SGR Fix Still Murky for Physician Practices

United States CongressMany believe that Congress will again pass a short-term pay-fix before attempting a permanent repeal of the Medicare Sustainable Growth Rate (SGR). The temp fix passed last year expires on March 31, 2015. There are reports, however, that House and Senate leaderships are currently discussing a way to implement a permanent pay-fix before the March expiration date. Not addressing or postponing the SGR would result in a 21% reduction in Medicare payments for physicians as of April 1, 2015.

In late January, the House Energy and Commerce Health Subcommittee held a two-day hearing to discuss Medicare reform and how to build upon last year’s SGR replacement bill. That bill passed the House but died in the Senate. The sticking point,as always, was disagreement as to how to pay for it. Both Democrats and Republicans agree that the SGR formula must be fixed but they continue to disagree on how to responsibly pay for SGR reform in a way that can pass both Houses of Congress and be signed by the President. It is estimated that the costs to offset the SGR is approximately $140 billion.

The next two weeks will be telling as the House will be in session through March 26 and the Senate through March 27. Given the tight timeframe, it seems increasingly unlikely that the permanent SGR reduction will be in place as of April 1. A more likely scenario is that another temporary fix will be passed to give the House and Senate even more time to identify and agree on the offsets necessary to pay for a SGR fix. To keep focus on the issue, the next deadline may not be 2016, but September 2015. What is not likely is that Congress allows the severe reduction in physician reimbursement starting in 2 weeks.

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