Panel: Fix SGR by Cutting Increased Medicare Payments for Hospital Services

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The National Commission on Physician Payment Reform, a panel of physicians and healthcare experts assembled by the Society of General Internal Medicine, made bold recommendations to fix Medicare's sustainable growth rate by saving money through ending the increased payments hospitals receive for outpatient services and incorporating quality metrics in all physician reimbursement within five years.

The panel also recommended the American Medical Association diversify the membership of its Relative Value Scale Update Committee, which advises Medicare on how to reimburse physicians, and make its decisions more transparent.

The panel argued Medicare doesn't need additional funding to come up with the $138 billion over the next decade needed to stop the sharp cuts to physicians from the SGR. Instead, it listed 12 recommendations to keep the program solvent while rewarding cost-effective and high-quality care practices. Among those recommendations:

•    Largely eliminate fee-for-service payments, and incorporate value- and quality-based payments over the next five years in testing sites, with broad adoption within the next 10 years.

•    All payors should increase annual updates for evaluation and management codes, which the panel called "currently undervalued," while freezing updates for most procedural diagnosis codes for the next three years.

•    End the practice of paying hospitals more for procedures that could be performed in lower-cost facilities.

•    Encourage practices with fewer than five physicians to form virtual relationships and share resources.

More Articles on Medicare Spending:

CMS: Hospital Readmissions Down to 17.8%
CMS Touts Lower Healthcare Spending, Readmissions Under PPACA
Specialty ACOs: The Next Step in Accountable Care

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