There’s finally some good news for physicians who provide care to Medicare patients. On Nov. 21, 2011, President Obama signed H.R. 674, legislation that prevents a 3 percent tax withholding for many Medicare payments.
This statute, originally passed in 2006 but delayed several times, called for the Internal Revenue Service (IRS) to require Medicare contractors to withhold 3 percent of Medicare payments to physicians and other health care providers until the following tax year in an effort to increase tax compliance. By signing this bill, the 3 percent withholding provision on government contractors has been permanently repealed.
The American Medical Association (AMA) worked closely with the Government Withholding Relief Coalition to strongly advocate for the legislation.
“The AMA applauds Congress for passing this important piece of legislation that removes the 3 percent withholding provision that would have burdened physicians who care for Medicare patients,” said AMA president Peter Carmel, MD.
“This is an important step forward, but more work still needs to be done on Medicare. Physicians who care for Medicare patients face a drastic 27 percent cut on Jan. 1 due to the broken Medicare physician payment formula. The time is now for Congress to fix this formula. Physicians and their Medicare patients deserve better.”
Take action now and tell Congress to repeal Medicare’s flawed payment formula.