As it stands now, primary care physicians would see reimbursements grow as much as 8 percent, while payments for imaging services would be cut up to 30 percent. The changes reflect major concerns over the growing costs of imaging services.

However, the proposed rule does include plans to “remove physician-administered drugs from the definition of ‘physician services’ for purposes of computing the physician update formula in anticipation of enactment of legislation to provide fundamental reforms to Medicare physician payments.”

The AMA has been calling for this action since 2002 to clear the way for Congress to repeal the flawed Medicare physician payment formula.

“We are very pleased that the Obama administration agrees with the AMA that drugs do not belong in the physician payment formula,” said James Rohack, M.D., AMA president.

The proposed fee schedule also has an update to the practice expense component of physician fees. For 2010, CMS wants to include data about physicians’ practice costs derived from a survey, the Physician Practice Information Survey, designed and conducted by the AMA.

The Medicare law requires CMS to adjust physician fee schedule payment rates annually, based on a formula that includes application of the Sustainable Growth Rate (SGR) adopted in the Balanced Budget Act of 1997.

This formula has yielded negative updates every year beginning in 2002. CMS took administrative steps to avert a reduction in 2003, and Congress initiated a series of legislative actions to prevent reductions from 2004 to 2009.

The ISMA urges you to contact Indiana’s congressional delegation and ask that Congress not base any new health care reform payment system on the current Medicare payment policy.

Find contact information for the Indiana delegation here.

Access an action kit with information to help you discuss the impact of Medicare payment cuts here.

See the proposed fee schedule in the Federal Register here.

The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) replaced scheduled double-digit Medicare cuts with a 1.1% increase for 2009. However, on January 1, 2010, Indiana physicians face an across-the-board cut of 21%, producing a loss of $290 million for the care of elderly and disabled patients. On average, each Indiana physician is facing a Medicare cut of $21,000 next year.