Providers praise proposed SGR repeal, fee-for-service phase out

A proposed House bill would permanently repeal the sustainable growth rate (SGR) formula, preventing a 30 percent Medicare pay cut in 2013, and would phase out fee-for-service payments.

The Medicare Physician Payment Innovation Act of 2012, proposed by Rep. Allyson Schwartz (D-Pa.) and Rep. Joe Heck, (R-Nev.), would use savings from the military pull-out from Iraq and Afghanistan to cover all costs, reported Medscape Medical News.

The bill's timetable for reforming the Medicare physician payment system is a slightly adjusted version from the plan Schwartz called for last fall. This time, payment rates would stay at 2012 levels for one year; then from 2014 to 2017, primary care, preventive and care-coordination services would get a 2.5 percent annual increase, while reimbursement for other services would rise 0.5 percent, according to the bill summary.

Moreover, in 2018, physicians would get rewarded for value over volume, although Medicare still will pay physicians on a fee-for-service basis at 2017 levels. After that, physicians still using fee-for-service will face 2 percent pay cuts in 2019, 3 percent in 2020, 4 percent in 2021 and 5 percent in 2022, with fee-for-service rates frozen at 2022 levels going forward.

Provider groups already have praised the plan to repeal and replace SGR. For instance, the American College of Physicians "enthusiastically supports" the bill. "It not only addresses the continued threat of the SGR formula, it also addresses moving us beyond the fee-for-service payment model toward new models that better align payment with value," ACP President David L. Bronson said in a statement.

Meanwhile, Glen Stream, President of the American Academy of Family Physicians, said his members are pushing Congress to pass the bill. "This legislation begins the transition to a sustainable payment system and helps our complex system better recognize the value of primary medical care," he said in a statement. "Only by stabilizing Medicare physician payment can we ensure that elderly and disabled patients will have access to the care they need, when they need it."  

For more information:
- here's the a summary of the bill and provider support
- read the Medscape article

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