House, Senate Leaders Introduce Medicare SGR Replacement Bill

House and Senate leaders have introduced a bipartisan bill that would repeal Medicare's sustainable growth rate and replace it with a payment system that incentivizes physicians to provide high-quality, low-cost care.

moneyThe proposal would repeal the SGR and ensure annual physician payment updates of 0.5 percent for five years. It would reform the fee-for-service reimbursement system to reward providers who meet performance thresholds, improve payment accuracy for individual provider services and incentivize care coordination. It would also introduce physician-developed clinical care guidelines and requires the development of quality measures.

Additionally, the bill would incentivize physicians to move to alternative payment models by providing a 5 percent bonus to those who receive a significant amount of revenue (25 percent in 2018 and 2019) from an alternative model or patient-centered medical home. A Technical Advisory Committee would review and recommend physician-developed alternative models created through an open comment process. The proposal would also make Medicare more transparent by making quality and utilization data public and would allow qualified entities to supply physicians with analyses and data for the purposes of care improvement.

The legislation was introduced by House Ways and Means Committee Chairman Dave Camp (R-Mich.), Senate Finance Committee Chairman Max Baucus (D-Mont.), Senate Finance Committee Ranking Member Orrin Hatch (R-Utah), House Ways and Means Committee Ranking Member Sander Levin (D-Mich.), House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and House Energy and Commerce Committee Ranking Member Henry A. Waxman (D-Calif.). It combines proposals passed by all of the committees. 

Members of the House and Senate have been working to find a permanent solution to the SGR. Every year since 2003, Congress has enacted a short-term legislative patch to delay the SGR cuts, a practice MedPAC said has provoked uncertainty and anger among providers and anxiety among beneficiaries. The latest patch — passed as part of the Bipartisan Budget Act of 2013 — delayed a required 24 percent Medicare pay cut and provided a 0.5 percent payment update for physicians through March.  

More Articles on Medicare's SGR:
CBO: House SGR Bill Would Cost $121.1B
The $150 Billion Question: How to Pay for a Permanent SGR Repeal
5 Key Facts About the Medicare SGR 

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