Congress stepped in at the last minute and stopped a proposed 5.1% Medicare reimbursement cut before the January 1, 2007 deadline.

The proposed 2007 fee schedule is based on a flawed payment formula that dates back to legislation passed in 1997, according to the AOA. This 10-year-old law created a payment formula that ties Medicare reimbursement rates to the nations sustainable growth rate (SGR). While costs for practices have continued to escalate, the Medicare payments have not increased since 2001.

The AOA Washington office and optometrists from across the country worked with members of Congress and other physician groups to halt the SGR Medicare payment cuts just before Congress adjourned, says optometrist Michele Haranin, chair of the AOA Federal Relations Committee. Passage of the Tax Relief and Health Care Act of 2006 freezes the current fee schedule at the 2006 rate, though the 3% to 5% reductions not related to the SGR will still take effect. It also includes a quality reporting system that will offer bonuses to physicians who elect to participate. The AOA is following the requirements for the quality reporting, Dr. Haranin says, and will keep the optometric community informed.

The 3% to 5% reductions are based on the results of a five-year review of Relative Value Units (RVUs) for eye care codes. The review recommended up to a 5% decrease in reimbursement rates for optometrists.