SGR Repeal Bill Good, Could Be Better, Must Pass

A bipartisan plan to repeal the Medicare Sustainable Growth Rate (SGR) formula is a good start but still needs work, the Texas Medical Association and eight other states in the Coalition of State Medical Societies say in a letter to the chairs and ranking members of the Senate Finance Committee and House Ways and Means Committee.

"Another patch, another 'doc fix,' is not acceptable," the coalition added in a follow-up memo to Congress.

TMA physician leaders and physicians from other coalition-member states spent several days in November meeting with senators and representatives from both parties, stressing mostly Medicare payment reform. 

The Centers for Medicare & Medicaid Services released its final rule with the 2014 Medicare physician payment schedule on Nov. 27. It also posted a fact sheet on the rule. Unless Congress repeals the SGR or takes some other action by Jan. 1, Medicare payments to physicians will be cut by about 24 percent.  

The coalition, which represents 158,500 physicians and medical students in Texas, Arizona, California, Florida, Louisiana, Oklahoma, New York, North Carolina, and South Carolina, said in the letter that it supports five components of proposed legislation to "establish new payment systems that will help physicians keep their doors open to baby boomers and future Medicare patients":  

  • Repeal the flawed Medicare SGR formula. 
  • Retain a fee-for-service program. 
  • Streamline current reporting programs and eliminate the current penalties related to the Physician Quality Reporting System, meaningful use, and the value-based modifier (VMB). 
  • Pay for complex chronic care management, and 
  • Provide timely performance feedback for physicians. 

However, the letter says, "to protect access to care for millions of Medicare patients and to ensure the sustainability of America's health care system, these critical improvements must be made to the current House-Senate proposal":  

  • Provide appropriate annual updates to sustain physician practices.  
  • Put the costly, clinically irrelevant ICD-10 on permanent hold until ICD-11 or another usable replacement for ICD-9 is ready for widespread implementation.
  • Reduce the regulatory burden imposed on physician practices. 
  • Allow options, extended timelines, assistance, and financial aid for any small physician practice that wishes to transition to new payment models, not only for those in certain locations.  
  • Instead of making incentive payments available only to specific physician practices or specific geographic areas, allow incentive payments for a variety of alternative payment models, including ones that DO NOT require physicians to assume full financial risk. 
  • Evaluate the cost-effectiveness of all reporting and incentive programs to determine whether they improve care, reduce total cost, or selectively penalize physicians who serve specific demographic or cultural groups.   
  • Before implementing any of the existing VBM measures and methods in a new value-based payment program, revise them so that:
  1. The measures and standards used do not result in financial penalties for physicians when their patients do not comply with recommendations for testing and treatment;  
  2. Physicians are not penalized for providing services to disadvantaged patients;  
  3. Physicians are not penalized for noncompliance with obsolete or superseded guidelines and standards; and  
  4. Both cost and quality measures are adequately risk-adjusted to eliminate the effects of poverty, poor educational attainment, and cultural differences.

The letter also suggests ways the government can reduce the administrative and financial burden on physicians in Medicare. They include creating a "de minimis amount exception for the duty to return overpayments under threat of the False Claims Act as well as for recovery audits," reversing the requirement that an ordering physician be enrolled in Medicare for the referred physician to be paid for his or her services, and allowing payment for telephone or email consultations after a face-to-face encounter.  

In its follow-up memo, the coalition called on lawmakers to "take immediate action to work together" to repeal the SGR and not opt for another temporary fee freeze or small increase as it has done for several years.

The coalition's message reminded lawmakers that the "track record for Congress is not very good. For 12 years, physicians have toiled under the SGR, which everyone knows is broken. Physician practices have been subject to short-term patches each year, crippling their ability to plan for the future, even making them wonder if they'll be solvent for the current year. The decision to further delay only exacerbates the fiscal albatross around the necks of America's physicians and the Medicare patients we serve. The vast majority of you say the SGR needs to be permanently fixed. Let’s do it. Now is the time for action."

The Senate Finance Committee has scheduled a Dec. 12 "open executive session" on the draft SGR repeal proposal.

Action, Dec. 4, 2013

Last Updated On

January 13, 2014

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