Before adjourning for the year, Congress passed legislation that will delay the scheduled 5.1% Medicare physician pay cut by one year, reports CQ Today. Medicare payments to physicians will be maintained at 2006 rates, and physicians will also receive a 1.5% bonus if they report on quality measures. But next year, Congress will again have to grapple with the Medicare formula that mandates the payment cuts. In the spring, however, the Medicare Payment Advisory Committee will issue a report to Congress with recommendations to replace or change the physician payment formula, and it will likely have a pay-for-performance component to it.
The bill also expands the amount of money that can be contributed tax-free to health savings accounts, reports The Washington Post. Currently, individuals are limited to making a contribution that cannot exceed their annual deductible. The new law, which awaits President Bush’s signature, allows any individual with an HSA to contribute $2,850 per year, and families can contribute $5,650. The larger HSA tax benefit is expected to cost the government $1 billion in tax revenue.
