Weekend Update

The Centers for Medicare and Medicaid Services (CMS) announced last Wednesday that “Based on the bids submitted by [Medicare] Part D [prescription drug] plans for the 2011 plan year, CMS estimates that the average monthly premium that beneficiaries will pay for standard Part D coverage will be $30 — a $1 increase from the current year (2010) average premium of $29.” OPM should announce 2011 FEHB plan premiums in the middle of next month.

Earlier this month, the Congressional Research Service issued a report on the history of the Sustainable Growth Rate (SGR) formula that Congress adopted in the 1990s to annual adjust the Medicare Part B reimbursement formula for physicians. Since 2002, the formula has produced a negative update which Congress has overridden except in the first year, 2002.  The AMA News notes that according to the Medicare trustee’s August 5, 2010, upbeat report on the Medicare program’s solvency

Projected annual spending growth for Part B is estimated to average only 5.3% during the next five years, about the same as the GDP growth rate, the report said. But this assumes deep physician pay cuts will take effect. Unless Congress steps in, physician rates are scheduled to decline 23% on Dec. 1, an additional 6.5% in January 2011 and 2.9% in 2012.

It’s unclear whether Congress will have the opportunity to reevaluate the SGR formula when it returns from recess next month for a short work session before the No fullyvember elections. Congress may kick the SGR can down the road again.