ACP says Medicare cuts will hurt physicians in small practices

ACP asks Congress to pass legislation to avert pending pay cut

(Washington) – Noting that many physicians across the country who lead small practices are at a business breaking point, David M. Dale, MD, FACP, president of the American College of Physicians (ACP) testified today before the House Small Business Committee. Dr. Dale emphasized that practices are medicine’s small businesses, where much of their revenue is tied directly to Medicare’s flawed reimbursement rates and formulas.

Approximately 20 percent of ACP members who are involved in direct patient care are in solo physician practices. And, about 50 percent are in practices of five or fewer physicians.

On July 1, physicians face a 10.6 percent cut in Medicare reimbursements. Another 5 percent cut is anticipated on January 1, 2009. The Sustainable Growth Rate (SGR) formula that is used to calculate Medicare payments to physicians was created in 1997 and ties physician payments to growth in the overall economy. When growth in physician expenditures exceeds growth in the economy, the difference is subtracted from physician payments. The SGR formula has led to scheduled annual cuts for six consecutive years.

Earlier this year, ACP surveyed its members to measure the impact of pending Medicare payment cuts on their practices and on their patients. The questionnaire asked internists to report on the changes they would be forced to make if Congress does not act. Although the survey was not designed as a scientific sample, almost 2,000 internists responded, providing ACP with first-hand accounts of how the SGR cuts are affecting millions of Medicare beneficiaries.

Dr Dale cited the story of one respondent, a Texas internist, who said: