Senate approves bill to stave off rate cut for Medicare docs

NEW YORK (CNNMoney.com) -- The Senate approved a bipartisan bill Wednesday that would prevent a 25% cut in doctors' Medicare reimbursement rates in 2011.

The bill, which would cost $19.3 billion over 10 years, would be paid for by changing a provision of the health reform act that provides tax credits for people who buy coverage. The credit is scaled to a person's income. The legislation would increase the amount people would have to repay if they underestimate their earnings.

In a rare act of unanimity, the bill was sponsored by Senate Majority Leader Harry Reid of Nevada, Minority Leader Mitch McConnell of Kentucky, Finance Committee Chair Max Baucus of Montana, and Chuck Grassley of Iowa, the ranking Republican on the committee.

It now moves to the House, which supported previous efforts to keep pay levels intact for Medicare doctors.

A 1997 law requires that doctors' Medicare rates be adjusted each year based on the health of the economy, with the goal of keeping the program in the black. Rate cuts have been blocked 10 times in the last eight years, including five times this year.

Doctors have been heavily lobbying lawmakers to prevent the scheduled cut from taking effect next year.

The American Medical Association had said that if the cut were enacted, some doctors would have had to stop accepting Medicare patients. Some 43 million people, mostly senior citizens, receive Medicare benefits.

"Stopping the cut for one year will inject some much needed stability into the system for seniors and physician practices who have spent this year in limbo because of five short-term delays," said Dr. Cecil Wilson, the association's president.