[Congressional Record Volume 153, Number 173 (Thursday, November 8, 2007)]
[Senate]
[Pages S14186-S14187]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      MEDICARE PHYSICIAN PAYMENTS

  Ms. STABENOW. Mr. President, if Congress does not act soon, Medicare 
payments to physicians and health care professionals will be cut by 10 
percent on January 1, 2008 as a result of the fatally flawed 
sustainable growth rate formula.
  This does not make any sense. While costs continue to increase, 
physicians will actually be paid less than they are paid today.
  While a 10 percent cut in 2008 is completely indefensible, it does 
not end there. When combined with the additional cuts required under 
current law through 2016, physician payment rates will be reduced by 
approximately 40 percent.
  What will be the result? Doctors will decrease the number of Medicare 
patients they accept, defer purchase of health information technology, 
and rural outreach services will be discontinued. The Medicare Program, 
which for more than 40 years has lifted countless seniors out of 
poverty, and has ensured access to necessary, affordable, quality 
medical care for our most vulnerable citizens, would be destabilized. 
The health of the nearly 42 million Americans who rely on Medicare 
would be threatened.
  Physicians are the foundation of the Medicare Program and our 
Nation's health care system and patients of all ages depend upon them 
for health care services. Every aspect of our health care system, from 
hospitals to rural health clinics, relies upon the skills and services 
of physicians. Yet, on average, physician payments in 2007 are below 
what they were in 2001.
  It defies common sense to think that payment rates that are lower 
today than they were 6 years ago will be enough to maintain the access 
to care our seniors need. Very simply put, the projected 2008--and 
beyond--payment cuts will place beneficiary's access to health care at 
risk.
  I am proud of the work that over 20,000 M.D.s and D.O.s in Michigan 
do, providing more than 1.4 million seniors and people with 
disabilities in Michigan with high-quality medical services under the 
Medicare Program.
  I want them to be able to continue to do that, but there is simply no 
way that can be expected unless we do something now about the payment 
system used to reimburse physicians for Medicare services.
  Physicians in Michigan will lose $670 million for the care of elderly 
and disabled patients over the next 2 years due to the 10 percent cut 
in Medicare payments for 2008 and the additional 5 percent cut in 2009. 
My physicians are looking at cuts of more than $10 billion by 2016 as a 
result of the SGR formula and 9 years of cuts.
  We certainly cannot expect that physicians can continue to provide 
the same level of care while their payments are cut $670 million over 
the next 2 years alone.
  Several studies and surveys have shown that payment cuts will result 
in physicians modifying their participation in the Medicare Program and 
limiting the number of new Medicare patients they treat.
  We also know from the studies that the lack of a predictable and 
equitable Medicare payment system encourages older physicians to 
retire, discourages younger physicians from entering specialties that 
predominately treat Medicare patients, and hinders investment in health 
information technology.
  In addition to the studies that have been conducted, and our own 
common sense, the Medicare Payment Advisory Commission, an independent 
Federal body established by Congress in 1997 to advise us on issues 
affecting the Medicare program, has been telling us since 2001 that the 
Medicare sustainable growth rate formula is a flawed, inequitable 
mechanism for controlling the volume of services and that it should be 
repealed.
  It is absolutely critical that ultimately Congress needs to enact a 
long-term solution to this issue. In the short term, we need to end the 
practice of dealing with the cuts on a yearly basis in a manner that 
results in deeper automatic physician payment reductions in future 
years.
  At a minimum, I believe we must pass legislation this year that 
provides physicians with 2 years of positive Medicare payment updates 
and do so in a way that does not add to the cost of eliminating the 
SGR.
  By providing 2 years of positive Medicare payment updates for 
physicians, we would avoid having to come back next year facing the 
same issue and would instead create the ability for Congress to develop 
a new, sustainable Medicare physician payment system.
  I thank Senator Baucus, the Senate Finance chairman, for his work on 
behalf of Medicare beneficiaries and physicians and I fully support his 
goal of

[[Page S14187]]

providing a 2-year ``fix'' for physician payments in the package he 
develops in the coming month.
  I share his belief that ultimately we need to repeal the SGR and 
establish a Medicare physician payment system that will provide stable, 
positive payment updates to preserve Medicare beneficiaries' access to 
high-quality care for the long term. I hope we will be able to begin 
that process under his leadership next year.

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