Hospitals, tax-scofflaw docs targeted in House Medicare deal

Staff Writer
Columbus CEO

WASHINGTON (AP) — House aides released an outline late Friday of an emerging bipartisan deal shielding physicians from Medicare cuts and pumping more funds to popular programs for children's health and community health centers.

In a first hint of some of the measure's fine print, the bare-bones summary said lawmakers would raise money partly by targeting Medicare providers who are tax scofflaws. In the winner's category, the agreement would also help Tennessee hospitals serving large numbers of poor patients and makers of medical equipment who bid for Medicare business.

The one-page document provides no price tags and few specifics. But as lawmakers, congressional aides and lobbyists have said for days, it would cost roughly $210 billion over a decade, with around $140 billion financed by adding to federal deficits, aides said Friday. The remaining $70 billion would be split about evenly between Medicare providers and beneficiaries.

House Speaker John Boehner, R-Ohio, and Minority Leader Nancy Pelosi, D-Calif., have been seeking the agreement for two months in hopes of resolving a problem that has haunted Congress for years.

As medical inflation soared, a formula in a 1997 budget law aimed at reining in Medicare costs has ended up threatening doctors with deep cuts in Medicare reimbursements that lawmakers have staved off every year since 2003. Physicians have warned the constant threat of cuts could prompt them to stop treating Medicare patients.

The bipartisan compromise would erase that formula, including averting a 21 percent cut in physician Medicare reimbursements set for April 1. Instead, the plan would give Medicare physicians 0.5 percent annual fee increases for the next five years and offer financial incentives to charge patients for quality of care, not for each treatment.

In a letter to House Democrats Friday, Pelosi hailed the measure for "providing certainty to our seniors and stability to providers." On Thursday, Boehner said it was a chance to "solve this problem once and for all."

House leaders hope to push the measure through their chamber by late next week, shortly before Congress begins a two-week spring recess.

Its Senate fate is less clear. Democrats there have complained that the measure should extend a children's health program for four years, not just two as in the agreement. They also dislike its increased costs for some Medicare beneficiaries and language curbing abortions at community health centers.

The summary says federal payments to Tennessee hospitals for treating low-income people would be extended through 2025.

It would help major producers of durable medical goods and prosthetic devices by penalizing low-ball bidders for Medicare business. That provision comes from a House-passed bill sponsored by Rep. Pat Tiberi, R-Ohio, whose state is home to Invacare Corp., one of the country's largest makers of home medical devices like wheelchairs.

According to the summary and aides familiar with details:

—About 2 percent of the country's highest earning Medicare recipients would face higher premiums for doctor and prescription drug coverage. The higher premiums would apply to individuals earning between $134,000 and $214,000 and couples earning between $267,000 and $428,000.

—Starting in 2020, some people buying Medigap plans — which insure some expenses Medicare does not cover — would have to pay higher out-of-pocket costs up to the Medicare deductible for doctors' coverage, currently $147 annually.

—For providers owing delinquent taxes, the government would be allowed to withhold 100 percent of what they owe from their Medicare reimbursements.

—A 3.2 percent increase in Medicare payments to hospitals in 2018 would instead be phased in over six years.

—Nursing homes, hospices and home health providers would be held to a 1 percent Medicare increase in 2018.

—Scheduled cuts in payments to states for hospitals treating poor patients would be delayed a year to 2018 but also extended through 2025.

The measure would also finance the Children's Health Insurance Program, due to exhaust its funds Oct. 1, for two more years at higher levels provided under President Barack Obama's 2010 health care law.

It would make permanent a program that helps poor seniors pay Medicare deductibles and another program that helps some families keep Medicaid coverage as they move from welfare to jobs.