An SGR Fix for Medicare Could Arrive Before 2014

November 4, 2013 | By More

Sustainable growth-rate (SGR) formula for Medicare reimbursementsSenate and House committees are working on changes that would scrap the sustainable growth-rate (SGR) formula for Medicare reimbursements.

Just when you thought that Congress would kick the SGR problem down the road – again – into 2014, it appears that a bipartisan resolution might be in the works.  Everyone agrees the SGR mechanism is fundamentally broken, and has been since its inception more than a decade ago.  Without a fix, or another delay, physician payments for Medicare patients would be cut 24% as of January First.

A discussion draft circulating on Capitol Hill calls for the permanent repeal of the SGR.  Congress would reform the fee-for-service payment system through greater focus on value over volume and encourage physician participation in alternative payment models.  Current payment levels would be frozen for ten years, allowing healthcare providers “to earn performance-based incentive payments through a compulsory budget-neutral program.”  Beyond 2023, those participating in an advanced alternative payment model would receive annual updates of two percent, while others would get one-percent.

Doctors and other healthcare professionals who receive a significant portion of their revenue from an alternative payment model that involves two-sided financial risk and a quality measurement component would be exempted from the performance-based incentive program, and would instead receive a  bonus payment starting in 2016.

There would be new payment codes for care management services involving individuals with complex chronic care needs.  Both the Senate Finance and House Ways and Means Committees are soliciting public comments on the proposal.

The fact that physicians have been waiting for something like this for ten years makes for some optimism.  There is one issue that must be resolved: how does the federal government pay for it.  The “pay-for” may be dumped on a number of healthcare industry groups who wield a lot of power.

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Category: Legal Issues

About the Author ()

Roger Downey is currently the Communications Manager for GlobalMed, a Scottsdale, Arizona-based telemedicine design, manufacturing and marketing firm. He is a broadcast news veteran, having worked as a News Anchor/Reporter for KPHO-TV, the CBS affiliate in Phoenix, for 25 years. In 2004, he became the Media Relations Officer for the Arizona Medical Board, the regulatory agency for MDs in the state. In the spring of 2010 he transitioned to his current position. Roger is a Board Member of the Arizona Partnership Implementing Patient Safety (APIPS), a 501(c)3 non-profit organization composed of physicians, nurses, hospital and government agency representatives, pharmacists, and insurance carriers. He is also a member of the American Telemedicine Association Pediatric Special Interest Group. He is a member of the Silver Circle of the Rocky Mountain Chapter of the National Academy of Television Arts and Sciences for his 25 years in television.

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