Time to permanently fix the Medicare ‘Doc Fix’

November 26, 2014

by Nick Novak

Originally published by The Washington Times.

Washington is primed for Medicare reform. If nothing is done, the trust fund that covers the hospital bills for nearly 50 million Americans will run out in less than two decades.

It is imperative that congressional leaders take action because it would be immoral for the government to break its promise to millions of seniors across the country who rely on this program. But before Congress can even think about reforming Medicare, it needs to fix a phony spending formula that has been broken for more than 10 years and hides the true cost of Medicare.

The spending formula I am referring to is the Sustainable Growth Rate (SGR) that was instituted in 1997. Congress, in an effort to keep costs down, created the SGR to provide for physician reimbursement rate cuts. It was done to make sure Medicare spending did not outpace the rate of economic growth.

This idea would save taxpayers billions of dollars over the years and that is exactly what would have happened if it had been in effect. Instead, Congress passed a temporary delay in 2003 to keep the cuts from going into place. Since 2003, Congress has passed a temporary delay 17 times.

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