From the Emergency Department Practice Management Association (EDPMA):
In an environment of partisan bickering and gridlock, there is one important issue that has bipartisan support – replacing the Medicare reimbursement formula that poses deep cuts to Medicare physician reimbursement rates. Reimbursement rates are scheduled to be cut by 24-25% on January 1, 2014 unless Congress either repeals and replaces the current reimbursement formula (which is based on the SGR) or, at minimum, delays the scheduled cut for another year. Both parties oppose the cut, but the cost of repealing or delaying the cut is very expensive.
In earlier Advocacy newsletters, EDPMA summarized legislation that was unanimously supported by members of both parties in the House Energy and Commerce Committee (HR 2810). Yesterday, the two other key committees with jurisdiction over this issue – the Senate Finance Committee and House Ways and Means Committee – have released a joint framework for repealing the SGR formula. The framework is available here.
Under this new proposal, physicians could opt to stay in the FFS system, but their reimbursement rates would be frozen for ten years. Alternatively they can get reimbursed under an approved alternative payment model (which may include payment models applicable to ACOs and medical homes).
Those who remain in traditional Medicare would be eligible for value-based incentives under a quality program. However the three existing quality programs would become one budget-neutral program. Under a budget neutral program, physicians with lower quality scores can expect to see lower reimbursement rates while those with higher scores will see their reimbursement rates increase. If this proposal were adopted, the performance period for that program would likely begin in 2015, with incentive payments starting in 2017.
This new proposal is not as generous to physicians as the Energy and Commerce proposal. It freezes payments for ten years instead of providing yearly updates. Leadership in the Finance and Ways and Means committees hopes this change will keep the cost down and thereby improve its chances of passage.
This proposal is expected to help create momentum behind efforts to repeal and replace the formula this year. But, many in Congress are focused on other issues – such as negotiations surrounding the budget and debt ceiling. Moreover, there are few legislative vehicles moving at the end of the calendar year. So, legislation to either repeal the formula or delay the cut might not be addressed until early next year when Congress is forced to address the budget and debt ceiling. In addition, these proposals still face the all important question – what proposals can both parties agree on that can offset the significant cost of repealing or delaying the scheduled cut.
EDPMA is holding its Leadership Lobby Day on November 6, 2013 on this important issue. EDPMA members will urge Congress to repeal the SGR formula which continues to mandate deep cuts and ensure that any offsets for the repeal or delay do not negatively impact access to quality ED care.
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