CBO just released a score of the Medicare legislation (HR 6331, with a proposed amendment) under consideration in the House. In total, CBO estimates that the bill would reduce deficits by $0.3 billion over the 2008-2013 period and by less than $50 million over the 2008-2018 period.
The five-year savings would decline to $0.1 billion if the pending supplemental appropriations act is cleared before H.R. 6331.
Honorable John D. Dingell
Chairman
Committee on Energy
and Commerce
U.S. House of Representatives
Washington, DC 20515
Dear Mr. Chairman:
The Congressional Budget Office has prepared the enclosed table (PDF) summarizing the budgetary effects of an amendment in the nature of a substitute to H.R. 6331, the Medicare Improvements for Patients and Providers Act of 2008. CBO estimates that enacting H.R. 6331 with that proposed amendment would reduce direct spending by $0.1 billion over the 2008-2013 period and increase direct spending by $0.3 billion over the 2008-2018 period. In addition, the Joint Committee on Taxation estimates that enacting the bill would increase federal revenues by $0.2 billion over the 2008-2013 period and by $0.4 billion over the 2008-2018 period. In total, CBO estimates that the bill would reduce deficits (or increase surpluses) by $0.3 billion over the 2008- 2013 period and by less than $50 million over the 2008-2018 period. (The five-year savings would decline to $0.1 billion if the pending supplemental appropriations act is cleared before H.R. 6331.)
The bill would cancel a reduction in Medicare’s physician fees scheduled to occur under current law on July 1, 2008. The bill would freeze those payments at their current levels for the remainder of the year and increase them by 1.1 percent in January 2009. Future payments beyond 2009 would revert to the levels under current law, necessitating a 21 percent reduction in payments under the physician fee schedule in 2010. The bill also would extend many expiring provisions in Medicare, expand Medicare’s coverage of preventive services, and modify the rules governing eligibility for the Medicare Savings Program.
New spending under the bill would be offset largely by reductions in payments to Medicare Advantage plans. The bill, with the proposed amendment, would phase out payments for indirect medical education made to plans and hospitals for Medicare Advantage enrollees, leaving in place the separate payments for indirect medical education made directly to teaching hospitals that treat Medicare Advantage enrollees. It also would require private fee-for-service plans to establish networks of providers, comparable to requirements for other Medicare Advantage plans, but with some exceptions, which CBO estimates would lead to decreases in enrollment and reduced outlays. Other savings would come from modifications to the Physician Assistance and Quality Initiative fund and changes to Medicare’s payments for home oxygen therapy.
In addition, the bill would delay a program of competitive bidding for durable medical equipment and reduce the Medicare payments for those items until the program is resumed.
The five-year savings would decline to $0.1 billion if the pending supplemental appropriations act is cleared before H.R. 6331.
Honorable John D. Dingell
Chairman
Committee on Energy
and Commerce
U.S. House of Representatives
Washington, DC 20515
Dear Mr. Chairman:
The Congressional Budget Office has prepared the enclosed table (PDF) summarizing the budgetary effects of an amendment in the nature of a substitute to H.R. 6331, the Medicare Improvements for Patients and Providers Act of 2008. CBO estimates that enacting H.R. 6331 with that proposed amendment would reduce direct spending by $0.1 billion over the 2008-2013 period and increase direct spending by $0.3 billion over the 2008-2018 period. In addition, the Joint Committee on Taxation estimates that enacting the bill would increase federal revenues by $0.2 billion over the 2008-2013 period and by $0.4 billion over the 2008-2018 period. In total, CBO estimates that the bill would reduce deficits (or increase surpluses) by $0.3 billion over the 2008- 2013 period and by less than $50 million over the 2008-2018 period. (The five-year savings would decline to $0.1 billion if the pending supplemental appropriations act is cleared before H.R. 6331.)
The bill would cancel a reduction in Medicare’s physician fees scheduled to occur under current law on July 1, 2008. The bill would freeze those payments at their current levels for the remainder of the year and increase them by 1.1 percent in January 2009. Future payments beyond 2009 would revert to the levels under current law, necessitating a 21 percent reduction in payments under the physician fee schedule in 2010. The bill also would extend many expiring provisions in Medicare, expand Medicare’s coverage of preventive services, and modify the rules governing eligibility for the Medicare Savings Program.
New spending under the bill would be offset largely by reductions in payments to Medicare Advantage plans. The bill, with the proposed amendment, would phase out payments for indirect medical education made to plans and hospitals for Medicare Advantage enrollees, leaving in place the separate payments for indirect medical education made directly to teaching hospitals that treat Medicare Advantage enrollees. It also would require private fee-for-service plans to establish networks of providers, comparable to requirements for other Medicare Advantage plans, but with some exceptions, which CBO estimates would lead to decreases in enrollment and reduced outlays. Other savings would come from modifications to the Physician Assistance and Quality Initiative fund and changes to Medicare’s payments for home oxygen therapy.
In addition, the bill would delay a program of competitive bidding for durable medical equipment and reduce the Medicare payments for those items until the program is resumed.
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