Medicaid/Medicare Physician Compensation

Less Money for Preventive Care, More Money for Docs

Merrill Goozner reports that paying for the “doc fix” comes at the cost of preventive services.

Friday’s payroll tax cut extension bill included $18 billion to maintain Medicare physician salaries at current levels for the rest of this year. Unlike the payroll tax extension, Congress insisted on paying for the doc-fix with offsetting budget cuts.  They raised nearly a third of the money by cutting $5 billion from prevention programs initiated under the Affordable Care Act. The rest came from reduced payments to hospitals, nursing homes, and clinical labs, and reduced Medicaid payments to Louisiana.

Smoking cessation programs? Cut. Outreach to schools to get kids to eat more fruits and vegetables? Cut. More programs at local YMCAs to prevent diabetes? Cut.“The idea of paying for a ten-month fix in physician payments with a ten-year cut in prevention programs is the ultimate penny-wise, pound-foolish move,” said Richard Hamburg, deputy director of Trust for America’s Health, which lobbies for community prevention programs and more funding for state and local health departments.

Preventive care programs may improve the quality of life for some individuals, but according to the CBO expanded use of preventive care “leads to higher, not lower, medical spending overall.”  Thus, although cutting preventive care may seem to increase medical costs in the long-run, in practice the deal to cut preventive care services should save enough move to pay for this year’s doc fix.


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