Lawmakers pitch SGR replacement bill, put more emphasis on quality

The new proposal will repeal the current Sustainable Growth Rate and institute a .5 percent payment update each year for five years.

House and Senate leaders on Thursday introduced a new bill to replace the Sustainable Growth Rate formula and end the annual “doc fixes," Congressional leaders announced.

The new proposal will repeal the current SGR and institute a 0.5 percent payment update each year for five years.

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It will also improve the fee-for-service system by streamlining Medicare’s existing web of quality programs into one value-based performance program; increase payment accuracy and encourage physicians to adopt proven practices; incentivize the use of alternative payment models to encourage doctors and providers to focus more on coordination and prevention to improve quality and reduce costs; and make Medicare more transparent by giving patients more access to information and supplying doctors with data they can use to improve care.

The proposed legislation does not address funding for the SGR repeal, which is said to cost $210 billion. The broader bill, which is expected later, will likely address funding and an extension to the Children’s Health Insurance Program.

The bill is nearly identical to bipartisan legislation introduced in the House and Senate last year that failed to advance because of disputes over how to fund it.

The bipartisan policy agreement finally resolves the flawed SGR formula, providing certainty for seniors and their physicians, and creating a system that promotes the highest quality of care, according to Congressional leaders.

[Also: Everything you need to know about SGR]

Congress needed to act by April 1 or physicians who accepted Medicare would face a 21 percent pay cut as mandated by SGR.

Legislators have averted these physician fee cuts 17 times since 2003 by overriding the SGR with temporary “doc fixes.”

SGR was intended to constrain Medicare Part B physician spending by adjusting the annual fees for reimbursement of Medicare.

The legislation was introduced by Rep. Michael C. Burgess, R-TX, Senate Finance Committee Chairman Orrin Hatch, R-UT, House Energy and Commerce Committee Chairman Fred Upton, R-MI, House Energy and Commerce Committee Ranking Member Frank Pallone Jr.,  D-NJ, House Energy and Commerce Health Subcommittee Chairman Joe Pitts, R-PA, House Energy and Commerce Health Subcommittee Ranking Member Gene Green, D-TX, House Ways and Means Committee Chairman Paul Ryan, R-WI, House Ways and Means Committee Ranking Member Sander Levin, D-MI, House Ways and Means Health Subcommittee Chairman Kevin Brady, R-TX, House Ways and Means Health Subcommittee Ranking Member Jim McDermott, D-WA, and Rep. Charles Boustany, R-LA.

Here's the full bill:

Twitter: @SusanMorseHFN