The 'Doc-fix' is Behind Us. Are you Ready for 'Hosp-fix'?

Congress passed the doc-fix for another 12 months.

There was some controversy in the House since it was passed on a voice vote, but it would have passed under any kind of vote. It is difficult to vote against your doctor. For those who have never met a doc-fix, let me introduce you.

During the discussions surrounding the 1997 Balanced Budget Act it was clear that there would have to be some restraints on the rapidly increasing costs of physician reimbursements under Medicare. The leadership of the American Medical Association was invited in for a series of meetings with then-Speaker Newt Gingrich and several members of the Republican leadership involved in the issue.

The solution arrived at was the “sustainable growth rate”. Doctor’s payments were tied to statistical indicators of their costs and workload.

Photo Credit: Getty Images.

All went well until 2003 when the formula required a significant reduction in physician’s reimbursements. The physician cuts would be about 8 percent and every member of Congress heard from their physician, their spouse’s physician and their spouse. It was just not right to expect our doctor to suffer that kind of a reduction in income.

Congress acted to “patch” the shortfall in doctor’s reimbursements and it became known as the doc-fix.

Congress has voted 17 times in the last 11 years to prevent the payment reductions. The problem was like pushing a snowball uphill. It kept growing with each passing day and had Congress not acted by March 31, the cuts for doctors would have been 24 percent.

Every time the doc-fix comes up for a vote the question comes down to how to pay for it. What will be cut elsewhere in the budget to make money available for the docs? In each debate no conclusion is reached and the bill is passed unpaid for. The cumulative cost of the past fixes has added $150 billion to our debt.

(AP Photo/Jon Elswick, File)

That is the lesson of our dysfunctional federal budgeting. Everyone agrees with the need for a fix, but no one agrees on how to pay for it, so we just add it to the debt.

This all comes to mind with the recent celebration of the success of the Obamacare roll out. We are told that, as predicted, seven million people enrolled in the program. Now comes the hard part. It has to be paid for.

During the debate in late 2009 the costs of health care reform were causing some hesitation among some of the Democrat’s. It became clear that if the cost exceeded $1 trillion over the first 10 years the votes would not be there to pass it.

The Congressional Budget Office was working 24 hours a day scoring and re-scoring each proposed change. The slush fund for reaching the magic number was Medicare.

The White House and Congressional leadership agreed that some of the revenues for Obamacare would come from “future savings” in Medicare. If the CBO score showed Obamacare costing above $1 trillion, the Medicare cuts were increased to get below that number.

(Photo: Shutterstock)

Finally, the president made the triumphant announcement that the cost of Obamacare would “only” be just over $900 billion. The Medicare cuts to reach that number came to $716 billion.

Over the time left in that decade Medicare spending is projected to be in the range of $7 trillion from which Obamacare promises to cut $716 billion.

Hospitals across the country have been closing over the last 15 years, particularly in rural areas. California is projected to see 10 percent of its hospitals close over the next decade.

A further 10 percent cut in hospital reimbursements over the next eight and a half years will bring political pressure to “save our hospital” far greater than the doc-fix. It will come from hospital administrators and their Washington lobbyists to be sure, but the real impact will come from home with every citizen in the district worried about “losing our hospital.”

Can you say, “hosp-fix?”

John Linder served in Congress for 18 years from Georgia. He and his wife, Lynne, have retired to a farm in Northeast Mississippi. He can be contacted at: linderje@yahoo.com

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