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SGR Ripe for Repeal

 |  By Margaret@example.com  
   June 11, 2013

The cost of repealing the sustainable growth rate formula is $106 billion less than a year ago. Lawmakers have been holding hearings and stakeholder suggestions are pouring in. Is this the year a doc fix bill will be passed?

The cost of repealing the sustainable growth rate formula is practically at fire sale prices. The Congressional Budget Office put a $138 billion price tag on its most recent 10-year score for repealing the SGR. That's $106 billion less than its 2012 score and just the kind of savings that will resonate with the constituents back home.

Around Capitol Hill there's a lot of talk about seizing what Sen. Max Baucus (D-MT), chair of the Senate Finance Committee, likes to call "this window of opportunity." One House bill has been formally presented to repeal and replace the SGR. Three more pieces of legislation—one from the Senate and two from the House—are expected.

And at least three influential Congressional committees—Senate Finance, House Ways and Means, and House Energy & Commerce—have held hearings for stakeholders to present their ideas on how best to replace the SGR. In addition, the chairs of Senate Finance and House E&C committees have asked hundreds of stakeholders to submit in writing specific recommendations for repealing and replacing the SGR.

But while there is movement toward a resolution, momentum is elusive.

At the Medical Group Management Association, Anders Gilberg, senior vice president for government affairs, is optimistic. He sees significant interest in resolving SGR policy. Noting that in recent years big policy discussions seem to take place during the fall, he says it's a good sign that "it's not even summer yet and the House and Senate are engaged on this issue. They are talking to stakeholders and collecting ideas."

John Williams, an attorney who specializes in government and public policy for Hall, Render, Killian, Heath & Lyman, an Indianapolis-based health law firm, stated in an e-mail exchange that even though it's only June, Congress is running out of 2013 calendar to see SGR action by both the Senate and House. " I think you might see something get out of one of the House committees this year, but I'm hard pressed to see how they [will] get a repeal bill done."

Williams, who heads the firm's federal advocacy practice group, also noted that no real SGR repeal bill is moving through any committee. "Although I hear it's not due to any animosity, House Ways and Means and Energy & Commerce are no longer working on a joint solution." The GOP members of E&C have released "a legislative outline, but it doesn't have enough details to be converted into a bill yet."

Meanwhile, HR 574 (Medicare Physician Payment Innovation Act of 2013), a bipartisan effort from Rep. Allyson Schwartz (D-PA) and Rep Joe Heck (R-NV), was introduced in February and referred to House Ways and Means and E&C, where it remains. The bill includes a five-year period of payment stability popular with physicians.

"Before we know it, the August recess will be upon us and there still won't be a bill moving," said Williams.

Another reason for concern: CBO releases its revised budget estimates in August. If the price tag for SGR repeal posts a significant increase, "any chance of repeal this year is dead," stated Williams. In that case he expects Congress will do another temporary "doc fix" bill at the last minute before Christmas that corrects the problem for "somewhere between one and (maybe if Boehner gets his way) four years."

Williams and Gilberg agree that while policy and price will be dealt with in separate pieces of legislation, even the $139 billion price tag for SGR repeal will be a tough sell. "I'm hard pressed to see how rank and file Republicans in the House will support anything that increases spending by that amount," said Williams.

Gilberg says it's unlikely that any pay fors or offsets will be addressed in a stand-alone SGR bill. That could be too polarizing, especially if the SGR funding involved reducing the money available for other parts of the healthcare budget.

The more likely scenario says Gilbert is that SGR repeal funding will be part of comprehensive legislation addressing deficit reduction or something equally large in scope. "It's just easier to do that way."

Williams agrees. "[Republicans] might be willing to hold their noses and vote for [the cost of repealing the SGR] as part of a larger package like tax reform."

Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
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