MedPAC Issues Savings Proposals for Potential Repeal of SGR

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The Medicare Payment Advisory Commission released a draft offset list of savings proposals if the sustainable growth rate were repealed, according to a MedPAC transcript (pdf).

The SGR is used to determine physician payments under Medicare, and if no action is taken toward repeal or reform of the SGR, Medicare payment rates for physicians will fall by 29.4 percent starting Jan. 1, 2012. If Congress does reform or repeal the SGR, it would increase Medicare spending on physician services by roughly $300 billion between 2012 and 2021.

MedPAC divided savings proposals into two tiers. Tier I contains previous recommendations and is estimated to save about $50 billion. Tier II contains proposals from outside groups such as the Officer of Inspector General and the Congressional Budget Office and is estimated to save about $180 billion.

Recommendations include the following:

•    Hospital inpatient prospective payment system update of 1 percent in FY 2012.
•    Bundled payment for hospitals and physicians during the admission.
•    Pay emergency and management visits in hospital outpatient departments at physician fee schedule rates.

Related Articles on Sustainable Growth Rate:

AMA: Deficit Reduction Must Include Repeal of Sustainable Growth Rate
MedPAC Considers Repeal of Sustainable Growth Rate
Report: Potential Reform of Sustainable Growth Rate to Have Huge Implications

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