Senate Finance Committee Discusses Impact of Medicare package to delay payment cut

Senate Finance Committee Chair Max Baucus (D-Mont.) has indicated that a Medicare package that would delay for 18 months a 10.6% cut to physician fees would cost between $15 billion and $18 billion over five years, prompting committee members to begin discussions on how to offset those costs. Committee members continue to examine reducing payments to private insurers that administer Medicare Advantage (MA) plans as a potential offset for the bill. MA plans, on average, are paid an estimated 113% of what traditional Medicare pays per patient.

The Bush administration has asked Congress to approve the legislation delaying the fee cuts, which are scheduled to take effect on July 1, by June 16 to avoid delays in payments that would result in additional administrative costs.