With the specter of a 21.2 percent reduction in Medicare reimbursements on June 1, local physicians variously describe the mood among their colleagues as shellshocked and a mixture of frustration and resignation.

On Thursday, President Barack Obama signed the Continuing Extension Act of 2010, retroactive to April 1, which blocks the reduction in reimbursement until June 1, the third time this year it has been pushed back.

“They just keep kicking the can down the road,” said Amelia Pare, a South Hills plastic surgeon, who said her office had put off hiring until they have a better idea what Congress will do.

At issue is the Medicare Physician Fee Schedule, which uses a formula that determines how much doctors get paid for treating Medicare patients based on a number of cost-related factors including inflation and geographical location.

The rub is that the Balanced Budget Act of 1997 requires that the rate must align the program’s budget with ever-escalating health-care costs – something that hasn’t happened since 2002.

Every time the required cuts are about to kick in – with potentially disastrous financial effects on physicians and hospitals – Congress steps in to stop them. But that just pushes the crisis back another year, further enlarging the deficit.

J. James Rohack, president of the American Medical Association, told Health Care Finance News in November that because of the temporary fixes, “In four years, the cost of a permanent solution ballooned from $49 billion to more than $200 billion and cuts increased from under 5 percent to a whopping 21.2 percent.”

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