The SGR Issue: What Another Temporary Patch Means for Physicians

Earlier this month, President Barack Obama signed legislation that delayed ICD-10, shaking up the healthcare industry as providers, payers and other stakeholders reconsidered their preparation plans.

However, pushing back the switch to ICD-10 wasn't the only notable provision in the new law. The measure also represents yet another short-term legislative patch enacted to stave off steep pay cuts for physicians under Medicare's sustainable growth rate. Every year since 2003, Congress has passed short-term legislative patches to bypass double-digit Medicare pay cuts under the SGR. The latest patch protects physicians until the end of March 2015 from a 24 percent reimbursement reduction.

moneyPeter B. Angood, MD, CEO of the American College of Physician Executives, says the passage of another temporary solution instead of a permanent one is "disappointing" for his organization, although they are "respectful that process is required in order to get to the best overall outcome without feeling rushed."

Earlier this year, however, it looked as if a permanent solution might have been within reach. In January, House and Senate leaders introduced a bipartisan bill that would have repealed the SGR and replaced it with a payment system that incentivizes physicians to provide high-quality, low-cost care. The legislation combined proposals approved last year by the House Ways and Means Committee, House Energy and Commerce Committee and Senate Finance Committee.

The House passed the bill. However, Ways and Means Committee Chairman Dave Camp (R-Mich.) tacked on an amendment that would delay the Patient Protection and Affordable Care Act's individual mandate by five years. Because of the amendment, the White House issued a statement indicating that President Obama would veto the legislation if it reached his desk. But it hasn't come to that, since the bill has not managed to clear the Senate.

The American Medical Association opposed the addition of the amendment, urging Congress not to let  partisan conflict over the PPACA stand in the way of fixing Medicare's physician payment formula. The ACPE also released a survey showing nearly 81 percent of physician leaders disapproved of tying the SGR fix to an individual mandate delay.

Dr. Angood says the ACPE supported the original bipartisan solution. "We actually thought that was a reasonable proposal," he says. "Almost any bill or legislation that gets passed on this set of issues will need to be revised…but it would be great to have something in place to at least get started."

Policymakers need to keep trying to find a "strong compromise" that works for both parties, so that the physician workforce will be able to stop worrying about looming SGR cuts and "get back to the work of providing patient care with reasonable reimbursement," according to Dr. Angood.

"Physicians are like any other type of workforce," he says. "When there are issues related to compensation and income, then that becomes a focus of attention. The physician workforce would prefer to get back to work."

The Medicare Payment Advisory Commission also views the SGR as disruptive; MedPAC has informed Congress the payment formula is "fundamentally flawed and is creating instability in the Medicare program for providers and beneficiaries."

Still, Dr. Angood doesn't foresee a permanent solution in the near future, especially with congressional and presidential election cycles on the horizon and ongoing PPACA implementation.

"That will create some uncertainty in the environment overall, politically," he says. "Now we have change in the leadership in Health and Human Services. The likelihood of something effectively being passed is declining [and] not improving. Having said that…overall, the physician workforce would certainly want something passed sooner rather than later."

More Articles on the SGR:
Obama Signs SGR Patch, Delay of Two-Midnight Rule Into Law
AMA Opposes Temporary SGR Patch
Poll: Most Physician Leaders Don't Support Linking SGR Repeal, Individual Mandate Delay

 

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