Of all the manifestations of Washington dysfunction, none is more absurd than the annual "doc fix." The origins of the problem lie in a 1997 attempt by Congress to rein in Medicare physician reimbursements. Lawmakers devised a "sustainable growth rate" that was supposed to link payments to doctors' costs and workload.
Alas, the growth rate perversely encouraged excessive tests and procedures; when it actually began to reduce physicians' pay rates significantly in 2003, medical lobbies got it temporarily repealed in what turned out to be the first of 16 doc fixes. The cumulative cost of these fixes now exceeds $150 billion, and the most recent one expires March 31.
The Medicare Payment Advisory Commission has proposed any number of ways to reform the payment system, but Congress has balked at a permanent doc fix because doing away with the current rules, however discredited, would force lawmakers to acknowledge a huge hole in the federal budget. Filling it would require either taxes or spending cuts; most past short-term "doc fixes" have been paid for with health-care trims.