House Energy and Commerce Panel Approves SGR Legislation
On Wednesday, the House Energy and Commerce Committee voted 51-0 to approve bipartisan legislation (HR 2810) that gradually would repeal the sustainable growth rate formula, which determines Medicare physician reimbursement rates, the Washington Times reports. The bill now heads to the full House for consideration (Howell, Washington Times, 7/31).
Under the proposal, Medicare physician reimbursements would grow by 0.5% annually over five years. Starting in 2019, Medicare would switch to an enhanced fee-for-service system that would provide physicians with updates and payment incentives based on their performance on certain quality measures.
The quality measures -- which would compare physicians with others in their subspecialty -- would be based on:
- Care coordination;
- Clinical care;
- Patient experience;
- Patient population; and
The proposal also directs HHS Secretary Kathleen Sebelius to review and finalize the quality measures for the upcoming year by Nov. 15 of each year. In addition, the HHS secretary would be required to develop codes for complex chronic care management services and develop a fee schedule for those services starting in 2015.
The proposal calls for providing physicians with feedback on their performance in meeting the quality measures in "as real time as possible, but at least quarterly."
The bill would allow physicians to opt out of the fee-for-service system and choose an alternative payment model that emphasizes efficient and quality care, such as:
- Accountable care organizations;
- Bundled payment programs; or
- Patient-centered medical homes.
In addition, CMS would be required to collect recommendations from professional groups on payment bundles for chronic conditions and costly, high-volume services. The bill also includes a provision to expand physicians' access to Medicare data.
Funding Source Remains Unclear
The legislation still does not include full details on how it would offset the cost of repealing the current payment system. CBO has estimated the total cost of repealing the SGR would be $139.1 billion over 10 years. However, the bill does authorize transfers from the Medicare Part B trust fund to provide some funding for some of its provisions (California Healthline, 7/24).
Committee Approves Amendments
Before passing the legislation, the House Energy and Commerce Committee approved an amendment -- proposed by Rep. Michael Burgess (R-Texas) -- that would allow qualified nurse practitioners and physicians' assistants to participate in coordinated care programs (Khatami, CQ Roll Call, 7/31). The committee also approved changes to certain Medicare payment programs and altered components of the alternative payment model section.
Industry Groups Voice Concerns
Several national and state physician groups in a letter to lawmakers last week criticized a provision in the bill that does not require CMS to redirect savings collected from overpaid Medicare programs to other, undervalued services, MedPage Today reports.
Specifically, the bill requires CMS to reduce payments by 1% annually to programs it overpays from 2016 through 2018. However, it does not require CMS to redistribute those funds. "The bill would remove savings realized from relative value unit reductions out of the payment pool rather than allowing them to be redistributed to other physician services," the letter states, arguing that the provision could undermine the bill's planned payment increases.
The letter's signatories included the American Academy of Family Physicians, the American College of Physicians, the American College of Surgeons, the American Medical Association, the Medical Society of New Jersey, the Michigan State Medical Society, the Pennsylvania Medical Society and the Texas Medical Association (Pittman, MedPage Today, 7/31).
Senate Panel Pledges To Propose 'Doc Fix' Legislation
Meanwhile, the Senate Finance Committee recently held a closed-door meeting to discuss their own bipartisan 'doc fix' legislation, which it expects to be introduced after the August recess, CQ Roll Call reports.
During the meeting, the lawmakers considered several ideas about how to pay for the legislation, including a bill proposed by Sen. Jay Rockefeller (D-W.Va.) that would require drugmakers to offer the federal government rebates on drugs used for individuals eligible for both Medicaid and Medicare. CBO projected that Rockefeller's legislation would save $141.2 billion over 10 years, enough to fund the estimated $139.1 billion cost of repealing SGR.
However, the Senate panel has not yet fully developed a plan to replace the SGR. Sen. Benjamin Cardin (D-Md.) said the committee is focused on two areas to develop the legislation, including how "you deal with managing care better, particularly high-cost interventions, and how ... you determine the relative value of physician services" (Ethridge, CQ Roll Call, 7/31).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.