’ Offices. We have listed the roll call for the Medicare vote below for your reference. Please ask your Senators why they voted against the Medicare Improvements for Patients and Providers Act of 2008 thereby cutting our reimbursement by 10%, or thank them for supporting this important legislation and their continued support in the coming days.

Thank you for taking the time to call or email your representatives. Our activism has positively affected legislation in the past and will again!

I received a few of these too. All of the years of training and we have to look at this type of stuff every year. It's disheartening when you are trying to get a practice off the ground and your salary keeps getting cut.

 

[Winged Scapula]

Its why all my contracts are based on 2006 Medicare Rates, but for the few Medicare patients I see, it is disheartening.

 

[StevenRF]

For anyone in the know, for how many years are major cuts like this expected to continue? Did the 10.6% cut affect every reimbursement rate for every specialty or just surgeons?

Cost of attendance is going up about 5-10% a year for med school. Reimbursements are going down by 10-15%.

For you guys already practicing, any insight on the direct and future affects on your bottom lines? As an MS3 thinking of surgery with at least 7 more years to go before practicing, this is disheartening. Genuine interest in a field vs income, but at some point it just ain't worth it. I'd be curious to know how much farther salaries would have to fall for you guys to move on to other options.

EDIT: http://www.ama-assn.org/ama/pub/category/6583.html According to the AMA, salary cuts of 40% by 2016. Locumtenens says average general surgery salary is 250k, so what, it will be 150k then? WTF is the point of an extra 9 years of education then? Oh yea, inflation is running at >4% now and on the rise, so 10 years out cut the effective salary by half again.

 

[Dr.Millisevert]

For anyone in the know, for how many years are major cuts like this expected to continue? Did the 10.6% cut affect every reimbursement rate for every specialty or just surgeons?

Cost of attendance is going up about 5-10% a year for med school. Reimbursements are going down by 10-15%.

For you guys already practicing, any insight on the direct and future affects on your bottom lines? As an MS3 thinking of surgery with at least 7 more years to go before practicing, this is disheartening. Genuine interest in a field vs income, but at some point it just ain't worth it. I'd be curious to know how much farther salaries would have to fall for you guys to move on to other options.

EDIT: http://www.ama-assn.org/ama/pub/category/6583.html According to the AMA, salary cuts of 40% by 2016. Locumtenens says average general surgery salary is 250k, so what, it will be 150k then? WTF is the point of an extra 9 years of education then? Oh yea, inflation is running at >4% now and on the rise, so 10 years out cut the effective salary by half again.

In Australia and New Zealand within the past 5 years... up to 30% of our FMGs are UK trained doctors and we also have an ever increasing % of FMGs coming here from the US to do residency and to work. No wonder with what's going on. 😱

 

[jubb]

Are these cuts broad spectrum? Or are they cutting specific reimbursements?

There are a few specialties that I wouldn't cry too much about if they got a few cuts and actually had to work a little harder. I'm not a fan of the work a little get paid a lot specialties. Not that I want them to get punished, but I want the work horses that keep health care running to get rewarded. I'm not trying to pick on ER people, but I feel like it gets sold on the basis of 30 hours a week, get paid 250-300k a year and it's only a 3 year residency. I also don't really want more more people trying to tell me I'm stupid for going into an intense specialty and passing on anesthesia, radiology, or ER for the lifestyle/reimbursement aspects.

 

[chrisisinnocent]

Are these cuts broad spectrum? Or are they cutting specific reimbursements?

There are a few specialties that I wouldn't cry too much about if they got a few cuts and actually had to work a little harder. I'm not a fan of the work a little get paid a lot specialties. Not that I want them to get punished, but I want the work horses that keep health care running to get rewarded. I'm not trying to pick on ER people, but I feel like it gets sold on the basis of 30 hours a week, get paid 250-300k a year and it's only a 3 year residency. I also don't really want more more people trying to tell me I'm stupid for going into an intense specialty and passing on anesthesia, radiology, or ER for the lifestyle/reimbursement aspects.

It's an across the board cut. Nobody is spared. This kind of ******ed "as long as it's not me or not the specialty I'm interested in I don't care" attitude is what has allowed the government and insurance companies to slowly pay doctors less and less. When you look at the numbers doctor compensation is a small part of the health care pie but one that constantly gets attacked because we suck as a lobby group and trying to get doctors united behind a cause is like herding cats.

