Report: Potential Reform of Sustainable Growth Rate to Have Huge Implications

Reform of the sustainable growth rate provision of the Balanced Budget Act of 1997 must be considered during the upcoming deficit reduction talks and could factor into the appraisal of the nation's creditworthiness, according to a MedeAnalytics report.

Putting off reform of the SGR could result in significant decreases to Medicare physician fees in the 2012 calendar year, the report said. There are three possible scenarios that could emerge from the congressional handling of the SGR in the Budget Control Act:

1. Do nothing. If Congress is unable to reach a deal, a 29.5 percent reduction in Medicare physician fees would take effect on Jan. 1, 2012.

2. Carry out another temporary fix. Another temporary fix or addendum could increase the cost of a permanent fix that will have to be reached at some point.

3. Reform or replace. If Congress reforms or repeals the SGR, it would increase Medicare spending on physician services by roughly $300 billion between 2012 and 2021, which would result in cuts to other parts of Medicare, Medicaid and other non-healthcare sectors.

Related Articles on the Budget Control Act:

Automatic Cuts From Debt Committee's Failure Put 194k Healthcare Jobs on the Line
Kaiser Family Foundation Outlines Budget Control Act, Medicare
6 Ways Hospitals Can Survive the Onslaught of Medicare Cuts

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