Senate approves bill that changes how Medicare pays doctors, ends annual 'doc fix'

Late Tuesday, the Senate cleared a bill that will change the way Medicare pays physicians, ending the annual Medicare "doc fix," and create a new system that rewards doctors whose patients become healthier. The House already approved the legislation last month.

The bill, which passed 92-8, is a "milestone for physicians, and for the seniors and people with disabilities who rely on Medicare for their health care needs," President Obama said. It replaces the system known as the Sustainable Growth Rate formula that was created in 1997. It was meant to keep Medicare spending in check by limiting annual increases in reimbursements for physicians, the Los Angeles Times reports, but every year, Congress had to override the mandated limits. By passing the bill on Tuesday, an automatic 21 percent cut in Medicare fees that was set to go into effect Wednesday has been stopped.

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