 

[Strength&Speed]

It's an across the board cut. Nobody is spared. This kind of ******ed "as long as it's not me or not the specialty I'm interested in I don't care" attitude is what has allowed the government and insurance companies to slowly pay doctors less and less. When you look at the numbers doctor compensation is a small part of the health care pie but one that constantly gets attacked because we suck as a lobby group and trying to get doctors united behind a cause is like herding cats.

qft

 

[jubb]

I'm not advocating cutting anybodies pay nor would I support any measure that did so. I'm just saying that rather than cutting every bodies paycheck because some doctors are overpaid, bring the overpaid people to a more reasonable rate of pay. I do agree that we need to play the game and lobby or we'll keep getting screwed.

 

[thedrjojo]

and this is why we need a universal health system that has doctor input (or doctor control as the bad AMA plan wants) in setting rates... It makes me more and more want to go into a cash based practice, but i want to go into academics anyway so I'm expecting lower pay anyway 😛

 

[MacGyver]

One more thing to think about. All these articles say "payments to doctors" but thats really a misnomer.

What it should say is "payments to providers" because this pool of money goes out to everybody who bills Medicare, not just doctors. That includes NPs, PAs, psychologists, naturopaths, chiropractors, acupuncturists, pharmacists, etc.

Everybody and their brother wants in on the Medicare payments. Pharmacists are lobbying for more payment as are the other people on my list.

Remember, the pool of money is fixed for everybody--so when you pay pharmacists it means doctors get paid less money.

 

[ACSurgeon]

About this cut, will this directly translate into 10% reduction in salaries unless doctors work 10% more? I ask this because I would guess that hospitals are NOT just breaking even... that is, if they charge 10K per surgery and give the surgeon a fixed salary, just because they are now charging 9K doesn't mean that the hospital is no longer making a big enough profit to give the surgeon the same salary. I know, the hospital administration is looking out for itself and not its doctors, but is my logic at least somewhat in place? Could a 10% cut in medicare reimbursements translate into a lesser pay cut for physicians (like say just a 1-2% or something)?

 

[Winged Scapula]

Most physicians in the community are not on salary, so the issue you raise is not relevant. The 10% cut will be on all Medicare billing and since insurance companies base their rates on Medicare, the reimbursement from them can also be expected to go down 10%.

For those physicians who are employed by medical centers (usually academic type places) since they have a contract for X amount of salary dollars, it should not affect their current salary. When contract negotiations come up, they may find some employers attempting to change the salary. It would depend of course on the amount of Medicare patients the hospital sees and whether or not the insurance companies that they take also reduce reimbursement.

 

[Winged Scapula]

Today the Bush Administration froze the Medicare Cuts scheduled for July 1, 2008 temporarily until Congress returns to session after the July 4th recess. The Senate opposed HR 6331 on June 27 which would increase the fees by .5 % for 2008 and 1.1% in 2009. Senator Jon Kyl opposed and Senator John McCain was campaigning and not in attendance. And to make matters even worse, CMS is holding physician payments for 14 days from July 1 - July 15,2008.

 

[JaggerPlate]

I'm just saying that rather than cutting every bodies paycheck because some doctors are overpaid, bring the overpaid people to a more reasonable rate of pay.

Isn't that called socialism??

 

[Lamborghini1315]

Are these cuts broad spectrum? Or are they cutting specific reimbursements?

There are a few specialties that I wouldn't cry too much about if they got a few cuts and actually had to work a little harder. I'm not a fan of the work a little get paid a lot specialties. Not that I want them to get punished, but I want the work horses that keep health care running to get rewarded. I'm not trying to pick on ER people, but I feel like it gets sold on the basis of 30 hours a week, get paid 250-300k a year and it's only a 3 year residency. I also don't really want more more people trying to tell me I'm stupid for going into an intense specialty and passing on anesthesia, radiology, or ER for the lifestyle/reimbursement aspects.

I agree gen surgeons are one of the hardest working groups in medicine and they seem to take a hit all the time. You have a valid point..there should be a wage scale correlating to the complexity of the field and hours spent . It would be unsettling to see someone who chose an easier route than you enjoying better benefits.

 

[thedrjojo]

Isn't that called socialism??

I think a blanket 10% decrease is more socialistic than decreasing overpaid specialties more than lowerpaid specialties...

 

[JaggerPlate]

I think a blanket 10% decrease is more socialistic than decreasing overpaid specialties more than lowerpaid specialties...

I agree that the 10% decrease is pathetic. However, I don't think that cutting from one sect of high paying medicine to pad another is very democratic. I am 1000000% for much, much better pay for primary care physicians, for example, but I don't think it's fair to take the pay from other doctors. All that will do is create a new mess of scrambling, complaining and bickering within the same community that should be rallying for better benefits all around.

 

[MOHS_01]

A 10% decrease in reimbursement translates into greater than a 10% decrease in take home pay. The vast majority of costs associated with running a medical practice are fixed in nature; any decrease in revenue translates into a dollar for dollar loss in profit.

