On Thursday, February 7, 2013, the House Committees on Ways and Means and Energy and Commerce jointly distributed a three pronged plan (PDF) for repealing and replacing the Sustainable Growth Rate (SGR) formula. This action marked the first step in a long, methodical effort by the House of Representatives in the 113th Congress to finally alleviate physicians from this flawed reimbursement formula. Although the first document outlining an approach for repealing and replacing the SGR was jointly issued, the House Energy and Commerce Committee primarily led the initial legislative efforts to reform the way physicians are reimbursed through Medicare. The first seven months of the 113th Congress witnessed the Energy and Commerce Committee holding several Congressional hearings and soliciting comments from various health care stakeholders on numerous preliminary SGR concept documents and draft legislative language.
The Committee's extensive process of developing a comprehensive, bipartisan legislative proposal to repeal the SGR culminated on July 31 when Representatives Michael Burgess, MD (R-TX), Fred Upton (R-MI, Chairman of the Energy and Commerce Committee), Joe Pitts (R-PA, Chairman of the Energy and Commerce Health Subcommittee), Henry Waxman (D-CA, then Ranking Member on the Energy and Commerce Committee, now retired), Frank Pallone (D-NJ, then Ranking Member of the Energy and Commerce Health Subcommittee) and John Dingell (D-MI, now retired) introduced H.R. 2810, the Medicare Patient Access and Quality Improvement Act of 2013.
In lieu of the scheduled reimbursement cuts associated with the SGR, H.R. 2810 sought to accomplish three primary goals: provide physicians with a period of budgetary certainty, develop a modified fee-for-service system, and accelerate the movement towards reimbursing physicians through alternative payment models.
Phase 1 of the plan focused on repealing the SGR, as well as providing a statutorily defined five year period of “stable” payment rates. Between 2014 and 2018, payments to physicians treating Medicare patients would increase by 0.5% in comparison to current rates.
Phase 2 of the SGR reform plan focused on reforming the current fee-for-service payment system in favor of rewarding physicians who “provide high quality care." Starting in 2019, under the newly created Quality Update Incentive Program (QUIP), physicians who successfully met a series of quality measures and clinical improvement activities within a self-selected peer cohort were given the opportunity of gaining an additional 1% increase in Medicare payments. Conversely, physicians who scored poorly on this collection of quality measures and clinical improvement activities faced a 1% reduction in Medicare payment rates. Physicians who elected not to participate in the modified fee-for-service system were automatically subjected to a 5% reduction in Medicare payment rates.
Finally, Phase 3 of the legislation created a framework for physicians to develop, test, and seek approval from the Secretary of Health and Human Services (HHS) for alternative payment models. Although patient centered medical homes, accountable care organizations, and variations on either episodic or bundled payments are the most common form of alternative payment models currently employed within the health care system, H.R. 2810 thoroughly encouraged physicians to collaborate and develop new, innovative ways to treat patients. Physicians were permitted to opt-out of the traditional or modified fee-for-service system at any time in favor of an approved alternative payment model. The policy parameters of the approved alternative payment model governed reimbursement for participating physicians.
Thanks to the tireless efforts of ACR’s physician leadership and membership working in concert with the Federal Government Relations Department, H.R. 2810 also included provisions specifically addressing the 25% professional component (PC) multiple procedure payment reduction (MPPR), as well as the expansion of web-based clinical decision support (CDS) tools. With respect to the PC MPPR, language was included mandating that the Centers for Medicare and Medicaid Services (CMS) finally disclose the specific data that was used in the Calendar Year 2012 Medicare Physician Fee Schedule Final Rule when the 25% reimbursement cut was initially proposed. To date, CMS has never disclosed a line-by-line data analysis in justification of the PC MPPR and ACR has consistently disputed the existence of such data. While the provisions added to H.R. 2810 remain silent on the actual 25% PC MPPR, if enacted, inclusion of this language ensured that Congress properly monitored CMS with respect to this policy and was designed to further the College’s efforts to ultimately repeal this imaging reimbursement cut.
H.R. 2810 also mandated that the Secretary of Health and Human Services provide a report to Congress on the effectiveness of clinical decision support (CDS) tools within the Medicare system. This report, which was required to be completed a year after the bill’s enactment, mandated the inclusion of specific recommendations for how CDS tools should be employed. It is important to note that Energy and Commerce Committee decided not to outline how Congress plans to cover the cost of repealing the SGR. Instead, the Energy and Commerce Committee elected to develop the key characteristics of the new physician reimbursement system while leaving the decisions over financial offsets to both the House Ways and Means and Senate Finance Committees.