WASHINGTON – Salisbury Dr. John Shenasky has had just about enough.
Hit earlier this year with a 5.4 percent cut in Medicare reimbursements, Shenasky said he may abandon his 27-year urology practice if the federal government goes through with a threatened 12 percent cut over the next three years.
“That’s one of the things that will push me over the edge,” said Shenasky, 60. “You can only work so hard, and when you’re not getting fair compensation for what you do, retirement is my option.”
The next round of cuts, which are scheduled go into effect Jan. 1, comes as doctors across the state say they are already working more hours and seeing more patients each day to help cover rising health costs and malpractice premiums.
“The ability of physicians to practice medicine in Maryland is in crisis,” said Dr. Catherine Smoot-Haselnus, president of the state’s medical society.
But other advocates say that while there may be problems with health care, poor doctors is not one of them.
“There is evidence millions of senior citizens can’t afford medicines that doctors are prescribing,” said Robert M. Hayes, president of the Medicare Rights Center. “There is evidence physician income may not be rising. But there is no evidence of them (doctors) facing bankruptcy or not making decent livings.”
Hayes and others say they do not begrudge doctors their money, but that there are other areas of the health care system where the money is more urgently needed.
At issue are new reimbursement rates for doctors treating Medicare patients. The new rate formula, which grew out of the Balanced Budget Act of 1997, led to the 5.4 percent cut this year and was scheduled to bring further cuts over the next three years.
The next cut was supposed to have been officially announced on Nov. 1 by the Centers for Medicare and Medicaid Services, but that announcement was delayed so the centers could re-examine data used in the formula. Center officials said they hope to announce the upcoming cut on Dec. 2, and that it is still expected to go into effect Jan. 1.
The exact amount of the next cut will not be known until the announcement, but it is expected to be around 4.4 percent.
Hayes speculates that there are political pressures behind the delay in announcing the next round of cuts. The American Medical Association has been lobbying against what it sees as potentially explosive cuts.
The AMA estimates that if the full 12 percent cuts in Medicare payment rates are implemented over the next three years, Maryland physicians would lose about $164 million, or $15,668 per physician.
“If they don’t fix the formula, we won’t even take the patients who are 64 going on to Medicare, or take new patients,” said Dr. Paul Fleury, an internist from Pocomoke. “With 50 percent getting decreased and external costs going up, we are at the end of the road as far as being able to absorb pay cuts.”
The independent, non-partisan Medicare Payment Advisory Commission urged Congress to get rid of the current formula and replace it with one that updates prices paid for physician services without also trying to control the total cost of physician services under the program. MedPAC has also suggested the new formula increase payments to physicians by 2.5 percent next year.
But the General Accounting Office said MedPAC’s recommendation would cost approximately $106 billion over 10 years. That increase has the potential to infringe on funds set aside to expand Medicare.
“Congress needs to first enact a drug benefit for Medicare beneficiaries before it starts increasing payments to providers beyond fixing formulas that are incorrect,” said Paul Cotton, senior legislative representative for AARP.
Hayes conceded that physicians are facing a tough time, “but the tough time doctors face is nothing most people with Medicare have trying to get medicine.”
“With continuing tax cuts and shrinking resources, tough decisions have to be made. We vote for prescription drugs,” he said.