For ease of math, consider the following scenario:

practice gross: $1,000,000
operating expenses: 500k (50%)
physician income: $500k

next year 10% cut in revenue for like work due to MC cuts. Inflationary pressures on operating expenses approx 4%

practice revenue: 900K
operating expenses: 520k (500k + inflationary 4%)
practice profit $380k

As you can see, a 10% cut in reimbursement translates into much greater than a 10% cut in pay.

 

[Faebinder]

Every institution needs to assess if it still wants to take medicare... and for what specialties. Likewise reassessment of private insurance cause you know they will redo their reimburisement rates after the cuts in medicare.

 

[njbmd]

Today the Bush Administration froze the Medicare Cuts scheduled for July 1, 2008 temporarily until Congress returns to session after the July 4th recess. The Senate opposed HR 6331 on June 27 which would increase the fees by .5 % for 2008 and 1.1% in 2009. Senator Jon Kyl opposed and Senator John McCain was campaigning and not in attendance. And to make matters even worse, CMS is holding physician payments for 14 days from July 1 - July 15,2008.

Sen Harry Reid is going to reintroduce HR 6331 after recess. It's a good time to call your senators and ask them to support this bill. This is the notice that I received:


Senate Majority Leader Harry Reid of Nevada has committed to bringing the measure up again when they return from the Fourth of July recess. Until then, you may call or visit your U.S. Senator at home, where they are in the middle of a district work period. Fixing the problem retroactively will be most inconvenient for all concerned, but the alternative is even more onerous.

Here's how you can help us TODAY:

1. Please call or visit your U.S. Senator* and urge them to vote yes on H.R. 6331 as soon as they return from the recess.

2. Please tell all your friends to call their U.S. Senators as well.

*If you live in a state represented by any of the following Senators, then your call is especially important: Cochran (MS), Wicker (MS), Corker (TN), Alexander (TN), Isakson (GA), Chambliss (GA), Sessions (AL), Shelby (AL), Domenici (NM), Warner (VA), Dole (NC), Burr (NC), Sununu (NH), and Voinovich (OH).

Believe me, my senators have heard from me as have a few others. This might not affect me much personally but for those who are coming behind me, it will affect them.

 

[MOHS_01]

Every institution needs to assess if it still wants to take medicare... and for what specialties. Likewise reassessment of private insurance cause you know they will redo their reimburisement rates after the cuts in medicare.

Easier said than done, my friend. Negotiating better rates with private insurance companies can be quite difficult in different markets due to the oligopolistic nature of the industry. Cutting out MC may mean telling patients (who become somewhat friends after time) that you are turning them away -- and the % of the population covered by MC is increasing rapidly.

In theory your solution is quite simple. In practice it is less palatable and frankly unlikely in many instances.

 

[NPR]

Easier said than done, my friend. Negotiating better rates with private insurance companies can be quite difficult in different markets due to the oligopolistic nature of the industry. Cutting out MC may mean telling patients (who become somewhat friends after time) that you are turning them away -- and the % of the population covered by MC is increasing rapidly.

In theory your solution is quite simple. In practice it is less palatable and frankly unlikely in many instances.

I'm not sure this is a situation that will remain the same forever.

I've been told repeatedly in fields like dermatology that physicians in the private sector don't even accept Medicare patients anymore.

And as MOHS noted, that is a rapidly increasing percentage of patients.

At some point, things will have to change. Academic centers cannot be expected to take on the burden of seeing all these patients.

 

[MOHS_01]

I'm not sure this is a situation that will remain the same forever.

I've been told repeatedly in fields like dermatology that physicians in the private sector don't even accept Medicare patients anymore.
And as MOHS noted, that is a rapidly increasing percentage of patients.

At some point, things will have to change. Academic centers cannot be expected to take on the burden of seeing all these patients.

With the exception of those who have successfully transitioned into an all cash or cosmetic practice (and these numbers are very, very small), this is propaganda in large part to justify the physician shortage arguments. Dermatology has transitioned (due to demographic forces) into more of a minor procedural field as skin cancer incidence has increased. One is better off financially seeing the MC skin cancer patient than the forty and fifty year old women with a list (literally, they bring in a list) of complaints for paltry E&M charges. Being as the derm bunch, as a whole, are not a dumb group of people... while we may decry MC reimbursement, we have not dropped it.

It would be like cutting off your nose to spite your face.

 

[DOCTORSAIB]

Update: H.R. 6331 passed the Senate!

http://www.govtrack.us/congress/bill.xpd?bill=h110-6331

 

[TehDoc]

I bet you're happy.