A fix at last? SGR repeal bill advances in Congress

Sunday, September 01, 2013 12:22 PM

Kate Alfano, CMS contributing writer

Congress is getting closer to repealing the highly criticized Medicare sustainable growth rate formula (SGR) that places a global cap on Medicare spending on provider services and has subjected physicians to an annual guessing game as to whether their payments would be cut by an ever-growing margin. HR 2810, the “Medicare Patient Access and Quality Improvement Act,” would replace the SGR with a fair and stable system of payments starting in 2014. The legislation is sponsored by U.S. Rep. Michael Burgess, MD, of Texas, a physician specializing in obstetrics-gynecology.

The draft legislation was released in July. Instead of facing annual cuts, physicians would receive an annual update of 0.5 percent for the next five years. Starting in 2019, physicians practicing under fee-for-service would receive an additional adjustment based on quality performance under a new Quality Update Incentive Program (QUIP).

Performance under QUIP would be assessed based on quality measures and clinical practice improvement activities, and physicians would be assessed based on their performance among peers who provide like services. High-performing physicians would have an opportunity to earn a 1 percent bonus based on previous performance, while low-performing physicians would receive a 1 percent reduction in payments. Scheduled penalties under current law would remain in effect, such as those specified under the Physician Quality Reporting System and Electronic Health Record Incentive Program.

The legislation also includes transparency and collaboration requirements to solicit input from medical organizations and other groups on the development and selection of quality measures, and provides additional avenues for the development of new payment and care delivery models.

HR 2810 was considered and approved by the Health Subcommittee of the U.S. House Energy and Commerce Committee, then considered and approved by the full Energy and Commerce Committee just before the five-week congressional recess began on Aug. 1. However, because the committee did not propose a solution for paying for the SGR repeal, the legislation will not be sent to the full House for consideration until lawmakers find the necessary offsets in the budget. The Congressional Budget Office estimates the cost of the SGR repeal to be around $200 billion.

Ardis Hoven, MD, president of the American Medical Association, praised congressional leaders for their work to fix the Medicare physician payment system this year but also said that there is still work to be done to ensure a strong future for Medicare. “When crafting new payment systems, lawmakers must ensure that funding for Medicare’s payments to physicians is sufficient to allow for sustainable practice environments that give physicians the ability to invest in new ways of improving care for patients.

“This includes maintaining budget neutrality related to adjustments to correct misvalued codes as part of that ongoing process. Changes to quality reporting requirements should build on the existing system rather than attempting to implement a new regimen that adds administrative burdens and could distract from more effective efforts to improve patient care.”

Congress has acted many times – sometimes multiple times in a year – over the past decade to stop steep reductions from taking place under the SGR. Should they fail to act this year, a nearly 25 percent reduction in Medicare physician payments would take effect Jan. 1, 2014.

How you can help repeal the SGR

Colorado physicians can help move HR 2810 along by urging your senators and representatives to stay committed to repealing the Medicare SGR formula and passing legislation to enact Medicare physician payment reform. The American Medical Association provides many resources and tools for physicians to stay up to date on the issue and reach out to your elected officials.

Go to the AMA’s Grassroots Advocacy webpage, http://ow.ly/ogVsW, to view tools and guides you can use including the congressional recess “Action Kit,” a new grassroots smartphone app, the AMA Guide to Communicating with Congress, and more.

Go to the AMA Legislative Action Center webpage, http://ow.ly/ogVDV, to send an e-mail or printed letter with the click of your mouse, or call the AMA’s Physicians Grassroots Network hotline at (800) 833-6354.

Congress must finally act this year to repeal the SGR and physicians must have the opportunity to lead in the development of quality metrics and alternative payment and delivery models. Get involved today.