In his optimistic State of the Union assessment of health care challenges, President Obama failed to mention one dire prospect: the 24-percent pay cut Medicare physicians will face March 31 if Congress doesn’t act.  The sharp decrease in reimbursement is set to be imposed by a complicated formula called the Sustainable Growth Rate (SGR) as part of a decades-long effort to control Medicare’s exploding costs.

“The SGR formula hasn’t worked, and Congress has stalled its implementation since 2003 with short-term ‘doc fixes’ that are expensive to taxpayers and don’t solve the problem,” Robert Moffit, the senior Medicare expert at The Heritage Foundation, told The Foundry. “Lawmakers need to junk this old-school approach of paying for physician services through tighter Medicare price controls, manipulating administrative payments, or essentially shifting costs from one part of the Medicare program to another.”

Already under Obamacare, Moffit noted, Medicare doctors face $716 billion in payment cuts over 10 years, which Medicare accountants admit would jeopardize seniors’ access to care.

“Congress has the opportunity to act and make structural reforms that offset a complete repeal of the SGR formula,” said Moffit, senior fellow in Heritage’s Center for Health Policy Studies. “Some of the best bipartisan options include combining Medicare’s Part A, composed of hospital payments, with Part B, composed of physician payments, into one uniform deductible.”

The idea is to allow more protections for America’s seniors than they currently have in Medicare, while making the program financially sustainable for taxpayers and future generations.

This story was produced by The Foundry’s news team. Nothing here should be construed as necessarily reflecting the views of The Heritage Foundation.