Legislation increases physician pay, extends SCHIP

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Congress on December 19 passed legislation that will stop a 10 percent decrease in payments to physicians that was to go into effect Jan. 1, 2008, and also extends the State Children’s Health Insurance Program (SCHIP) until March 31, 2009. The Bush administration praised the legislation for extending the SCHIP program without raising taxes. President Bush is likely to sign the legislation into law.

The “Medicare, Medicaid and SCHIP Extenders Act of 2007� (S2499) replaces the scheduled 10.1 percent cut to the Medicare physician reimbursement rate in 2008 with a 0.5 percent increase through June 30, 2008. The legislation also extends a provision that provides a 5 percent bonus payment to physicians practicing in physician shortage areas through June 30, 2008.

The increased costs related to physician payments would be primarily offset by removing $1.2 billion from the Medicare Advantage stabilization fund for regional preferred provider organizations in 2012.

In addition, the bill: (1) extends the exceptions process for therapy caps until June 30, 2008; (2) permanently freezes the inpatient rehabilitation services compliance threshold at 60 percent; (3) extends the separate payment for brachytherapy services through June 30, 2008; (4) extends reasonable cost payments for certain clinical diagnostic laboratory tests in rural areas; (5) requires CMS to adjust its average sales price calculation to use volume-weighted ASPs based on actual sales volume, regarding payment for Part B drugs.
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