If I modify a patented idea by someone else, do I need to pay license feeds?

I agree with the previous comments in terms of determining with you are infringing a patent on a device or system/machine. However, if the competitor patent claims a process - method of doing something that involves multiple sequential steps - you have to look at it a bit differently. If you cut out steps or do them in a different order than the way the claims read, you may have a different invention.
The patent system was put in place to do just what you are doing - improving the status quo. However, the original innovator doesn't get squeezed out until his patent term expires. You'd feel the same, if the situation was reversed.