Temporary Payroll Tax Cut Continuation Act of 2011

picture fun from icanhascheezburger.com

Signed into law on December 23, 2011 (right before the holiday hiatus in Washington D.C.) the Temporary Payroll Tax Cut Continuation Act of 2011  extends, amongst other things, the 27.4% Medicare cut that was once again hanging over your heads.  The extension is for two months- January and February of 2012.  The President is trying to get everyone to pass a measure that would stall this again, for the rest of the year.  There are several concerns:
1) Sustainable Growth Rate (SGR), 2) any changes to the schedule rates must be budget neutral (the relative value units used to calculate the fee must also have money set aside to back them), 3) the government has been extending the rates and holding on the cuts for most of a decade now and it is to the point that without a permanent fix cuts are expected to top 30% by next year (2013), 4) temporary fixes, at this time, need to end, a permanent solution needs to be addressed and implemented without it, a Medicare care disaster of epic proportions is on the horizon.

It’s starting to feel like last year all over again, isn’t it?  This is looking like another loose thread, ready to be pulled and further fray the many loose edges of the Obama healthcare plan.  Now, it’s not fair to lay this entirely at President Obama’s feet, as we’ve mentioned this has been an ongoing problem for at least a decade now.  However, with all of healthcare areas that the President is seeking to control and manage, it puts a glaring light on this problem and it's a significant and awkward problem that can and potentially will undermine large chunks of his healthcare reform agenda if it is not fixed- permanently.

The AMA (American Medical Association) and 99 other medical societies and associations think they have come up with a resolve for how to offset the pay (i.e. make the costs “budget neutral”) by using the money Congress had allocated for Overseas Contingency Operations (OCO) to help fund a permanent fix to the sustainable growth rate (SGR) formula.  Per this group, the OCO budget line is no longer needed for the Iraq and Afghanistan wars and could be used to fix the SGR issue.  That’s all well and fine, but as we all know, it is quite likely that that line item has already been slashed or otherwise allocated before anyone thought to reallocate it for the SGR.  No harm in trying- keep thinking everyone.

As always, keep your fingers crossed, think happy thoughts, make sure that your billing is up-to-date and out before March 1st, and wait with baited breath.  We’ll cross our fingers and keep watching to see what happens with you.