New Congress renews efforts to repeal SGR

The sustainable growth rate formula that determines Medicare cuts to providers will be a high priority for the 113th Congress that started this week, MedPage Today reported. Nevertheless, policy experts at last week's Society of American Business Editors and Writers in New York City told FierceHealthcare they are less hopeful that the back-and-forth SGR debate will ever end.

Rep. Kevin Brady (R-Texas), the new House Ways and Means Health subcommittee chair, pointed to an estimated 25 percent to 30 percent of healthcare administrative costs and urged reducing overhead costs to 10 percent within five years through national initiatives.

"Brady anticipates working … to unveil legislation permanently repealing Medicare's (SGR) formula and replacing it with a reliable physician reimbursement formula that rewards quality," his office said last week.

The current SGR subjects providers to possible cuts each year, now worth 27 percent in reduced Medicare reimbursements to hospitals and physicians. Even with repeated delays, the short-term "doc fix" hangs on for another 12 months with passage of the Taxpayer Relief Act.

Providers, including the American Hospital Association, have said the SGR system, as is, could result in physicians turning away Medicare patients and jeopardizing care for seniors.

Even though the head of the House health subcommittee says a permanent SGR fix is in the works, the cycle of temporary doc fixes may never end, Sherry Glied (pictured right), former U.S. Department of Health & Human Services' assistant secretary for planning and evaluation during Obama's first term, said at the conference for journalists.

"SGR is the gift that keeps on giving," Glied, a Columbia University healthcare policy professor, quoted another Washington insider about the back-scratching in Washington.

Pointing to the lobbying power of provider groups--hospitals being one of the strongest--she noted trade groups inject Congress with money, and Congress then delays the cuts to Medicare reimbursements. It's the wink-wink-nudge-nudge dynamic that has plagued politics for years--a "symbiotic relationship," as Glied called it.

Repealing the SGR formula is only one of the proposed healthcare reforms on table for the new Congress, DOTmed News reported. Other topics up for discussion include dissolving the Independent Payment Advisory Board, raising the Medicare eligibility age and requiring wealthy beneficiaries to pay higher premiums, MedPage Today noted.

For more information:
- read the MedPage Today article
- see the DOTmed News article
- here's the statement from Brady

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