House passed SGR repeal bill

The House of Representatives voted Thursday in favor of legislation that would get rid of Medicare’s sustainable growth rate formula.

The measure now goes to the Senate, where there will be pressure to act quickly to avoid an automatic 21.2% cut in Medicare reimbursements to physicians scheduled to go into effect April 1.

The legislation—supported by both Speaker of the House John Boehner and House Democratic Leader Nancy Pelosi—passed by a 392-37 vote. According to news reports, the legislation’s prospects in the Senate are less certain, but improving.

If it does get through the Senate, President Obama has indicated he will sign off on the legislation.

Under the bill,  the SGR formula would be replaced with a system that would provide for 0.5% reimbursement increase over the next four years for physicians and create incentives that reward physicians who hit quality and efficiency targets.

In a column Thursday in the National Review, Boehner, called today’s vote “an important step toward reining in cost while protecting patients.”

Referring to next Wednesday when doctors are scheduled to be hit with the automatic 21.2% reimbursement cut, Boehner wrote, “We’ve faced this cliff before, nearly 20 times over the past dozen years. And every time, instead of actually addressing the problem with real reforms, Congress has punted with a temporary 'doc fix.' But this time can be different.

“if enacted, this bill will permanently replace one of Washington’s most infamous budget gimmicks, SGR, with a more stable system that rewards quality and innovation,” he added

Since 2003, Congress has passed 17 short-term bills to avoid physician reimbursement cuts calculated under the SGR formula. To help defray some of the costs associated with the SGR repeal bill some higher-income Medicare beneficiaries will be required to pay more expensive premiums.  But most of the costs—about $141 billion, according to an analysis by the Congressional Budget Office—will be added to the federal deficit.

The American Medical Association—which has long led the charge against the SGR—applauded the House’s action and called on the Senate to move quickly on the bill.

“When passed by the Senate, the bill will put an end to the cycle of Congress passing expensive patches to extend a policy that all agree was bad in the first place,” said AMA President Robert M. Wah, in a statement. “The new policy supports innovative new delivery and payment models that will help improve care quality, health outcomes and lower costs. It also assures access to care for children, low-income individuals and families by extending funds for the Children’s Health Insurance Program and community health centers.”