The Medicare Payment Advisory Commission (MedPAC) is considering a proposal to address the sustainable growth rate (SGR) used to determine physician Medicare reimbursement fees. At a meeting this morning, MedPAC discussed a possible repeal of the SGR using a broad range of budget offsets.

The proposal calls for a freeze for primary care and a 5.9 percent cut for all of the other specialties for each of the next three years, followed by a seven year freeze. The plan is currently under discussion by the Commission but will not be voted on until the October 6-7, 2011, meeting.

The NCMS is closely monitoring this latest development, as is the AMA, which says it will make it that much more difficult to convince Congress to adopt a plan being advocated by organized medicine.

“The misguided scheme discussed by MedPAC to replace the nearly 30 percent cut to physicians scheduled for January 1, 2012, with a new series of very significant cuts will harm patients and physicians in the Medicare program,” said AMA President Peter Carmel, MD. “The new cuts are inconsistent with MedPAC’s previous recommendations to stop cuts to physicians who care for Medicare patients because they threaten access to care for patients and would have severe consequences for the Medicare system.”

Dr. Carmel says Medicare payment updates since 2001 have not kept up with the cost of running a medical practice, leaving a 20 percent gap between reimbursement rates and practice expenses.  He notes that further drastic cuts could pose a risk to a physician’s ability to retain staff and make investments needed to modernize practices and improve quality while reducing costs in the Medicare system.

More details about the plan are expected to be released in the next few days, and the NCMS will provide updates in the Bulletin and at www.ncmedsoc.org. Share your thoughts below.