Physician Payment 2008 for Interventionalists:
Current State of Health Care Policy
Authors: Manchikanti Laxmaiah 
Published: March 2021

Physicians in the United States have been affected by significant changes in the pattern(s) of
medical practice evolving over the last several decades. These changes include new measures
to 1) curb increasing costs, 2) increase access to patient care, 3) improve quality of healthcare,
and 4) pay for prescription drugs. Escalating healthcare costs have focused concerns about the
financial solvency of Medicare and this in turn has fostered a renewed interest in the economic
basis of interventional pain management practices. The provision and systemization of healthcare in North America and several European countries are difficult enterprises to manage irrespective of whether these provisions and systems are privatized (as in the United States) or
nationalized or semi-nationalized (as in Great Britain, Canada, Australia and France). Consequently, while many management options have been put forth, none seem to be optimally
geared toward affording healthcare as a maximized individual and social good, and none have
been completely enacted.
The current physician fee schedule (released on July 12, 2007) includes a 9.9% cut in payment
rate. Since the Medicare program was created in 1965, several methods have been used to
determine physicians’ rate(s) for each covered service. The sustained growth rate (SGR) system, established in 1998, has evoked negative consequences on physician payment(s). Based
on the current Medicare expenditure index, practice expenses are projected to increase by
34.5% from 2002 to 2016, whereas, if actual practice inflation is considered, this increase
will be 90%. This is in contrast to projected physician payment cuts that are depicted to be
51%. No doubt, this scenario will be devastating to many practices and the US medical community at large.
Resolutions to this problem have been offered by MedPAC, the Government Accountability
Office, physician organizations, economists, and various other interested groups. In the past,
temporary measures have been proposed (and sometimes implemented) to eliminate physician payment cuts. At present, the US Senate and House of Representatives are separately
working on 2 different mechanisms to address and rectify these cost-payment discrepancies.
The effects of both the problem and the potential solutions on interventional pain management may be somewhat greater than those on other specialties. Physician payments in interventional pain management may evidence cuts of 10% to 15%, whereas if procedures are
performed in an office setting, such cuts may range from 29% to 39% over the period of
the next 3 years if the proposed 9.9% cut is not reversed. Medicare cuts also impact other insurance payments, incurring a “ripple effect” such that many insurers will seek to pay at or
around the Medicare rate.
In this manuscript, we discuss universal healthcare systems, the CMS proposed ruling and its
attendant ripple effect(s), historical aspects of the Medicare payment system, the Sustained
Growth Rate system, and the potential consequences incurred by both proposed cuts and potential solutions to the discrepant cost-payment issue(s). As well, ethical issues of policy development upon the infrastructure and practice of interventional pain management are addressed.
Key words: Health policy, physician payment policy, physician fee schedule, Medicare, sustained growth rate formula, interventional pain management, regulatory reform, ethics