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Rebecca Farley

Director, Policy & Advocacy, National Council for Behavioral Health

House Committee Unanimously Approves Medicare Physician Pay Reform

August 1, 2013 | Medicare | Comments
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The House Energy & Commerce Committee this week unanimously passed legislation to reform and repeal the Medicare physician Sustainable Growth Rate (SGR) formula. This formula requires yearly adjustments to physician pay to bring it into line with an approved formula for sustainability; however, in practice it has resulted in large potential cuts that Congress overrides each year. Physicians and Medicare advocates have long urged a permanent fix for the SGR, but Congress to date has not been able to agree on how to offset the expense.

The Medicare Patient Access and Quality Improvement Act of 2013 (H.R. 2810) repeals the SGR formula and replaces it with a new system for physician payments under Medicare.  Broadly speaking, the bill would require 0.5% updates to physician payments for 2014-2018. Starting in 2019, payments would be increased by as much as 1.0% or decreased by as much a 1.0% based on physician performance on quality metrics. In addition, the legislation extends the scope of eligibility for nurse practitioners and physician assistants to qualify for reimbursement for complex chronic care management services.

Despite Wednesday’s unanimous vote, the legislation still faces an uphill battle. H.R. 2810 did not include details on how it would be paid for, the most contentious point in past debates on the SGR. Companion legislation has not been introduced in the Senate, although conversations on how to address the SGR have begun in the Senate Finance Committee.