House Passes Two-year SGR Fix; Senate Unlikely to Agree

December 14, 2011

The US House of Representatives passed a package of extensions (HR 3630) on December 13 that includes a two-year fix to Medicare physician reimbursement rates (the Sustainable Growth Rate, or SGR) along with a 1 percent increase in payments. The $38 billion fix would be paid by limiting Medicare benefits for high-income beneficiaries and by redirecting funding from the federal health reform law that was intended for prevention and public health services.

The so-called "doc fix" is part of a package that includes an extension of a payroll tax cut set to expire at the end of 2011. The package also includes a provision that pushes forward the stalled Keystone XL oil pipeline project, which both President Obama and Senate Majority Leader Harry Reid oppose, making it unlikely the Senate will agree with the House proposal.

According to the American Medical Association, key provisions affecting physicians include:

1-percent update 2012 and 2013, cliff financing, and a Congressional Budget Office projected 37-percent cut in 2014.
The Secretary of Health and Human Services and the General Accounting Office would conduct studies on new payment models by January 1, 2013. MedPAC would study the feasibility of aligning private payer and Medicare quality and efficiency programs by March 1, 2013.
The House and Senate Committees of jurisdiction would study and review value-based measures and practice arrangements that may improve Medicare health outcomes and efficiencies to replace the SGR and establish a sustainable payment system, and shall solicit comments from stakeholder physician groups, including state medical associations.

AAN members are encouraged to send a pre-written message to their representatives on Capitol Hill asking them to continue pursuing a permanent fix to the flawed SGR formula.

Stay tuned to AAN.com for further updates.