Repeal of the Medicare Sustainable Growth Rate has clear momentum, but with 2013 winding down and the $139 billion price tag still unresolved, physicians could be facing yet another short-term fix.
There is unmistakable momentum in Congress for repealing the Medicare Sustainable Growth Rate (SGR), but as 2013 winds down with Congress eyeing the holiday recess, physicians could be facing the possibility of yet another short-term fix.
Next week, the Senate Finance Committee holds an executive session to mark up the bipartisan draft proposal that would repeal the SGR and replace it with a mix of payment freezes and alternative payment models that reward physicians with bonuses for value and quality rather than volume. The draft proposal was crafted with the House Ways and Means committee and released at the end of October.
Repeal would be a landmark moment for Congress and physician groups, such as the American Medical Association (AMA) and the American College of Physicians (ACP), because it is the first time both chambers and parties agreed on a plan physicians say they can stomach.
"Clearly now we have a trajectory of activity that has never been seen before in the history of our work around the SGR," says AMA President Ardis Dee Hoven, MD. "It started with the House Energy and Commerce committee. They started running the ball down the field, and [House] Ways and Means and [Senate] Finance obviously are picking up on this. It's bipartisan, bicameral, and it's enthusiastically supported."
The proposal isn't without criticism from the AMA or other groups, but with repeal in view the focus is on getting a bill passed. In fact, the AMA and the ACP were among physician and provider groups that met with staff from both the Senate Finance and House Ways and Means committees on Wednesday to find out how the committees responded to their concerns in the draft proposal.
The ACP issued a statement after the meeting saying the newest proposal included two of the organization's suggestions:
- Increase funding for performance measure development and validation
- Increase funding for physicians in smaller practices—and expands eligibility to smaller practices that fall outside of health professional shortage areas—to assist them in making the transition to VBP programs and other alternative payment models.
However, despite the momentum behind repealing the broken physician payment system, the issue of paying the bill's $139 billion price tag remains.
Ken Perez, a healthcare policy consultant, says the atmosphere that exists in Washington, D.C., will make finding that much money difficult.
"People fight over $10 billion-$20 billion," he says. "Paying for the SGR repeal is the Achilles' heel. Because of the cost and the deficit reduction climate, [Congress] is not going to add to the deficit. It comes back to the numbers. That's the cold, hard reality."
The AMA stays strictly "on the policy side" of things, though Hoven admits the fiscal question of how to pay for the SGR repeal is significant and consistent.
"We hear this every time we visit with members of Congress," she says.
One plan that Perez believes is a realistic possibility is the Medicare Drug Savings Act sponsored by Sen. Jay Rockefeller (D-WV) who is also a member of the Senate Finance committee, which will be marking up the SGR repeal bill next week.
Rockefeller's bill extends discounted drug pricing to the dual-eligible population, saving an estimated $141 billion over 10 years. That makes the SGR fix more than budget-neutral. To drum up backing for the bill, Rockefeller sent letters (PDF) to 65 hospital, physician, and provider groups in November asking for their support.
But the AMA and other groups run the risk of weakening their Congressional clout if they take sides on a bill paying for the SGR, such as Rockefeller's. His bill has zero support among Republicans and is opposed by the powerful pharmaceuticals lobby.
Perez describes the juxtaposition of bipartisanship on a single issue in a session marked by partisan politics as "a day of reckoning" for the SGR.
"If you have Republican and Democratic agreement on the SGR, then the question is, 'Are the Republicans so in favor of that [that] they're willing to go along with a Democratic bill?'"
The answer remains unclear, though with the House set to recess for the holidays the day after the proposal markup, it is unlikely there will be any progress on the bipartisan legislation to end the SGR before the end of the calendar year.
Nicholas Manetto, vice president at the K Street lobbying firm FaegreBD Consulting, says the SGR repeal could move quickly, even with a narrow window. He says it depends on the progress at next week's mark-up meeting.
"The big issue is timing," says Manetto. "At next week's committee meeting, [groups] will be looking to see if the bill gets bogged down with a lot of amendments that make it harder to move."
Any budget offsets to pay for the SGR repeal will not be offered by Senate Finance committee chairman Max Baucus (D-Mont.). His office confirmed it would not identify any offsets prior to next week's hearing.
Talks about a temporary patch have resurfaced because of budgetary and debt ceiling constraints, which raises the hackles of the AMA.
"We've already spent $146 billion to patch over the last 10 years," says Hoven. Repealing the SGR "is the fiscally responsible thing to do, and members of Congress get it. They know it. If they don't repeal it and don't get us to a better model that is going to work, it is going to continue to cost this country billions and billions of dollars, and that's inappropriate."
The chairman of the House Ways and Means committee, Dave Camp (R-Mich), issued a statement Thursday that echoes the AMA’s position of forgoing another temporary workaround:
"SGR is an important issue for physicians and seniors alike who, for over a decade, have been hamstrung by short-term patches instead of the certainty of a permanent solution. The Committee has made real progress on a bipartisan and bicameral bill. If that progress continues, I expect the Committee to consider the legislation before the end of next week."
Jacqueline Fellows is a contributing writer at HealthLeaders Media.