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Apr 16, 5:37 PM EDT

Obama signs overhaul of how Medicare pays doctors


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WASHINGTON (AP) -- Ending years of last-minute fixes, President Barack Obama on Thursday signed legislation permanently changing how Medicare pays doctors, a rare bipartisan achievement by Democrats and Republicans.

The bill overhauls a 1997 law that aimed to slow Medicare's growth by limiting reimbursements to doctors. Instead, doctors threatened to leave the Medicare program, and that forced Congress repeatedly to block those reductions.

Obama signed the legislation Thursday in front of reporters and photographers, sitting alone and coatless in balmy spring weather on the patio of the White House Rose Garden. The Senate passed the bill two days ago; the House approved it in March.

Obama praised Republican House Speaker John Boehner and House Democratic Leader Nancy Pelosi for negotiating the legislation.

He said the new law helps Medicare by giving assurance to doctors about their payments.

"It also improves it because it starts encouraging payments based on quality, not the number of tests that are provided or the number of procedures that are applied but whether or not people actually start feeling better," Obama said. "It encourages us to continue to make the system better without denying service."

The bill blocked a 21 percent cut in Medicare payments that was due to take effect this month. It also revamps how physicians will be paid in the future, by providing financial incentives for physicians to bill Medicare patients for their overall care, not individual office visits.

Noting the unusual bipartisan nature of the bill, Obama said, "I hope this becomes a habit."

In Congress, Boehner praised Pelosi for "her indispensable leadership in helping tackle these challenging issues."

"It was achieved by working together to find common ground," Boehner said Thursday at a ceremonial appearance with Pelosi, who's more typically his legislative antagonist.

Obama said he planned to hold a reception for lawmakers next week to salute them for their work. He said he wanted to sing the bill promptly to avoid reduced reimbursements to doctors.

As the measure neared passage, the federal Centers for Medicare and Medicaid Services said that without action, it would start making payments at the lower rates on Wednesday.

But the agency said Thursday it was already making most payments at the new full rates, even ahead of the president's signature.

That's a different scenario than federal officials and lawmakers described earlier this week, when Senate and House leaders were fending off 11th-hour objections and shepherding the legislation to final congressional approval.

Congressional leaders warned lawmakers to act quickly to prevent those cuts from taking effect. The Centers process about 4 million claims daily - enough to potentially trigger a flood of complaints from doctors and Medicare's elderly beneficiaries that legislators wanted to avoid.

In a written statement to health care providers, the agency said only "a small volume of claims" are being processed at the lower levels. Those payments will later be reprocessed so providers receive their full fees, the agency said.

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