Overview of Sustainable Growth Rate/Physician Payment Reform

Although the 113th Congress concluded without passage of a bill to permanently repeal this flawed formula, federal lawmakers came agonizingly close to achieving this elusive goal in 2014. New reports from the Congressional Budget Office (CBO) which pegged the cost of eliminating the SGR at only $138 billion over 10 years had numerous Democrats and Republicans in both the House and the Senate bullish about passing legislation to reform the way physicians are reimbursed through Medicare. For comparison purposes, previous CBO analyses estimated SGR repeal at an exorbitantly high $300 billion over 10 years.

In fact, the more optimistic budgetary outlook resulted in the introduction of numerous, serious proposals to eliminate this antiquated formula, including H.R. 4015/S. 2000, the SGR Repeal and Medicare Provider Payment Modernization Act , S. 2157, the Common sense Medicare SGR Repeal and Beneficiary Access Improvement Act of 2014, S. 2122, the Responsible Medicare SGR Repeal and Beneficiary Access Improvement Act of 2014, the House Committee on Energy and Commerce's three pronged approach (H.R. 2810, the Medicare Patient Access and Quality Improvement Act of 2013), and the Medicare Physician Payment Innovation Act. H.R. 4015/S. 2000 was bipartisan, bicameral legislation to repeal the SGR, yet no methods of covering the cost of this legislation were offered by lawmakers. S. 2157 was primarily a Democratic proposal to offset the cost of repealing the SGR by utilizing unspent money reserved for the conflicts in Iraq and Afghanistan, commonly referred to as Overseas Contingency Operations. On the contrary, S. 2122 was a predominately Republican proposal to offset the cost of repealing the SGR through a repeal of the Patient Protection and Affordable Care Act’s individual mandate.

Ultimately, disagreement over how to finance the repeal of this flawed reimbursement system, a condensed legislative calendar, and midterm election year politics prompted lawmakers to enact yet another short term patch in March 2014, specifically H.R. 4302, the Protecting Access to Medicare Act. This legislation provided a 0.5 percent increase in Medicare reimbursement for all physicians through December 31, 2014. In addition, the legislation froze Medicare payments at their new, slightly higher 2014 rates through March 31, 2015.

In addition to staving off the latest SGR cuts, H.R. 4302 included several important imaging specific provisions. Thanks to the combined efforts of the ACR physician leaders and members, along with the Government Relations staff, H.R. 4302 included provisions requiring ordering physicians consult imaging-specific appropriateness criteria prior to referring Medicare patients for advanced imaging procedures. The legislation also included a cap on the amount codes reimbursed through the Physician Fee Schedule (PFS) could be reduced in a given year. Finally, H.R. 4302 also mandated that the Secretary of Health and Human Services (HHS) disclose data used by the agency to justify the imposition of a 25 percent professional component multiple procedure payment reduction (PC MPPR) in 2012.

Although appreciative of the temporary patch and the many imaging specific provisions included within the bill, ACR worked tirelessly throughout 2014 to encourage members of the House and Senate to make the fiscally responsible choice and permanently repeal the SGR.

SGR Reform in the 114th Congress - the Medicare Access and CHIP Reauthorization Act

Absent Congressional intervention, all physicians, including radiologists, faced the prospect of an approximately 21 percent cut in Medicare reimbursement on April 1, 2015. With the deadline quickly approaching, former House Speaker John Boehner (R-OH) and Minority Leader Nancy Pelosi (D-CA) came together to forge an historic bipartisan compromise to permanently repeal the SGR. In fact, on Tuesday, March 24, 2015, the House introduced H.R. 2, the Medicare Access and CHIP Reauthorization Act of 2015, which was ultimately passed by an overwhelming bipartisan majority (392 Ayes and 37 Nays) on March 26, 2015. Although they indicated strong support for repealing the SGR, a condensed legislative calendar prevented the United States Senate from passing H.R. 2 prior to adjourning for a two week recess on Friday, March 27, 2015. Ultimately, the Senate passed the legislation with a large bipartisan majority (92 Ayes to 8 nays) on April 14, 2015. President Obama signed H.R. 2 into law on April 16, 2015.

ACR greatly appreciates Congress finally passing legislation to repeal the flawed SGR and looks forward to working with the Centers for Medicare and Medicaid Services to implement the major sections of H.R. 2, the Medicare Access and CHIP Reauthorization Act.

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