MINNEAPOLIS, February 25, 2010 - It is unclear whether Congress will stave off a 21 percent cut in Medicare payment rates for physicians before Monday’s March 1 deadline.

Senate Majority Leader Harry Reid had fast tracked a measure that would delay the cut for an additional 30 days. However, Senate Republicans put a hold on the measure earlier this week because of concerns it would add to the deficit, according to Modern Healthcare.

If passed, the extension would be part of a larger package that addresses other expiring provisions that are considered “must pass” items, such as unemployment insurance and COBRA coverage.  The House was also expected to consider the package this week.

The Sustainable Growth Rate (SGR) formula has triggered reductions each year going back to 2003, but Congress has always substituted a last minute pay freeze or modest increase. Meanwhile, the difference between the targeted spending and actual spending on physician services has accumulated each year and led to this year’s massive cut.

The Centers for Medicare and Medicaid Services (CMS) could deal with the uncertainty of the cuts in two ways.

If Congress fails to enact the delay by March 1, CMS could refrain from processing March physician claims for the first 10 business days. The other option is for CMS to pay physicians at the reduced rate until a fix goes into effect, and then reprocess those claims at the full rate.

Physicians have until March 17 to change their Medicare “participating” or “non-participating” status; it is unclear whether that deadline will be extended in response to upcoming Congressional action.

 The AMA has updated its guidance document, “Medicare Participation Options for Physicians” to address important considerations for physicians when making their 2010 participation decision.  That document is available on the AMA web site, at: http://www.ama-assn.org/ama1/pub/upload/mm/399/med-par-options.pdf.

The AMA has insisted that Congress act this year to permanently repeal the SGR formula.

Connect with your lawmakers today by calling the AMA's hotline at (800) 833-6354. Tell your lawmakers what a 21 percent cut would do to your practice and urge them to pass legislation to permanently repeal the SGR formula.