Doctors vs. Hospitals

Among the many items bundled into the fiscal cliff fix there was another delay in implementing cuts to physician payments for Medicare services.  It wasn't hard, though.  Congress has had plenty of practice handling what is called the "doc fix," since it has been doing it almost routinely for the last decade.

As the Kaiser Health News explains:

The 26.5 percent reduction for doctors comes from a payment formula created in a 1997 deficit reduction law. For the first few years, doctors received modest pay increases. But in 2002, doctors reacted with fury when they came in for a 4.8 percent pay cut under that plan. Every year since, Congress has staved off the scheduled cuts. 

Since Congress doesn't want to rush into this thing, it found the money for a one-year patch by cutting reimbursements ... to hospitals.

The package would reduce hospital payments in two ways. First, it would cut $10.5 billion from projected Medicare hospital payments over 10 years for inpatient or overnight care through a downward adjustment in annual base payment increases. The Senate measure also would reduce Medicaid disproportionate share payments to hospitals by an additional $4.2 billion over the next decade.   These cuts are on top of those made to hospitals as part of the 2010 health care law.

Best advice to those on Medicare: don't get sick until Washington has had time to figure this out.  Say, in another ten years or so.