Congress considers SGR change that may avert Medicare fee cuts

Policymakers made significant strides toward replacing the sustainable growth rate (SGR) payment mechanism — which could avert the looming cut to what Medicare pays doctors.

The current payment patch within the bipartisan budget deal would, in fact, delay a 24 percent cut in Medicare physician reimbursement rates, if approved.

“The time has come for the temporary patches and trend of uncertainty to end. Now Congress must move a permanent repeal of the SGR physician payment formula, which will bring security to providers and the millions of seniors who rely on Medicare for their healthcare,” House Ways and Means Committee Chairman Dave Camp said in his opening statement for the markup of H.R. 2810.

On Dec. 12 the House Ways and Means Committee unanimously passed H.R. 2810 to repeal the formula altogether, and the Senate Finance Committee followed suit on a similar measure later the same day.

What’s more, the House Rules Committee added a temporary “doc fix” to the bipartisan budget deal — announced Dec. 10 by Rep. Paul Ryan (R-Wis.) and Sen. Patty Murray (D-Wa.), and pushed through by the House on Thursday — as a means to ward off physician payment cuts until at least the end of March. Lawmakers and industry mainstays, meanwhile, are lauding the Senate Finance and House Ways and Means committees’ work as proof of a united interest in more permanent SGR fixes.

"Today's strong, bipartisan votes by the Senate Finance and House Ways and Means committees, following similar action last July by the House Energy and Commerce Committee, shows that there is overwhelming, bipartisan support for ending SGR in a fiscally responsible manner and closing the book on the annual cycle of draconian Medicare physician payment cuts and short-term patches,” American Medical Association President Ardis Dee Hoven, MD, added in a prepared statement.

The decisions also come in the wake of the Congressional Budget Office’s announcement on Dec. 6 that the estimated cost for a permanent fix to the current, oft-considered “flawed” SGR is cheaper than anticipated, ringing in at an estimated 10-year cost of $116.5 billion instead of the $139.1 billion quoted in February. For those desiring the complete repeal of the SGR formula, the odds seem to be in their favor.

In his opening remarks regarding the bill put before the Senate Finance Committee, Senator Orrin Hatch (R-Utah) assured lawmakers that an entire SGR repeal would absolutely be affordable: “Let me say it in no uncertain terms: This bill will be offset. Period.”

Considering that since 2003, fifteen SGR patches have been implemented to the tune of $150 billion, according to Hatch, a less expensive, more permanent overhaul seems reasonable to balance out such past efforts.

Explore the bill approved by the Senate Finance Committee here and the bill approved by the House Ways and Means Committee here.