CBO projects future Medicare doc fixes will cost billions

by: CHARLES FIEGL May 3, 2010

Fixing Medicare payment rates for physicians is still going to be really expensive, according to the latest estimate from the Congressional Budget Office (CBO).

The CBO updated its score sheet on how much a Medicare "doc fix" will cost in 2011 and beyond. It's noteworthy that the CBO assumes 2010 payments will remain flat for the rest of the year. Payments are set to drop 21.3% on June 1. But freezing rates and preventing the 21.3% sustainable growth rate (SGR) cut from June through December will cost $6.5 billion.

Here's what else the CBO says:

Maintaining 2010 payment rates in fiscal year (October-September) 2011 would cost $9.2 billion extra. A 2% increase in fiscal year 2011 would cost $9.8 billion. Payments would drop 30% in 2012 if no fix was enacted that year.
Extending the current pay rate through 2020 would cost an extra $275 billion.
Using a Medicare Economic Index of 0.7% to 1.8%, annual increases to physician payments in fiscal years 2011-2020 would cost $329.9 billion.

Update: The fiscal year 2011 figures in the first bullet have been corrected (the previous version included calendar year estimates for 2011). The cost of freezing rates during calendar year 2011 is $15.4 billion. A 2% increase during calendar year 2011 would be $16.5 billion.

To comment, login here.

Login

User Name:
Password:
Remember me Forgot password
Welcome to the new Part B News Online. If you are a returning user having trouble logging in, please click here.