Medicare

How Squabbling Over Obamacare Derailed the Doc Fix


Last month something unusual happened in Congress: Serious lawmakers from both parties came up with a compromise to solve a long-running policy problem. The so-called doc fix would have permanently corrected Medicare’s broken formula for paying physicians. It’s a problem Congress has staved off for more than a decade with short-term patches. Doctors’ reimbursements from Medicare are set to drop 24 percent overnight when the latest patch expires on March 31.

That moment of cool-headed, rational lawmaking appears to be over. The doc-fix deal is unraveling into familiar partisan squabbling over—wait for it—Obamacare.

The big question unanswered in the February compromise was how to come up with the roughly $138 billion over 10 years to pay for it. The Republican-controlled House pushed its solution: Pay for the doc fix by delaying for five years Obamacare’s individual mandate, which requires all Americans to get health insurance or pay a fine.

That would save the government money because people who decided not to buy health plans wouldn’t collect the subsidies that the Affordable Care Act offers to low- and moderate-income people. It would also destabilize the insurance markets, as insurance companies would miss out on revenue from healthier, lower-risk people who chose not to enroll, likely sending premiums higher. It would basically gut the health-care law and leave millions more uninsured—a nonstarter in the Democrat-controlled Senate. Obama threatened a veto. Nonetheless, the House passed its bill today, with 12 Democrats joining Republicans in favor. Senate Republicans offered a similar bill.

“This policy will only become law if Congress collaborates in a bipartisan manner to resolve the fiscal matters associated with this legislation,” American Medical Association Chief Executive Officer James Madara wrote (PDF) to House leaders on March 13. “We renew our call for all parties to engage in good faith, bipartisan efforts to address the budgetary implications of this bill and enact it.”

It sounds so simple when you put it that way.

John_tozzi
Tozzi is a reporter for Bloomberg Businessweek in New York.

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