CBO: ‘Doc fix’ patch to cost about $8.7 billion

A proposed patch sparing Medicare physicians a 24 percent pay cut next year would cost about $8.7 billion, the Congressional Budget Office said Wednesday.

The House measure would provide doctors with a 0.5 percent payment update through March 2014 while allowing Congress several months to overhaul Medicare’s flawed physician payment system.

To partially fund the three-month fix, the House bill would prolong a series of cuts set to hit hospitals that serve primarily uninsured and low-income patients under Medicaid.

The reductions to so-called disproportionate share hospitals are scheduled to begin next year and last through 2022. Under the bill, the cuts would begin in 2016 but last through 2023, raising about $4 billion.

The measure would also introduce site neutral payments for some services performed in long-term care hospitals.

Under this policy, certain procedures performed in long-term care settings would only cost as much as they would if performed in other medical settings, raising money for the short-term “doc fix.”

Lawmakers hoped to repeal Medicare’s sustainable growth rate by the end of the year, and committees continued to meet this week in preparation for a vote.

A long-term solution has eluded Congress for more than a decade, leading to a pile of physician reimbursement cuts that must be regularly averted.

But with just days left before the House leaves for the holidays, a short-term patch is all that’s expected in 2013.