New SGR Bill Released

In early 2015, ASH advised members on the status of the Sustainable Growth Rate (SGR), the payment formula that each year leads to potential cuts in Medicare physician payment and each year is averted by Congressional action. ASH had expected to see Congressional action on a temporary fix given the new Congress and the April 1 deadline. However, we were surprised to see developments that eventually led to the March 19 introduction of a House of Representatives bill that would permanently address the issue. This bill largely follows the policy of the bill that was introduced by the committees of jurisdiction during the last Congress. That bill, which ASH supported, eliminated the SGR update formula in favor of an update schedule that increased payment by 0.5% each year for the first five years, and then no additional increases in payment for the following five years unless a physician group had significant participation in new payment models that included more risk. The legislation would reorganize and provide more flexibility for physician quality reporting, pay-for-performance, and health information technology meaningful use, but would still retain these requirements as part of the Medicare physician fee schedule.

The bill introduced on March 19 has little substantive differences from last year’s bill so ASH continues to support the bill. As in previous years, the issues with passage of the bill largely relate to the identification of budgetary offsets that could include decreased spending for federal programs or increased taxes. While not formally released, multiple media reports have indicated that payment for the bill could include cuts to hospital payment, increased premiums for high income Medicare beneficiaries, and required deductibles for Medicare Advantage plans.

ASH’s Committee on Government Affairs took to Capitol Hill the day before the bill was released and had extensive discussions regarding the importance of creating a stable base for Medicare physician payment. The situation in the House and Senate remains fluid but leaders are targeting this legislation for a vote during the week of March 23, which precedes a two week Congressional recess. ASH encourages members to contact their Senators and Representatives and express support for the passage of this legislation.