Last Thursday, the Senate failed to act on HR 6331, the Medicare bill that passed overwhelmingly in the House. This Medicare bill would stave off a 10.6% rate cut for physicians beginning on July 1st. This cut was part of a 1997 balanced budget deal to trim the money going to Medicare, but physicians have been able to regularly postpone the cuts. The 1997 bill also included the Medicare Part B therapy caps that have also been either postponed or have been rendered harmless through an exceptions process. The caps would also go into effect on July 1st without this legislation.
HR 6331 would “pay” for the postponement of the physician rate cut by cutting the subsidy given to the private Medicare Advantage plans. President Bush has threatened to veto the bill if it includes this cut to the insurance plans. The administration would pay for the postponed physician rate cut by cutting other provider group reimbursement, such as eliminating the market basket rate adjustment for skilled nursing facilities and home care agencies.
The original Senate vote was 59-39 (Sen. Ted Kennedy and Sen. John McCain absent). Sen. Harry Reid changed his vote to No (final vote 58-40) so that he can bring the bill up again when the Senate returns on July 7th. Both the Senate and House are now on 4th of July recess (known as “District Work Period”).
The Bush administration gave a reprieve to the physician rate cut on Sunday. The Department of Health and Human Services will essentially freeze the current pricing system until Congress returns. Congressional aides said the freeze could last 10 days. If the legislative dispute lasts beyond the new deadline, HHS Secretary Leavitt said he hopes to retroactively pay doctors once the dispute is resolved.
The therapy caps were not included in this reprieve and will go into effect on July 1st. Congress is expected back on July 7 and it is anticipated that a vote will be taken that week.