Physician-Payment Reform — Unfinished Business

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Abstract
WITH the final implementation of the Medicare fee schedule in January of this year, the renegotiation of a political bargain first struck more than 25 years ago was successfully concluded. To secure a reluctant profession's cooperation with Medicare, Congress promised in 1965 that it would refrain from exercising "any supervision or control over the practice of medicine or the manner in which medical services are provided, or over the selection, tenure or compensation of any officer or employee of any institution, agency or person providing health services."1 During the past decade, this laissez-faire posture proved economically untenable. It was abandoned conclusively when, with the profession's support, Congress passed the Omnibus Reconciliation Act of 1989,2 which put in place the framework of the recently implemented physician-payment reform.

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