State could lose millions in Medicare payments

Posted: Thursday, October 17, 2002

ANCHORAGE - Alaska stands to lose $10 million in Medicare payments to physicians by 2005 unless Congress intervenes, according to the American Medical Association.

Jim Jordan, executive director for the Alaska State Medical Association, said Tuesday such a loss would threaten access to health care for the elderly.

Today, the over-65 population is the fastest growing sector in Alaska, according to the state Department of Labor. Many are Medicare patients struggling to find a primary care doctor.

More than 1,000 elderly Alaskans lost their regular physicians this year because of a doctor's office dissolving, doctors moving away or a change in military health care programs. Elderly patients have told local doctors that they must call a dozen or more physicians before finding one that accepts new Medicare patients.

"Physicians want to serve seniors, but they simply cannot afford to accept an unlimited number of Medicare patients into their practices while facing continued payment cuts," Dr. Yank Coble Jr., AMA president, told the Anchorage Daily News.

Medicare is a federally funded health insurance program for people 65 and older. The AMA says funding has decreased because the government made errors when creating the Medicare payment formula. The formula now delivers less money.

This year, physicians and other health care providers lost 5.4 percent in Medicare payments. They face another 12 percent reduction during the next three years, the AMA said.

The medical association is urging Congress to take action before the next round of Medicare payment reductions is announced Nov. 1.

The lower payments make it difficult for Alaska doctors to do business, said Dr. Jeanne Bonar, Anchorage endocrinologist and president of the Alaska State Medical Association.

Her office charges $103 for a patient with multiple health problems requiring a lengthy visit. Medicare allows her to charge about $56, but only pays 80 percent of the allowable fee. The patient or a secondary insurance plan can cover the remaining 20 percent. That means Medicare pays only 43 percent of the total bill, but Bonar said she needs to recoup at least 60 percent to cover overhead costs, including salaries and rent.

The AMA's statistics show how each state stands to lose Medicare money between 2003 and 2005. The AMA calculated its numbers by analyzing data from the federal Centers for Medicare and Medicaid Services.

Alaska's $10 million loss would be among the lowest nationwide. Washington state's potential loss is $162 million, California's is $967 million, and Florida's is more than $1 billion.

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