Congress has approved a one-year extension of Medicare payment rates for physicians, avoiding steep cuts that would otherwise have taken effect. Rather than finding a better long-term alternative to the current payment formula, lawmakers have repeatedly used stop-gap measures to prevent payment cuts. Last week’s extension — the fifth this year —will continue current rates through 2011 at an estimated cost of $14.9 billion.
Lawmakers offset the bill's total cost over ten years primarily by adjusting a provision in the health care reform law that requires consumers who receive health insurance subsidies to repay part of those subsidies if their reported income is found to be inaccurate. When the offsets and additional health provisions included in the bill are taken into account, the bill will increase deficits by $17 billion over five years.