Practice Economics

Medicare at 50: Is the end near for SGR?


 

References

The goal is “to move away from the old way of doing things, which amounted to, ‘the more you do, the more you get paid,’ by linking nearly all pay to quality and value in some way to see that we are spending smarter,” Ms. Burwell said in a blog post on the HHS website.

Dr. Blase Polite

Dr. Blase Polite

As part of that effort, the department aims to have 30% of Medicare payments tied to quality or value through alternative payment models by the end of 2016.

Further, real efforts to repeal the SGR took hold in the last Congress, with strong support to pass legislation among lawmakers of both parties in the House and in the Senate. H.R. 4015, SGR Repeal and Medicare Provider Payment Modernization Act of 2014, passed the House but was not taken up by the Senate.

“We were cautiously optimistic that this 17th year of trying to repeal the SGR might have been the successful one,” Dr. Patrick T. O’Gara, president of the American College of Cardiology, said in an interview. He said that the sticking point seemed to be that “there was no politically viable way to pay for it.”

Dr. David A. Fleming, president of the American College of Physicians, noted in a statement that finding the money had hung up what otherwise was huge progress: a bill that members of the House and Senate, Republicans and Democrats had put together, and that ultimately passed the House.

Renewed efforts at repeal are underway in the current Congress. The House Energy and Commerce Committee’s Health Subcommittee held 2 days of hearings in January, hearing from doctors and health economists on how to cover the $140 billion cost of SGR repeal. Although experts presented their thoughts on where the health care sector could come up with the money, Rep. Fred Upton (R-Mich.), chairman of the full committee, recently suggested that the funding might come from outside the health care sector, such as from his proposal to legalize Internet poker.

But with time running short, some believe that another SGR patch is in the cards and that repeal will come attached to a broader piece of legislation at the end of the year.

“I don’t think there is any way it gets fixed by the March deadline because the payment offsets are just far too complicated. I think that it has to wait to be incorporated, my guess, in a larger bill,” ASCO’s Dr. Polite said. “That’s how I would do it. You want to include it in a much bigger package of tax reforms, perhaps other entitlement reforms where there’s a lot of pluses and minuses of money flow and the $140 billion for SGR is easy to take care of in that.”

He also cautioned that if it is not taken care of this year, it could be at least another 2 years before the window for repeal is opened.

“There is some talk about it getting delayed 18 months,” Dr. Polite said. “I hope that doesn’t happen because if you kick this can down the road 18 months, you basically put us in the 2016 election cycle and nobody’s coming up with $140 billion during that time. Eighteen months basically means we will see you after the 2016 presidential election. And it would be a shame.”

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