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Capitol Health Call
July 13, 2005

Boosting Medicare Pay

JAMA. 2005;294(2):171. doi:10.1001/jama.294.2.171-a

Medicare payment cuts planned for next year will be reversed if two bills introduced in Congress in May get signed into law.

Under the current Medicare reimbursement formula, which is tied to the US gross domestic product, payments to physicians would be reduced by 4.3% beginning next year. Over the next 6 years, physician payment would fall 26%. But the two bills (each called the Preserving Patient Access to Physicians Act of 2005) would be tied to the Medicare Economic Index and increase payment by about 2.6% for 2006. Fees would then rise annually based on national increases in practice costs. The change will cost an estimated $25 billion to $35 billion over the next 5 years.