SGR repeal becomes reality

As predicted, legislators repealed the sustainable growth rate (SGR) formula after nearly 20 years of last-minute patches amid physician strife. Although the House of Representatives passed a bill to banish the SGR in March, the Senate approved the "doc fix" legislation upon returning from recess, just hours before the midnight deadline on April 14, FierceHealthcare reported.

Finally, President Barak Obama signed the legislation on April 16, praising the bipartisan nature of the bill. Nonetheless, the Centers for Medicare & Medicaid Services informed healthcare providers that "a small volume of claims" are being processed at the lower levels, but will later be reprocessed so providers receive their full fees, according to the New York Times.

But despite this hiccup and industry concern that the reimbursement outlined in the bill still isn't enough to keep up with costs over time, medical groups cheered the Medicare Access and CHIP Reauthorization Act (MACRA).

"This is a historic day--the dark cloud over physician group practices has been lifted," Halee Fischer-Wright, M.D., president and chief executive officer of the Medical Group Management Association stated April 14.

Along with avoiding uncertainty over future Medicare payments through a guaranteed annual 0.5 percent increase in Medicare reimbursements through 2019, with the 2019 payment level to be maintained through 2025, the bill accelerates the transition from fee-for-service payment to more value-based models.

In particular, the law consolidates Medicare's Physician Quality Reporting System, Value-based Modifier and the Meaningful Use incentive programs into a single merit-based incentive payment system (MIPS). Medicare physicians will also be eligible for incentive payments by participating in value-based care models and meeting specified thresholds, noted Medical Practice Insider.

Small practices will receive a collective $100 million in funding and technical support needed to participate in new payment models, according to the law, with priority given to rural practices, locations with shortages of health professionals, medically underserved areas and practices with low composite MIPS scores, MPI added. The law also keeps Medicare quality program standards and measures from being used as a standard or duty of care in medical liability cases.

"While the bill supports physicians who choose to adopt new payment and delivery models, it also retains Medicare's fee-for-service model," praised the American Medical Association. "Participation in new models is entirely voluntary."

To learn more:
- read the article from Medical Practice Insider
- here's the story from the New York Times
- read the post from AMA Wire
- see the bill (.pdf)

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