Under the terms of the Affordable Care Act, Medicare payments to doctors would have been cut by 25%. Congress has been passing a number of so-called “doc fixes” to prevent the implementation of this provision.
In June a six month extension was passed with much effort. Republicans had filibustered the bill which included the “doc fix” and were joined by Senators Ben Nelson (D-Neb.) and Joe Lieberman (I-CT). Eventually the short extension of the “doc fix” passed.
The current Senate bill which is expected to also pass in the House would be the longest extension of the “doc fix” enacted this year. The extension would go into effect on January 1, 2011.
President Obama has indicated his support for the bill and is expected to sign it when it reaches his desk. In a statement released by the White House the President said
"I am pleased Democratic and Republican leaders in the Senate have agreed on legislation that will prevent a significant pay cut for doctors from taking effect and help ensure seniors on Medicare can continue to see the doctor they know and trust,"
The price impacts the middle class most
Republicans who had consistently blocked funding for similar bills reached an agreement with Democratic leaders which allowed the bill to be passed unanimously in the Senate.
Payment for this extension of the “doc fix” will come from reducing the subsidies which the Affordable Care Act (ACA) offered to help families pay for health insurance which will be mandated in 2014.
The original terms of the ACA called for federal subsidies for families making up to 4 times the federal poverty level. A family of 4 whose income is less than $88,000 per year would be entitled to federal help to pay for mandated health insurance.
The new “doc fix” extension does not change the eligibility level but changes the recapture provision of the health care law from a flat fee to a sliding scale repayment. Recapture, or repayment of the government subsidy, would be assessed if the family income rose above eligibility guideline or if the family misstated its income.
Under the original ACA provisions, recapture would be assessed at a flat rate of $250 to $400 per family. Now a sliding scale recapture rate has been implemented which would be based on income with payments for higher incomes. Families whose income rises too much could pay between $600 and $3500 in recapture fees.
Republicans had promised that if they could not repeal the health care law they would cripple by defunding as many of its provisions as possible. The passage of this bill indicates that they have started this process. Democrats maintain that this compromise does not impact the very poorest citizens.
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