Medicare group urges 1% raise for physicians

April 10, 2011

The Medicare Payment Advisory Commission urged lawmakers to boost physician pay by 1% in 2012, despite a rate cut set to take effect the same year.

The Medicare Payment Advisory Commission (MedPAC), an independent counsel that advises the U.S. Congress on Medicare, urged lawmakers to boost physician pay by 1% in 2012, despite a rate cut set to take effect the same year.

In MedPAC's "Report to the Congress: Medicare Payment Policy," the group notes that the raise "will ensure beneficiaries have continued access to [physician] services," according to a statement, but says that it "will not solve the fundamental problem with current Medicare fee-for-service payment systems-that providers are paid more when they deliver more services without regard to the quality or value of those additional services."

The commission also acknowledges that the Sustainable Growth Rate (SGR), a formula used to calculate physician compensation, must be fixed. The SGR calls for a reimbursement cut of more than 25% in 2012 if Congress does not intervene.