government_400The SGR problem that has been an issue for over a decade, remains a high priority for senate leaders. The original SGR formula was developed during the Clinton administration and has had serious flaws. Since, a fix to the SGR problem as continued to be elusive.

A fix to the SGR is not imminent due to many factors but the House and Senate feel that a permanent fix appears achievable in 2013. Congressional Committees that have jurisdiction over Medicare Physician Payment reforms have held Hearings and gotten feedback on possible permanent solutions. Both Democratic and Republican leaders remain committed to finding a permanent solution whereas in past years, the commitment level was much much less.

Proposals have been circulated amongst various physician offices, as well as some other healthcare organizations for the purpose of feedback and reaction to proposed fixes. The Healthcare Billing and Management Association (HBMA) will meet with the Senate Finance Committee and other White House staffs to assist in finding permanent fix to the SGR problem.

If Congress fails to find a permanent solution prior to the end of 2013, the current estimate of a 24% reduction in provider payments will be necessary to comply with SGR law.

The following are concepts from discussions for the SGR fix:

  1. Repeal SGR and replace it with statutory increases (possibly 1 – 2% per year) for a period of time (3 – 5 years). Thus eliminating the 24% cut come January 1, 2014.
  2. Implement Specialty Specific Quality Measures as part of the payment formula.
  3. Payments would be a combination of “base rate” plus a variable rate that would be tied to quality/performance.
  4. A score on quality would be based upon a comparison of peers AND compared to the individual providers prior year scores AND provider participation in specialty specific clinical improvement initiatives.
  5. Providers of the same specialty would “self-identify” with a peer cohort and provide information on:
  • Identifies the peer group the provider wants to be compared to; and
  • Provides information on quality measures applicable peer group that the provider is assigned

The Health & Human Services (HHS) Secretary will be responsible for the development and methodology for assessing the performance of providers with respect to the measures and for methods of collecting data for the assessments. The Secretary is directed to develop the processes in a way that will minimize the administrative burden to ensure reliable results.

The HBMA and other healthcare organizations, continually encourge Congress to find a permanent solution to the SGR problem before January 2014.