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Congress Attempts to Fix Medicare: Winners and Losers

By Michael Douglass and Dave Williamson - Mar 30, 2014 at 8:00AM

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Doctors decry: the fix is in.

Medicare has been in the news lately, as Congress is embroiled in another fight over the so-called "Doc Fix," which would temporarily repeal the Medicare Sustainable Growth Rate, or SGR. The SGR dates from 1997, and attempts to control health care spending by tying Medicare reimbursement increases to economic growth. The SGR is very unpopular with physicians, as it reduces their Medicare reimbursements, and Congress has passed a patch overriding those cuts every year since 2003. If these cuts are not overriden this year, they would result in a 24% reduction in Medicare reimbursements for doctors this year.

The House of Representatives has passed a one-year patch to remove that cut, and on Monday the Senate will vote on the bill. Although the bill would help doctors avoid a significant pay cut, physician groups like the American Medical Association have come out against this Medicare fix.

In this segment from Thursday's Market Checkup, Motley Fool health care analysts David Williamson and Michael Douglass discuss how the doc fix affects your investments and the stock winners and losers in this latest Medicare battle.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

Tenet Healthcare Corp. Stock Quote
Tenet Healthcare Corp.
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$72.87 (-2.13%) $-1.59
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$12.03 (-4.45%) $0.56
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