Physician pay cut uncertainty could crash Medicare computer system, official warns

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The Centers for Medicare & Medicaid Services has warned that its computer systems could crash due to a backlog of claims unless Congress acts to prevent a scheduled 27.4% physician pay cut.

Earlier this week, CMS instructed physician claims contractors to hold physician claims for the first 10 days of 2012 while Congress grappled with passing the payroll tax cut extension, a bill that contained a short-term solution for preventing a Medicare physician pay cut. This solution is known as the “doc fix.” Despite indications by House leadership Tuesday that a standalone doc fix bill could be in the works, a spokesman for Speaker of the House John Boehner (R-OH) told Bloomberg News that House Republicans will not move forward with such a plan.

This uncertainty has led CMS to caution against holding physician claims longer than 10 days. Jonathan Blum, Medicare's deputy administrator, told the Associated Press that lawmakers might be surprised to learn about CMS' computer struggles because a similar showdown in 2010 resulted in Medicare successfully holding payments for 20 days.

“We feel that (Medicare) came very close operationally to crashing our system back in 2010,” Blum told the AP. “From a stewardship perspective, that is something we feel we can never repeat again.”

Bloom added that CMS has told contractors to start paying claims for 2012 at the lower rate on Jan. 18, as lower cash flow is preferable to zero cash flow.