Senate approves delay in Medicare payment cuts
The U.S. Senate Tuesday, by a 78-19 vote, passed the $10 billion Temporary Extension Act of 2010, which includes a provision that delays a 21.2 percent Medicare payment reduction to physicians until the end of March. The House of Representatives passed the legislation last week.

The Senate bill had been held up by Sen. Jim Bunning, R-Ky., who opposed it because it will not be offset by budget cuts. According to published reports, the measure finally got to the Senate floor when the Senate leadership allowed a vote on a Bunning amendment that would have offset the money needed to pay for the extension act by ending a tax credit for paper companies. That amendment failed.

Those Medicare cuts—mandated under the sustainable growth rate (SGR) formula—technically went into effect on March 1, but the Centers for Medicare and Medicaid Services (CMS) stalled the impact of those cuts by instructing that claims be held until March 12 with the assumption that the Senate would act to forestall the cuts.

Now the Senate is expected to vote on a much larger package—the American Workers, State and Business Relief Act—sponsored by Max Baucus, D-Mont. and Senate Majority Leader Harry Reid, D-Nev. This bill would extend a number of government benefits and tax breaks and includes a provision that would delay the Medicare payment reduction for seven months.

The total piece of legislation will cost $150 billion, while the provision containing the seven-month extension on physician Medicare payments costs $7.3 billion.

The bill also extends increased federal assistance for state Medicaid programs, made available through the American Recovery and Reinvestment Act, for six months. According to Baucus and Reid, without this additional federal support many states would be unable to fund their Medicaid program, which would result in more families losing healthcare coverage.