Physicians who see Medicare patients have reason for cautious optimism that the Sustained Growth Rate (SGR) formula could possibly be repealed this year. Recently, a bipartisan proposal outlining an overhaul of the SGR formula as well as Medicare physician payment reform was released by the Senate Finance Committee and House Ways and Means Committee. The North Carolina Medical Society (NCMS) recently was among nine other state medical societies that signed on to a letter from the Coalition of State Medical Societies (CSMS) applauding the bipartisan effort and urging the chairs of these Committees to get the job done and repeal the SGR. Read a copy of the letter here.

As in previous years, unless Congress acts by January 1, physician Medicare reimbursement payments will be cut dramatically. In 2014 that would mean a 24.4 percent reduction. In the past, Congress has acted to reduce the cut at the eleventh hour. Permanently repealing the SGR and reforming the payment system is a vital step to preserve access to care for Medicare beneficiaries and is being watched closely by health care groups across the country.

The CSMS letter supports the following elements of the House-Senate proposal:

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

The CSMS, however, believes the final legislation must achieve these improvements as well:

• Provide appropriate annual updates to sustain 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 value-based modifier (VBM) measures and methods in a new value-based payment program, revise them so (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.
• 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.