WASHINGTON— The American Academy of Ophthalmology today praised two bills recently introduced in the Senate and House that are both intended to avert the 4.5 percent cut in Medicare physician reimbursement rates scheduled for January 2006. The Academy, along with the AMA and other health care organizations in the AMA-led coalition, have endorsed the legislation recently introduced by Senate Finance Committee members Sen. Jon Kyl, R-Ariz., and Sen. Debbie Stabenow, D-Mich., and by House Ways and Means Committee members Rep. Clay Shaw, R-Fla., and Rep. Ben Cardin, D-Md.

Kyl and Stabenow introduced the “Preserving Patient Access to Physicians Act of 2005” (S. 1081). Shaw and Cardin recently introduced H.R. 2356, which shares the same title. Both bills provide at least a two-year fix starting with a 2.7 percent increase for physician payments in 2006. The House bill is a permanent fix and repeals the flawed Sustainable Growth Rate (SGR).

Kyl acknowledged that his bill is a starting point for discussion, saying. “I would really like to see us go all the way back to the drawing board and answer the fundamental question of how to pay physicians appropriately for their services.” 

“A majority of ophthalmologists’ patients are Medicare beneficiaries. In terms of absolute dollar payments received from Medicare when compared to other specialties, we rank third behind general internal medicine and cardiology and we receive the highest percentage of our income from Medicare,” said William Rich III, MD, Academy medical health policy director. “Cuts in Medicare payment rates will hit ophthalmology especially hard. That’s why the Academy is committed to making sure its Members are not forced to limit their care of Medicare patients. Stopping the cuts and fixing the SGR problem are our highest priorities.”

While leaders of both the Senate Finance Committee and the House Ways and Means Health Subcommittee have signaled their commitments to a fee fix for physicians this year, the Academy notes that they have also made it clear that any fix must be linked to a new system that rewards physicians for improving the quality and efficiency of the health care delivered to Medicare patients. The leaders have indicated that their forthcoming legislation is expected to include “Pay for Performance” requirements and incentives for increased use of information technology.

Cost will continue to be the biggest obstacle to a fix. The House Senate Budget Resolution calls for $1 billion in Medicare cuts that must be reconciled by Sept. 20, 2005. Estimates of the cost to pass even a two-year fix with an increase of only 1.5 percent are more than $20 billion. A permanent fix that replaces the SGR with updates similar to the Medicare Economic Index is now estimated to cost $150 billion.

"Although the bills are a hopeful sign, passage of a fee fix will still be difficult because of the costs, the budget environment and the desire of many in Congress to link a fix to a new system of Pay for Performance and adoption of health information technology,” said Catherine G. Cohen, Academy vice president of government affairs. “Also, AARP has expressed reservations about how a physician fee fix might impact the costs of seniors’ premiums.”