The Medicare Equation In 2007

More is less– it's the law.

The current regulations governing Medicare and Medicaid payments play out like this. When services go up ­ reimbursements go down. As physicians provide more services per patient the spending by Medicare increases faster that the overall economy, and when cumulative spending targets established by the Center for Medicare and Medicaid exceed economic growth, reimbursements to doctors are cut. A 5% percent drop is predicted. Doctors in turn predict that any reduction in services to keep spending down will only result in diminished patient care.

The federal government is probably left with two choices. One, increase reimbursement rates to cover the difference between current service levels and economic growth or, two, adjust reimbursement rates to pay doctors on a Pay for Performance basis. Increased reimbursements per sea promise financial stability for doctors while Pay for Performance rates promise appropriate pay for proven outcomes.

The question remains. What drives medicine? Is it money for any and all services regardless of outcomes ­ or money for proven performance? The doctor's voice is needed to help the government reach a workable solution.