Senate Finance Chairman Ron Wyden said the rising cost of replacing Medicare’s physician payment formula adds urgency to the effort to pass compromise legislation during the lame duck instead of waiting until the March 31 deadline to prevent scheduled cuts to doctors.
The Congressional Budget Office estimated late Friday that a bipartisan, bicameral “doc fix” plan introduced in February (HR 4015, S 2000) to replace the sustainable growth rate formula, or SGR, would cost $144 billion over a decade. That’s up from the roughly $138 billion, 11-year price tag that CBO released in February.
While the new estimate spans fiscal years 2015 to 2024, a Democratic aide said that CBO would add another year to that window in February, drawing it out to fiscal 2025. Based on the projected cost for 2024 and the increases in prior years, the expanded timeframe could add around $21 billion to the cost of the legislation. “I’m going to continue to point out that what we’re seeing is the score is continuing to go up,” Wyden, D-Ore., said in an interview. “If you put it off into well into next year, CBO says it adds another year to the budget window.”
One reason for the higher price tag since the February estimate is that a policy in the compromise bill was incorporated into legislation signed into law in April (PL 113-93) that temporarily forestalled cuts to Medicare doctors, according to the aide. If the patch expires without further congressional action, doctors will see about a 21 percent cut in their fees April 1.
In its updated score, CBO also estimated that an alternative step that would freeze current payment rates for the next 10 years would cost $118.9 billion, slightly less than a $124 billion projection the agency made in April. Passing another temporary patch freezing current rates through the end of 2015 would cost $13.6 billion over a decade while a longer patch through 2016 would cost $32 billion, the CBO estimated.
Lawmakers and advocates have been urging congressional leaders to include the replacement legislation on the lame duck agenda, though a lack of consensus over how to handle its cost remains a significant obstacle.
Wyden said lawmakers from both parties and chambers have approached him unsolicited to ask why Congress can’t act now. The issue is getting the attention of members focused on health issues and “a surprising number who are hearing from seniors and providers at home saying, ‘get this done,’” he said. “Why not try to permanently pay for value rather than just putting it off and facing additional expenses and yet one more round of this classic, well, should we cut providers, should we cut seniors, pitting people against each other?” Wyden said. “The real change that I’ve wanted to see now for many months is a system that really focuses on value.”