Obama Threatens to Veto SGR Bill Delaying PPACA Mandate

The White House has indicated President Barack Obama will veto legislation that would repeal Medicare's sustainable growth rate and delay the Patient Protection and Affordable Care Act's individual mandate.

The White House Office of Management and Budget issued a statement stating the Obama administration "strongly opposes" House passage of the SGR Repeal and Medicare Provider Payment Modernization Act of 2014 because of a Republican amendment delaying the individual mandate until 2019. The amendment would "increase health insurance premiums, decrease tax credits, increase the number of uninsured and shift costs to businesses, workers, and healthcare providers," according to the statement.

The amendment, which was added by Ways and Means Committee Chairman Dave Camp (R-Mich.), would increase the number of uninsured people in 2018 by about 13 million people, according to the Congressional Budget Office. This would mean fewer individuals would receive coverage under Medicaid and the Children's Health Insurance Program. Furthermore, fewer people would get coverage through the health insurance exchanges and receive federal subsidies to cover their premiums.

Overall, the CBO predicts the amendment would reduce federal spending by approximately $170 billion from 2014 to 2024, enough to cover the $138 billion, 10-year cost of repealing and replacing Medicare's physician payment formula. However, in 2018, premiums for health insurance policies in the individual market would increase by 10 to 20 percent relative to current law.

The mandate delay could stand in the way of Congress finally fixing the SGR. Every year since 2003, Congress has passed a short-term legislative patch to stave off double-digit Medicare pay cuts for physicians under the SGR. Physicians face a 24 percent Medicare pay cut on April 1 unless lawmakers either enact a permanent solution or another temporary patch.

The bill that now includes Mr. Camp's amendment would repeal the SGR and replace it with a payment system that incentivizes physicians to provide high-quality, low-cost care. The legislation combines proposals approved last year by the House Ways and Means Committee, House Energy and Commerce Committee and Senate Finance Committee.

More Articles on the SGR:
Oncology Society Urges Congress to Fix Medicare SGR, End Sequestration
4 Key Statistics on Medicare's SGR
CIOs, the SGR and a New Direction for Health IT

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