Harry Reid Not On Board Yet With Medicare Changes

House Speaker John Boehner has been quietly pushing a bill to change the formula used to pay physicians under Medicare. The bill ends the sustainable growth rate (SGR) formula which has forced Congress to pass ad hoc bills each year to avoid physicians having their payments automatically cut due to SGR.

The SGR formula was passed as part of the Balanced Budget Act of 1997 and was designed to control Medicare costs by cutting payments to physicians if their costs exceed a set amount of expenditures. In theory this would incentivize physicians to pursue quality over quantity as physicians would be wary of pursuing a volume based business model for fear they would have their payments cut.

Unfortunately, the arbitrary and unworkable nature of the formula has forced Congress to periodically pass short term legislative bills to stop the automatic payment cuts that would potentially ruin physician practices reliant on Medicare and thus deny Medicare users access to services.

Speaker Boehner found an ally in House Minority Leader Nancy Pelosi who has signed on to repealing SGR giving the bill bipartisan support in the House.

In the Senate the bill has not been well received by Democrats, with Senate Minority Leader Harry Reid saying “I personally am going to wait until we see it having passed the House before we start speculating what we need to do with it, if anything," later adding "There's a lot to be done."

One of the major concerns raised so far has been what effect the bill will have on reproductive rights for women with Planned Parenthood raising concerns about an "extension" of Hyde Amendment rules to community health centers as part of the bill. Pelosi has countered that any such restrictions will expire when the funding for the health centers does under the bill, though Planned Parenthood seems just as concerned about the precedent.

The bill to repeal the SGR formula, if passed, would go down as one of Speaker Boehner's signature achievements on entitlement reform. Something not lost on his opponents nor opponents of current plans to start dismembering social insurance and the safety net.