News | February 20, 2012

Congress Again Delays Medicare Sustainable Growth Rate Cuts

February 20, 2012 — U.S. Senate and House legislators have reached a “doc fix” agreement this week to prevent slashing payments to physicians treating Medicare patients. A law was to take effect at the beginning of March would have reduced reimbursements by 27 percent.

The cuts were supposed to be a part of the sustainable growth rate (SGR) formula to reduce Medicare costs, but physician groups have argued every year that the cuts will reduce payments below the cost of providing medical services. Each year Congress has debated these cuts and made temporary “doc fixes” to prevent or delay the cuts. In December 2011, the House and Senate passed a two-month SGR fix for 2012 that averted the 27.4 percent Medicare payment cut being implemented on Jan. 1, 2012. The latest fix prevents cuts through the end of 2012.

“The ACC is relieved that the deal reportedly reached by Congress will temporarily stop the scheduled 27.4 percent Medicare physician payment cut from taking effect on March 1 and through the rest of 2012. But, we are very disappointed that Congress did not seize this opportunity to permanently repeal the flawed sustainable growth rate formula,” Sustainable Growth Rate (SGR) formula,” said Jack Lewin, M.D., CEO of the American College of Cardiology (ACC). “We will be right back in this mess again on Jan. 1, 2013, when the Bush tax cuts expire and the deficit-related ‘sequestration’ kick in – it will be a perfect storm. When will Congress stop using short-term, last-minute ‘doc fixes.’ The SGR deficit will be over $600 billion in 5 years! It’s time to awaken to reality and accountability.” 

Most physician groups support full repeal of the SGR with replacement by a mechanism that accurately reflects the costs of providing care.

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