Delay in Medicare payment fix could mess up doctors’ federal cash flow

The Senate announced Tuesday that it’s ready to take up a 19-month Medicare “doc fix,” but action will probably come too late to avoid cash-flow problems that could affect doctors across the country. Sen. Charles Schumer (D-N.Y.) said at a press conference that the Senate is expected to have 60 votes to pass the bill “early next week,” but it may still take several days to be passed by the House and signed into law by President Barack Obama.

That’s bad news for doctors, who will see a 21.3 percent cut in their Medicare payment rates starting Tuesday, June 15. The cuts were scheduled to start June 1, but the agency that oversees Medicare has asked contractors to delay processing claims for 10 business days — the maximum it can delay payments under law — to give lawmakers time to act.

After that, “we begin paying claims based on the current law,” said Peter Ashkenaz, a spokesman for the Centers for Medicare and Medicaid Services.

After Tuesday, doctors will have two basic choices on how to proceed, but either one will at least temporarily hurt their bottom line.

They can decide to file their claims immediately and get paid at the reduced rate for services provided between June 1 and the date of enactment of the new law, which would prevent the cuts and give physicians a 2.2 percent pay boost for the remainder of the year and an extra 1 percent pay boost for 2011. The Senate substitute “doc fix” is retroactive to June 1, so if it passes the Centers for Medicare and Medicaid Services would reprocess the claims filed between June 1 and enactment of the new law and physicians would eventually get paid the full amount.

Some doctors may also decide to wait to file their claims until the “doc fix” is passed, in which case they’d never get hit with the 21.3 percent cut but would get paid later than they normally would.

The provision costs almost $22.9 billion. The House passed it as a separate bill on the Friday before the Memorial Day recess, by a vote of 245 to 171.