Summer Savings! Get unlimited digital access for 13 weeks for $13.
News Opinion Op-Eds

End the 'doc fix' charade, once and for all

Doctors are breathing a collective sigh of relief because we again escaped a cut in Medicare payments. But this whole recurrent charade underscores, once again, the unresolved issue of how to pay doctors. The fiscal cliff rescue included the usual "doc fix" — an override of the 27 percent Medicare reimbursement cut required by the Sustainable Growth Rate (SGR) law this year. That law has dictated annual cuts in Medicare reimbursement, which have been overridden by Congress annually. Nevertheless, this escape only postponed the crisis for older patients for another year. Moreover, the budget correction required by overriding the SGR seems to have been largely funded by lowering hospital payments instead — also perhaps bad for patients.

It may be that we physicians are paid enough, or at least nearly so. But there is no objective way to calculate reasonable compensation for physicians. After all, what doctors do — preserving health and saving lives — is, in a sense, priceless. Unfortunately, the proposed Medicare cut, annually negated by Congress, has resulted in annual medical mini-fiscal cliffs.

Luckily, there may be a practical, dependable alternative to such incalculable, arbitrary attempts to save on the country's medical care costs.

Shortly after the SGR issue was settled this month, a huge health care budget earthquake occurred when several major insurers announced that premiums would be raised by up to 20 percent. True, rebates may ultimately be required by Obamacare. Regarding that, stay tuned for their calculations of executive salaries and profits. Eluding rebates at year's end will have a much bigger budget impact than the fate of the SGR physician payment cut.

Even aside from the annual SGR-induced attempts to cut Medicare payments, the present Medicare baseline calculation for physician payment is ineffective, requiring fixes by a panel of doctors. This system may have helped the budget for a few decades, but it is not the answer. Doctors' reimbursements, on average, have been decreasing slightly relative to the cost of living, with the midlevel annual income in 2011 of $203,000 for primary care doctors (although up to twice that for specialty doctors — before malpractice premiums). You may think these salaries should be lower, regardless of the even higher earnings of health care business executives.

Nevertheless, using the annual arbitrary Medicare cut in this deteriorating situation has not only been unsuccessful politically — the SGR also fails to target only the areas mainly responsible for increases in billing. The calculation includes cutting payments for basic patient care, which are not rising much. Some physician businesses, including outpatient tests and procedures, are subject to costly and risky overuse. Moreover, these charges are increasing more rapidly. It would be more reasonable for the SGR to target just these less-critical business reimbursements.

In the presently adversarial fee-for-service system, doctors feel justified in their efforts to get whatever they can from both government programs and private insurance. The federal response is understandable. It is partly a response to the finding that in regions with more doctors and hospitals, more medical services are billed, with no evident health benefits. The SGR is a way to offset these unnecessary reimbursements. It has also served as a convenient fiction to support annual budget proposals. Since the override by Congress cannot be predicted in advance, the reduction is included in health care budget predictions — even though Congress always blocks the cut.

Nevertheless, even if not blocked by Congress some year, the way those annual proposed cuts are calculated is weak as a national cost control. They govern only a small fraction of the Medicare budget. Most critically, the system is harmful to core practitioners and those restraining care to what is necessary. As noted above, those key services and appropriate behaviors are caught up in this same federal dragnet as medical business reimbursements. Moreover, total payments to physicians are a small fraction (20 percent in 2011) of overblown U.S. health care costs.

Medicare has shown that attempts at "pay for performance" — paying for paperwork showing compliance with quality — do not incentivize doctors. Surprisingly, New York City recently announced a similar proposal, which promises little better. Fortunately, a key alternative to these unrealistic ideas is emerging.

With the Affordable Care Act's emphasis on clinical quality, doctors in the American Medical Association, American College of Surgeons, the American Board of Internal Medicine and other medical associations have begun to show that realistic cost control can be provided by improving clinical decisions. Through providing the right care and eliminating unnecessary care, doctors can have reliable, relatively realistic incomes; Congress will realize savings; and we can heave a final sigh of relief upon the demise of this annual charade.

Dr. James Burdick is professor of surgery at Johns Hopkins University School of Medicine. He had a career as a transplant surgeon and served in the Department of Health and Human Services as director of the Division of Transplantation. A frequent contributor on health care issues to The Sun, he is writing a book detailing his doctors' plan for health reform. His email is

Copyright © 2015, The Baltimore Sun
Related Content
  • Why don't Dems question Md.'s flawed health exchange rollout?

    Why don't Dems question Md.'s flawed health exchange rollout?

    Who are Gov. Martin O'Malley and Attorney General Doug Gansler trying to kid? The reason potential litigation over the flawed rollout of Maryland's health exchange is being postponed is the upcoming election. They are deeply afraid of what Noridian is going to claim about Lt. Gov. Anthony Brown's...

  • GOP Congress won't do much

    GOP Congress won't do much

    So now the Republicans have control of the Congress ("Republicans seize control of U.S. Senate," Nov. 5). Yeah! How much do Americans think is going to get done now? The next two years will be spent trying repeal the Affordable Care Act.

  • Health site has political overtones

    Health site has political overtones

    The Maryland Health Connection website is certainly much improved from its original debut, but why has it been politicized ("With Obamacare, health insurance leads to better health," Nov. 18)? The prominent heading on the exchange is "Change is here" echoing President Barack Obama's campaign promise...

  • Sun's stupidity is showing

    Sun's stupidity is showing

    You have published several articles recently in support of Obamacare but have chosen to ignore the news of how this hoax was enacted through deception, fraud, misrepresentation of material facts and outright lies ("Who are you calling stupid?" Nov. 14)!

  • Why is The Sun ignoring Gruber?

    Why is The Sun ignoring Gruber?

    This past week several videos have surfaced showing one of the architects of Obamacare saying it only passed because the American people are stupid and were lied to ("Who are you calling stupid?" Nov. 14). According to Jonathan Gruber, our elected officials lied to us about keeping our doctors...

  • Dems' clout dims

    Dems' clout dims

    Sens. Barbara Mikulski and Benjamin Cardin should realize it's not about the bacon; they were elected to protect the residents of Maryland from federal overreach.