We debunk GOP Rep. Peter Roskam's recent claim that "hidden" in the Democratic health care law is a "21 percent cut in payment to Doctors treating Medicare patients."
Rep. Peter Roskam has been active on Twitter these past few weeks, using the platform to chronicle the purported "massive new costs, delays, [and] hidden problems" of the recently-passed health care bill. Not surprisingly, his attacks on the bill are often misguided and misleading.
For instance, take a look at his daily lesson last Thursday, in which he suggested that "hidden" in the Democratic health care law is a "21 percent cut in payment to Doctors treating Medicare patients." In a longer post on his House website, Roskam makes clear that he's referring to a proposed change in the Medicare Sustainable Growth Rate (SGR), the formula that each year determines the reimbursement amount for doctors who treat Medicare patients.
A bit of background on the SGR: Because it was poorly designed when first enacted in 1997, the formula -- when left to its own devices -- establishes massive reimbursement cuts each year that the authors never intended. To avoid this, Congress has passed temporary fixes. When they initially embarked on health care reform this past year, Democrats expressed interest in rewriting the formula permanently. The House even included new language in an early version of the bill. But they later set aside the so-called "doc fix," opting to deal with it in a separate piece of legislation after the reform battle had ended. But they also never got around to passing the latest temporary patch. As a result, this year's "21 percent cut" technically went into effect on April 1.
So back to Roskam's tweet.
In saying that the 21 percent cut to Medicare reimbursement rates is "hidden" in the health care bill, Roskam is suggesting -- like GOP Rep. Paul Ryan before him -- that the health care reform law somehow relies on the savings from that cut to remain deficit neutral. That simply isn't true.
While House leaders briefly floated the idea of solving this longstanding problem in their bill, "doc fix" and the Democratic health care reform package are really unrelated. Without a new patch, the 21 percent reduction would have gone into effect even if Republicans had killed the reform bill. And contrary to the suggestion from Ryan and other Republicans, the Democrats did not use the savings from the scheduled cut to offset the costs of the reform law, as the New Republic's Jonathan Chait has pointed out:
Democrats did not instruct the CBO to credit savings from reducing physician pay toward the health care bill. Every dollar of new health care spending is offset by different savings. The purported cut in physician pay is not part of those savings. There are parts of the CBO score you can legitimately suggest underestimate the cost of health care reform -- most prominently, the slowdown in value of the tax credits over the second ten years. (I'd argue that there are places where CBO is underestimating cost savings, as well.) But the doc fix is simply not a legitimate complaint.
Moreover, rather than trying to hide the "doc fix" problem, congressional Democrats are currently working to solve it. Already, they've tossed a temporary patch into the unemployment benefit extension bill (H.R. 4851) the Senate is voting on this week (which would have passed before the spring recess ... had GOP Senators not filibustered it).
More encouragingly, the party has promised to fix the problem permanently later this year, something Republican majorities failed to do when they had the opportunity in 2003, 2005 and 2006.
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